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Space Exploration Technologies (SPCX) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Industrials· Aug 4, 2026

Source: earnings call transcript

Executive summary

SpaceX Q2 FY26 — Record Starlink Subscriber Growth and Accelerating AI Compute Expansion

SpaceX delivered an exceptional quarter, showcasing robust growth across all its segments driven by strong operational execution and strategic investments. The company continues to advance its ambitious Starship program towards full reusability, while Starlink expands its global reach and prepares for a significant upgrade with V3 satellites. Rapid scaling of AI compute capacity and the development of Grok models further underscore the company's multi-faceted growth trajectory and long-term vision.

Highlights

6

  • Total revenue increased 92% year-over-year to $7.8 billion.

  • Adjusted EBITDA grew 191% year-over-year to $3.5 billion.

  • Net loss improved by $467 million compared to the prior-year quarter.

  • Starlink added over 1.7 million net subscribers globally, marking its best quarter for new customers.

  • AI segment revenue surged 247% year-over-year to $2.6 billion and turned adjusted EBITDA positive at $1.1 billion.

  • Ended the quarter with a strong balance sheet, including $100 billion in cash, cash equivalents, and marketable securities.

Concerns

3

  • Blended ARPU decline due to geographic expansion

  • Regulatory hurdles for Cursor acquisition

  • Supply-demand imbalance in compute market (memory)

Guidance & targets

CategoryTargetConfidence
AI Compute Capacity
over 2 gigawatts
high materiality
High
Cumulative AI Compute Online
closer to 10 gigawatts of compute than 5 gigawatts of compute
high materiality
Medium
Annualized Revenue Run Rate (ARR)
$100 billion of ARR
high materiality
High
Total Revenue
$1 trillion
high materiality
High
Starship Flight Cadence
at least 1 flight a day, possibly more
high materiality
Medium
Starlink Mobile Service Launch
start providing service
high materiality
High
Starship Human-Rated Reliability
achieve a level of safety needed for humans
high materiality
Medium
Artemis III Mission
dock with the Orion spacecraft
high materiality
High
Boots on the Moon
put boots on the moon
high materiality
Medium
Starlink V3 Satellite Critical Mass
approximately second quarter next year
medium materiality
Medium

Segment performance

SegmentRevenueYoYQoQMargin
Space
Revenue growth driven by a higher number of larger customer launches and a favorable customer mix. Adjusted EBITDA loss primarily reflects higher R&D expenses for the Starship program.
$962 million29%55%($205 million) adjusted EBITDA loss
Connectivity
Growth driven by record net additions of Starlink subscribers and a sharp increase in enterprise and government revenue. Income from operations increased 79% year-over-year, driving nearly 3 points of operating margin expansion. Adjusted EBITDA rose 64% year-over-year to $2.6 billion.
Starlink subscriber ARPU: $66 per month
$4.3 billion66%32%$1.7 billion income from operations
AI
Increase driven primarily by new cloud services agreements ($1.6 billion incremental AI infrastructure revenue) and growth in Grok and X subscription revenue. Advertising revenue grew 7% sequentially. Segment turned adjusted EBITDA positive.
$2.6 billion247%213%$1.1 billion adjusted EBITDA

Product announcements

ProductTypeDetails
Grok 4.5launch
Grok 4.6launch
Grok 4.7launch
Grok 5roadmap
Starmind AI satellitelaunch
Starlink mobile partnershipsexpansion
EchoStar spectrum transfermilestone

Deals & partnerships

American Airlines Major agreement for Starlink service.

Signed a major agreement for Starlink service.

Southwest, Virgin Atlantic, Iberia, Aer Lingus New partnerships for Starlink service.

Activated Starlink service with new airline partners.

SoftBank, NTT Docomo, Spark New Zealand Starlink mobile partnerships with international carriers.

Launched new Starlink mobile partnerships.

Google and Anthropic Cloud services agreements for compute capacity.

Entered into cloud services agreements providing access to compute capacity at Colossus and Colossus II sites.

NVIDIA Close cooperation and partnership on AI computing architecture.

Decided to build exclusively on NVIDIA's Vera Rubin architecture, greatly valuing the cooperation.

EchoStar Spectrum credit agreement related to pending transaction.

Pending transaction involving spectrum transfer, recently approved by the FCC.

Cursor Acquisition of Cursor team to integrate engineering and sales capabilities.

Acquisition expected to close soon, with almost all regulatory hurdles cleared.

