SpaceX Shares Surge as Wall Street Revises Valuations After Record Earnings

The valuation of SpaceX has been fundamentally rewritten in a matter of hours following a financial report that shattered market expectations.

The shift in sentiment began when the company released its third-quarter results for 2026 on the evening of October 20. The data revealed a revenue figure of $14.6 billion, a 161 percent increase year-over-year that significantly exceeded the consensus estimate of approximately $12.7 billion. This surge in income allowed the firm to swing from a loss in the prior year to a net profit of $4.4 billion, while adjusted EBITDA climbed to $8.8 billion.

The driving force behind this performance was the Super Intelligence division, which generated roughly $7.6 billion in revenue, marking an 830 percent jump from the previous year. This segment has now become the company's largest revenue contributor. Simultaneously, the connectivity segment delivered $5.2 billion, driven by subscriber growth that expanded the Starlink consumer base to 13.6 million users.

However, the catalyst for the broader market reaction was the forward-looking guidance provided during the earnings call. CEO Elon Musk and CFO Bret Johnsen outlined revenue projections for the first quarter of 2027 ranging from $33 billion to $37 billion, a figure far exceeding the $22 billion modeled by analysts. To support this trajectory, management detailed fourth-quarter capital expenditures between $35 billion and $40 billion, primarily directed toward AI compute infrastructure in Memphis and Southaven.

Management expressed confidence in the scalability of this infrastructure, targeting 2.5 to 3 gigawatts of nameplate compute capacity by the end of the year and discussing pathways to reach 13 gigawatts or more by the end of 2027. Musk noted that demand from hyperscalers remains intense, with compute pricing supporting payback periods of less than a year, and potentially as short as six months. The call also highlighted recent orbital successes for Starship, V3 satellite deployments, and the formation of committees to explore a potential combination with Tesla.

In response, Wall Street analysts issued a wave of price target increases. JPMorgan more than doubled its target to $500 from $240, while Cantor Fitzgerald raised its estimate to $345. Other major firms, including Barclays, Citi, UBS, and TD Cowen, also elevated their targets, citing the strong quarterly performance and accelerating AI expansion as key drivers. Morgan Stanley maintained an Overweight rating with a $300 target, and firms like Wells Fargo and Clear Street also adjusted their outlooks upward.

Following the close on October 20 at $147.79, SpaceX shares jumped roughly 8 percent in premarket trading on October 21. This movement reflects a growing conviction in the company's trajectory across launch, connectivity, and AI, even as investors weigh the impact of the company's elevated spending plans.