Musk said $1 trillion in SpaceX revenue in 2028 was “no longer impossible,” versus the 2030 scenario he outlined in June.
Gene Munster sees 95% odds of a Tesla merger within two years, while Dan Ives puts the probability at 80%-90% by end-2027.
Independent committees are exploring a merger, but Musk cautioned that shareholder approval is a hurdle.
Shares of Space Exploration Technologies Corp. (SPCX) jumped over 8% overnight late Tuesday as CEO Elon Musk said $1 trillion in revenue in 2028 was “no longer impossible,” while Deepwater Asset Management’s Gene Munster put the odds of a Tesla (TSLA) merger within two years at 95%.
SPCX stock edged 0.1% lower to close Tuesday at $147.79. Shares are down 2% so far in October, on track to snap a two-month winning streak.
“As crazy as this sounds, $1T in SpaceX revenue in 2028 is no longer impossible,” Musk said on X. His outlook brings the possibility forward by two years from the scenario he outlined in June, when he said the milestone might not be reached until 2030.
His latest post followed an ambitious claim on the earnings call about SpaceX’s annual revenue run rate (ARR) by the end of next year: “I mean, in a nutshell, what this implies for SpaceX annual recurring revenue by the end of 2027 is somewhere between $500 billion and $1 trillion”
Meanwhile, CFO Bret Johnsen maintained the goal of exiting 2026 at a $100 billion ARR. Munster said investors’ willingness to look past that unchanged goal suggested they were focused on 2027 and beyond.
ARK Investment Management’s Chief Futurist Brett Winton said the longer-term run-rate ambition wasn’t far ahead of ARK’s expectations. “$500b+ in ARR by end of 27 sounds a lot, but it’s not that far ahead of our expectations,” Winton said. “Our model suggests $300b, crossing $500b in the first half of 28.”
Tesla Merger Optimism Builds, But Musk Flags Hurdles
Munster, on the other hand, interpreted the call as another step toward combining Musk’s businesses. “The stars are lining up for Elon to fully realize his vision of $SPCX being a vertical AI company, with the odds of a $TSLA merger increasing,” he said on X.
In a separate post, he said: “My take: 95% chance in the next two years.” Musk confirmed that SpaceX and Tesla had formed special committees of independent directors at shareholders’ request. Since he runs both companies and is a conflicted party, he said he cannot participate in the talks. He pointed to potential benefits from cooperating on superintelligence software, chip design, Terafab, robotics, mass-to-orbit capabilities and connectivity.
“I think some people out there assume that a SpaceX and Tesla merger is a certainty, and I think that would be overstating it,” Musk said. He also said Tesla approval would require support from 50% of all shares, rather than only shares voted, calling it “quite a high hurdle.”
Winton also said that Tesla shareholders with investment horizons beyond 2030 should favor a merger even without a premium. “Tesla shareholders should be in favor of the merger at no premium, if their time horizon is anything beyond 2030. A 50% premium would bring 2030 in bounds as well,” Winton said on X.
Yorkville Ives partner and senior managing director Dan Ives also put the odds of a Tesla-SpaceX merger by the end of 2027 at 80%-90%, citing strategic AI and data benefits and calling it “the right move for Musk.”
SPCX Q3 Review
SpaceX beat Q3 estimates with earnings of $0.35 per share versus $0.16 expected and revenue of $14.575 billion against a $13 billion forecast. It projected first quarter (Q1) revenue of $33 billion-$37 billion and fourth quarter (Q4) capex of $35 billion-$40 billion, with Q4 gross margins more consistent with Q2.
Ives expressed optimism on X: “They beat across all metrics and the Starlink business looks to be accelerating while the core Space sector is ready for a big 2027.”
TSLA Capex Expectations Put Cash In Focus
SpaceX’s funding needs also drew attention, with both Munster and GLJ Research analyst Gordon Johnson expecting a capital raise. Munster sees a capital raise within six months, pointing to operating cash flow, debt access and potential vendor financing.
Additionally, Johnson noted that cash and cash equivalents had fallen 50% from about $100 billion a quarter ago to $50 billion, missing consensus by about $40 billion. He sees SpaceX raising money again in the fourth quarter and questioned how the position squared with a Tesla acquisition.
On the call, finance chief Johnsen confirmed discussions with debt-capital providers and said SpaceX intended to preserve its investment-grade status while financing its expansion. “You have your operational cash flows, first and foremost,” he said. “You have multiple pools of capital available in the debt market, especially because of our investment grade status and strong balance sheet.”
How Do Retail Traders Feel About SPCX?
On Stocktwits, retail sentiment for SPCX flipped dramatically to ‘extremely bullish’ from ‘bearish’ levels a day ago amid a 300% surge in 24-hour message volumes.
SPCX sentiment and message volume as of October 20 | Source: Stocktwits
One user said, “$TSLA I’ll be happy with $500 a share if the $SPCX merger happens.”
Another user said, “$SPCX Gamma squeeze tomorrow. Premiums were very low and now they will explode higher. Everyone is going to try to get it all at once..”
SPCX stock has declined 8% year-to-date.
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Deepti Sri has no position in any of the stocks mentioned in this article. StockTwits’ news team content is for informational purposes only and is not intended as investment advice. For more, see our editorial policy. This article was originally published on StockTwits.
