SpaceX Revenue Surges 161 Percent, Prompting Major Wall Street Price Target Revisions

SpaceX reported third quarter revenue of $14.6 billion, marking a 161 percent year over year jump that significantly exceeded market expectations. This figure comfortably surpassed consensus estimates, which hovered near $12.7 billion, signaling a period of explosive growth for the company. The financial performance also saw the firm swing to a net profit of $4.4 billion, reversing a loss seen in the same period last year. Additionally, adjusted EBITDA reached $8.8 billion, underscoring the operational strength behind the top line growth.

The company's Super Intelligence division emerged as the largest revenue contributor, generating approximately $7.6 billion. This segment grew nearly 830 percent year over year, driven by accelerating expansion in AI compute capabilities. Meanwhile, the Connectivity segment delivered $5.2 billion in revenue, supported by strong subscriber additions that brought the total Starlink consumer base to 13.6 million. These dual engines of growth appear to be reshaping the company's long term earnings power.

During the earnings call, CEO Elon Musk and CFO Bret Johnsen provided guidance that far outstripped analyst models. They projected first quarter 2027 revenue between $33 billion and $37 billion, a substantial increase from the roughly $22 billion analysts had previously estimated. The executives also outlined fourth quarter capital expenditure plans ranging from $35 billion to $40 billion, with a primary focus on AI compute infrastructure at sites in Memphis and Southaven. Management indicated targets of 2.5 to 3 gigawatts of nameplate compute capacity by year end, with pathways discussed to reach 13 gigawatts or more by the end of 2027.

The call highlighted several operational milestones, including Starship’s recent orbital success and the deployment of V3 satellites. Other key points included rapid adoption of the Grok Bot, spectrum expansion plans, and the formation of special committees to explore a possible combination with Tesla. Musk noted relentless demand from hyperscalers, stating that current compute pricing supports payback periods of less than a year, and in some cases, as short as six months.

Wall Street reacted swiftly to these updates. JPMorgan more than doubled its price target to $500 from $240 while maintaining an Overweight rating. Cantor Fitzgerald raised its target to $345, and both Barclays and Morgan Stanley set targets at $300. Citi increased its estimate to $240, while UBS and TD Cowen moved to $230 and $224 respectively. Other firms, including Wells Fargo and Clear Street, also adjusted their targets higher, reflecting broad conviction in the company's trajectory across launch, connectivity, and AI segments.

Following the market close on October 20, shares jumped roughly 8 percent in early premarket trading on October 21 after having closed at $147.79. The average analyst price target has moved higher, indicating increased confidence in SpaceX's future despite the significant spending on infrastructure. Investors are closely watching how the elevated capital expenditure plans will translate into sustained revenue growth in the coming quarters.

The combination of strong quarterly results and aggressive forward guidance has shifted the narrative around the stock. While elevated spending remains a point of focus for some, the breadth of price target increases suggests that the market is prioritizing the company's dominant position in both satellite connectivity and AI computing infrastructure. The coming months will test whether this growth momentum can be sustained as new infrastructure comes online.