SpaceX earnings shock Wall Street with massive price hikes

The tension between heavy capital expenditure and explosive growth reached a breaking point on Tuesday as Wall Street analysts reacted to SpaceX's latest financial report. The company's third quarter performance for 2026 significantly exceeded expectations, triggering a rapid and substantial increase in price targets across the market. This move sent shares sharply higher in after-hours trading following the market close on October 20.

The numbers behind the surge were striking. SpaceX reported revenue of $14.6 billion, representing a 161 percent year-over-year increase that comfortably surpassed consensus estimates of roughly $12.7 billion. The company also swung to a net profit of $4.4 billion, reversing a loss from the prior year, while adjusted EBITDA reached $8.8 billion. The Super Intelligence division emerged as the largest revenue contributor, generating approximately $7.6 billion and growing nearly 830 percent year-over-year. Meanwhile, the Connectivity segment delivered $5.2 billion, lifting the Starlink consumer base to 13.6 million users.

CEO Elon Musk and CFO Bret Johnsen provided the catalyst during the earnings call by outlining revenue guidance for the first quarter of 2027 between $33 billion and $37 billion. This projection was far above the approximately $22 billion modeled by analysts. The management team also detailed fourth quarter capital expenditure plans ranging from $35 billion to $40 billion, with a focus on AI compute infrastructure in Memphis and Southaven. They targeted 2.5 to 3 gigawatts of nameplate compute capacity by year-end, with pathways to 13 gigawatts or more by the end of 2027. Musk noted that relentless demand from hyperscalers supports payback periods of less than a year, potentially as short as six months.

The market response was immediate and robust. JPMorgan more than doubled its target to $500 from $240, while maintaining an Overweight rating. Cantor Fitzgerald lifted its target to $345 from $246, and Barclays raised its target to $300 from $254. Citi increased its target to $240 from $200, UBS moved to $230 from $210, and TD Cowen raised its target to $224 from $200. Morgan Stanley held an Overweight rating with a $300 target. Other firms also adjusted higher, including Wells Fargo, which moved its target to $274 from $214, and Clear Street, which raised its target to $248 from $217.

Analysts broadly cited the strong quarterly print, accelerating AI compute expansion, Starlink progress, and recent Starship milestones as key drivers of higher long-term growth and earnings power. Additional highlights included Starship’s orbital success, V3 satellite deployment, and the rapid adoption of Grok Bot. The company also formed special committees to explore a possible combination with Tesla.

Shares, which closed at $147.79 on October 20, jumped roughly 8 percent in early premarket trading on October 21 as investors digested the results. The average analyst price target has moved higher, reflecting greater conviction in SpaceX’s trajectory across launch, connectivity, and the Super Intelligence business. Even as elevated spending remains a point of focus, the data suggests a strong belief in the company's future capacity.