SpaceX's (SPCX) second-quarter loss narrowed as revenue surged past Wall Street's expectations, driven by strong growth in the connectivity and artificial intelligence segments.
Its June-quarter loss narrowed to $0.09 per share from $0.34 a year earlier, the rocket and satellite company's first earnings report since going public in June showed.
Revenue climbed 92% year-over-year to $7.81 billion, topping the FactSet-polled consensus of $6.83 billion.
The connectivity division's revenue soared 66% to $4.29 billion, driven by Starlink subscriber growth, SpaceX said. AI sales more than tripled to $2.56 billion amid new cloud service agreements, as well as gains in subscription revenue at AI assistant Grok and social media platform X.
The company's capital expenditures rallied to $18.37 billion in the second quarter from $2.83 billion a year ago.
Shares of SpaceX were down 7.4% in after-hours trading, having climbed 9.4% to $125.33 at market close on Tuesday.
The stock traded as high as $225.64 intraday in June following a record initial public offering that rose a total of $85.7 billion. SpaceX had priced its IPO at $135 per share.
"While we remain steadfast in our long-term bull thesis for SpaceX, the stock has clearly been under significant downward pressure," Deutsche Bank said in a note emailed Monday. "We think the main issue has been a tactical fear of the upcoming lock-ups, further exacerbated by uncertainty around the AI business, complexity of a potential Tesla (TSLA) merger, and lower than expected passive index buying."
Up to 20% of shareholders' locked-up stock could be sold starting Aug. 6, the second full trading day following the release of quarterly results. An additional 10% may be available for sale if the stock closes at least 30% above the $135 level for a minimum of five of 10 consecutive trading days.
"We are optimistic following the lock-ups coming off, the stock can stabilize at some level," Deutsche Bank analyst Edison Yu wrote.
Some on Wall Street have flagged the possibility of a merger between Tesla and SpaceX, both headed by Elon Musk.
In February, SpaceX acquired artificial intelligence startup xAI, now known as SpaceXAI, which houses Grok and the X platform.
Later in the year, SpaceX agreed to provide Anthropic access to compute infrastructure and struck a cloud services agreement with Alphabet's (GOOG, GOOGL) Google, which agreed to pay $920 million per month from October 2026 to June 2029.
SpaceX in June signed a deal to provide Reflection AI with Nvidia's (NVDA) AI chips for $150 million a month, CNBC reported at the time.
The stock's share price presents an attractive buying opportunity, RBC Capital Markets said in a note emailed Monday, citing strength in the connectivity and space businesses.
The space segment's revenue rose 29% year-over-year to $962 million in the second quarter, driven by "large customer launches and a favorable customer shift," SpaceX said.
"We can appreciate that from a fundamental basis, not too much has changed since the IPO relative to the revenue and earnings growth we expect through (about 2030)," RBC said.
