SpaceX posts $541m loss despite revenue surge in record IPO quarter

Elon Musk's space company SpaceX closed its first quarter since its record initial public offering (IPO) with another loss, posting a net deficit of $541 million on Tuesday, down from a loss of around $1 billion a year earlier.

Revenue, meanwhile, rose by almost 92% year-on-year to $7.8 billion, well above analyst expectations of around $6.9 billion on average.

Musk said in a conference call with analysts that SpaceX now expected to generate $1 trillion in annual revenue by 2030, one year earlier than previously forecast.

The company is currently still a long way from that figure. Musk said the expected rapid growth would come mainly from the artificial intelligence (AI) business. SpaceX's AI division generated $2.56 billion in revenue in the past quarter and invested $15.8 billion, mainly in expanding data centres.

Amazon, the retail and cloud computing giant, currently comes closest to the $1-trillion annual revenue mark, having generated almost $717 billion last year.

SpaceX's main revenue driver is still its Starlink satellite internet service. In the past quarter, Starlink's revenue grew by almost two thirds year-on-year to around $4.3 billion, with a growing number of airlines among its customers. Operating profit rose 80% to around $1.66 billion.

The number of Starlink customers grew from 10.3 million to 12 million in three months. SpaceX plans to use new satellites to connect smartphones directly to the Starlink network, potentially putting it in competition with telecommunications companies.

Chief operating officer Gwynne Shotwell said she was confident that Starlink could win customers from major mobile network operators with new, more powerful satellites. She said the service would be better and could provide coverage in areas that currently lack mobile internet access.

SpaceX went public in mid-June with a record IPO raising $75 billion. At an issue price of $135, Musk's company debuted with a valuation of nearly $1.8 trillion - a stark contrast to its current financial performance, though SpaceX justified the valuation with ambitious plans in the field of artificial intelligence.

In the weeks following the IPO, the share price climbed - driven in part by retail investor interest - to just over $225. The stock has since fallen below its issue price, closing Tuesday's regular US trading session at around $125. The shares fell by more than 7% in after-hours trading.

On Thursday, the lock-up period expires for additional shares held by company insiders and early investors, which could then enter the market.

SpaceX has become indispensable to the US space programme in recent years. Musk said its Falcon 9 rocket currently carries around 2,500 tons of payload into space each year.

The company is currently investing heavily in its large Starship rocket, which is still conducting test flights and is intended to significantly reduce the cost of carrying payloads into space.

Musk said SpaceX was targeting annual payload capacity of 1 million tons with Starship, and potentially 10 million tons. He said Starship would "probably" be launched at least once a day within a year, and possibly more often.

Deadlines set by Musk have often slipped at electric carmaker Tesla, which he also leads, including those for autonomous driving and new models.

Overall, spending on Starship and the expansion of the AI business exceeded the profits generated by Starlink.

Speculation that Musk could have SpaceX take over Tesla was not discussed during the analyst call.