The Space Exploration Technologies Corp (NASDAQ: SPCX) (SpaceX) share price has dropped 7.5% in after-hours trading following its 2026 second quarter update.
SpaceX is the world leader of reusable space rockets, taking significant volume of cargo up into space. It also has Starlink – satellites that provide connectivity to regions of Earth’s surface – and xAI, which is a business of data centres, AI and X (Twitter).
2026 second quarter performance
SpaceX reported that for the June 2026 quarter, its revenue grew by 92% to $7.8 billion.
The business saw growth across its three segments. Space revenue rose 29% to $962 million. Connectivity revenue increased 66% to $4.3 billion and AI revenue rose 247.5% to $2.56 billion.
Overall adjusted EBITDA (EBITDA explained) grew 191% to $3.5 billion and the net loss improved $467 million to a loss of $541 million from $1 billion last year.
The company reported how much profit each segment delivered.
The adjusted EBITDA loss for the space division more than doubled to $205 million, for AI the adjusted EBITDA grew $1.4 billion to positive $1.15 billion, and connectivity adjusted EBITDA increased 64% to $2.6 billion.
Business highlights
The company noted that in the year to date, its space division delivered 78 total launches and delivered 1,041 tonnes of mass to orbit. For the quarter, there were 10 customer launches and 28 internal launches.
Connectivity saw Starlink subscribers reach 12 million (up 100% year on year), with 10,200 satellites in orbit providing coverage to 167 countries.
The AI division reported nameplate compute draw of 1.4GW (up 1GW year on year), with Grok 4.5 launched on 16 July 2026.
Outlook for the SpaceX share price
CNBC reported that SpaceX CFO Bret Johnson said on an earnings call it’s on track to reach $100 billion of annualised recurring revenue (ARR) by the end of the year. In the first few weeks of the current quarter, it has contracted an additional $6.7 billion of cloud services revenue.
One of the negatives for the company may be its large increase in capital expenditure. Total capital expenditure for the quarter was $18.4 billion, up 550% year on year. AI took up nearly all of that increase, seeing a 2,013% rise year on year to $15.8 billion.
The company will need to deliver ongoing revenue growth for its division to justify the current market valuation. Will its capex be justified? Time will tell.
If SpaceX continues its space leadership, its earnings could grow significantly. But, most of its spending seems to be focused on AI right now, even though that’s not where I think the long-term real value of the business will be created.
Over the ultra-long-term, it may prove itself, but I’m not convinced this is a great valuation to buy at.
