SpaceX revenue jumps 92% in first public earnings report

Elon Musk's SpaceX has posted its first earnings report as a public company, revealing revenue nearly doubled over the past year even as spending on artificial intelligence infrastructure ballooned.

Stocks declined in after-hours trading despite the tech giant beating analyst forecasts in terms of revenue and earnings.

Revenue stood at $7.8 billion (£5.8 billion) for the second quarter period, which was a 92% increase from the prior year period.

The company recorded net losses for the quarter at $541 million, compared to the $1 billion that the tech giant incurred in the same period a year ago. SpaceX started trading in the US stock market in June.

Is SpaceX spending too much on AI?

Starlink, SpaceX's satellite internet arm, was the only division turning a profit, generating $1.6bn in the quarter. Musk told analysts on an earnings call that people were "underestimating" the company, pointing to Starlink's growth.

"It's not out of the question that, at some point, Starlink will operate most of the world's internet," he said.

The AI compute division of SpaceX reported a loss of $1.2bn on $2.5bn in sales for the period, but the space division itself saw a net loss of $542m on sales of $962m.

As Musk explained, the firm presently operates 1.4 gigawatts of AI computing power and is set to achieve at least 10 gigawatts by next year. According to SpaceX Chief Financial Officer Bret Johnson, capital expenditures will remain very similar throughout the rest of the year.

Investor Carré Partners Chief Executive Wendy Souvannarath told BBC News that heavy AI spending was now standard across the tech sector. 

Brady Wang of Counterpoint Research said Starlink's subscriber numbers were strong, but analyst Fabien Yip of IG cautioned it was "a stretch" to call the whole company underestimated while its AI arm continued to lose money.