Tesla and SpaceX weigh merger after $14.58 bn quarter

Tesla and SpaceX are discussing a merger after SpaceX posted $14.58 billion in third-quarter revenue, CNBC’s Daily Open newsletter said on Oct. 21, citing Elon Musk’s earnings-call comments.

The proposal would combine Tesla’s electric-vehicle and artificial-intelligence businesses with SpaceX’s rockets and satellite operations; SpaceX’s quarterly revenue was about 15% above the $12.72 billion expected, according to Atlas360 calculations.

Musk said on SpaceX’s third-quarter earnings call that combining the companies would be a “good idea.” He said the boards of both companies had formed special committees to discuss a possible transaction.

Musk said he would not take part in the talks because he is a “conflicted party.” He cited possible cooperation across software, chips and other areas as reasons a combination could have merit.

SpaceX reported third-quarter operating income of $2.8 billion and net income of $4.4 billion. Net income exceeded operating income by $1.6 billion, according to Atlas360 calculations.

Adjusted earnings per share were 45 cents in the third quarter, compared with analyst forecasts of 13 cents. Chief Financial Officer Bret Johnsen said on the call that SpaceX expects first-quarter 2027 revenue of $33 billion to $37 billion.

The midpoint of that forecast, $35 billion, is about 58% above the $22.2 billion average analyst estimate compiled by LSEG, according to Atlas360 calculations. The forecast gives the merger discussions added significance for investors because SpaceX would bring a fast-expanding revenue base into any combined structure.

A merger would bring two Musk-led companies with different capital needs, customers and regulatory exposures under one corporate structure. SpaceX operates in aerospace, satellites and government-linked communications services, while Tesla’s business is tied to vehicles, software and energy products.

The report did not provide proposed merger terms or a timetable for a decision. Any transaction would face scrutiny over governance because Musk has roles across both companies, a concern reflected in his decision to stay outside committee discussions.

The talks also come as Musk faces questions over Starlink’s role in Ukraine. CNBC cited a Wall Street Journal report that Musk ordered a slowdown of a military-grade Starlink service used by Ukraine, affecting connected military hardware.

Musk previously said restrictions on the system were ultimately decided by the U.S. military and the president. President Donald Trump told reporters Monday that he did not know who was responsible.

Source: CNBC Daily Open newsletter, CNBC, Oct. 21, 2026