Risks & headwinds

Blended ARPU decline due to geographic expansion over time

directional

Mitigation:Anticipate continued subscriber momentum to deliver strong revenue growth.

Regulatory hurdles for Cursor acquisition near-term

directional

Mitigation:Almost all regulatory hurdles are through, expecting to close quite soon.

Supply-demand imbalance in compute market (memory) ongoing

Memory output increasing by ~20% per year, demand increasing by ~200% per year.

Mitigation:SpaceX's efficiency of compute deployment is highest, and intelligence per watt is increasing rapidly.

What to watch in Q3 FY26

Starship Flight Cadence

next flight (end of month), within a year
Current 2 successful V3 flights in 90 days
Target Increased flight frequency, attempt to catch ship with tower

Why it matters

Increased flight cadence and successful reusability are critical for Starship's operationalization and long-term vision of mass to orbit.

we'll attempt to catch the ship with the tower on the next flight which is tentatively scheduled for the end of this month. We expect the cadence of flights to be increasing rapidly. And probably a year from now, we will be doing at least 1 flight a day, possibly more.

Find out whether SPCX delivers this. Inve re-checks your case every morning.

Q&A highlights

Can you discuss the backlog of enterprise and government contracts in the Connectivity segment, how it converts to revenue, and its impact on future growth?

Management is bullish on enterprise activities, citing over $6 billion in Q2 government contracts as tranches for future capability. Enterprise revenue is sticky, with no lost customers. Significant headroom exists in aviation (less than 10% penetrated) and maritime, where Starlink expands the TAM. Elon added that demonstrating high reliability is key for enterprise customers to view Starlink as a primary provider, expecting enterprise revenue to substantially exceed consumer revenue.

“I would expect enterprise revenue to substantially exceed consumer revenue.”

asked by Eric Sheridan · answered by Elon Musk

2 min read 5 chapters

Detailed narrative

Starship Development and Reusability Milestones

SpaceX completed two successful flights of Starship V3 in the past 90 days, with Flight 13 demonstrating core orbital capabilities and Flight 14 planned for the first deployment of V3 Starlink satellites. The company aims to achieve full reusability by catching both stages this year and potentially the ship as soon as the next flight. Management emphasized the profound impact of Starship, aspiring to deliver over 1 million tons to orbit per year, a significant leap from the current 2,500 tons/year via Falcon.

Starlink Expansion and V3 Satellite Capabilities

Starlink achieved record net additions of over 1.7 million subscribers in Q2, reaching 167 markets globally. The upcoming V3 Starlink satellites are expected to be an order of magnitude more capable than V2, with plans to launch 10 times as many, leading to a roughly two-order-of-magnitude increase in delivered bandwidth. This expansion is projected to enable Starlink to service a majority of global internet traffic within 10 years, especially with the growing demand from AI and robotics.

AI Compute Infrastructure and Grok Progress

SpaceX is rapidly expanding its AI compute capacity, ending Q2 with 1.4 gigawatts (GW) of nameplate compute, up from 1 GW in Q1, and targeting over 2 GW by year-end. The company plans to build exclusively on NVIDIA's Vera Rubin architecture, valuing the partnership. Grok 4.5 saw positive enterprise feedback and tripled token consumption, with Grok 4.6 and 4.7 releases imminent, and Grok 5 (incorporating all SpaceX data) expected by year-end. The Starmind AI satellite, an optimized NVL72 computer, is slated for launch next year.

Capital Allocation and Financial Strength

The company demonstrated strong Q2 financial results with accelerated revenue growth across all segments and a significant improvement in net loss. SpaceX completed its IPO, raising $85.7 billion, and an inaugural $25 billion investment-grade senior notes offering, strengthening its balance sheet to $100 billion in cash and marketable securities. Capital allocation priorities remain focused on Starship, next-gen Starlink, and AI compute infrastructure, with new compute deployments achieving a payback period of less than one year.

Enterprise and Government Growth Opportunities

Starlink sees significant growth potential in enterprise and government sectors, with revenue from these markets expected to comparable or exceed consumer business. The company signed a major agreement with American Airlines and secured over $6 billion in U.S. government contracts in Q2. Management highlighted low penetration in aviation (less than 10%) and the dramatic expansion of the maritime total addressable market (TAM) as key drivers. Starlink Mobile, leveraging EchoStar spectrum and next-gen satellites, is expected to launch service by end of next year, offering a 100x improvement in capability.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.