S&P warned that interconnected AI financing structures may obscure liabilities, though it sees no immediate need for ratings changes.
- SpaceX is expected to report $13 billion in revenue and adjusted EPS of $0.13, according to Koyfin.
- RBC expects faster timelines and continued Starship momentum, while noting growing interest in a potential Tesla merger.
- Google reiterated that its existing SpaceX computing agreement provides short-term capacity to meet strong Gemini Enterprise demand.
Shares of Space Exploration Technologies Corp. (SPCX) slipped 0.4% overnight ahead of Tuesday’s third-quarter (Q3) results as S&P Global warned of unseen AI-related liabilities, while RBC Capital outlined over 50% upside and flagged growing investor interest in a potential Tesla merger.
SPCX stock rose over 1% to $147.96 on Monday, snapping four straight sessions of losses.
RBC Sees Upside Ahead Of SpaceX’s Q3 Report
SpaceX will release its Q3 results after the market closes on Tuesday. The firm is expected to report revenue of $13 billion, EBITDA of $6.62 billion and EBIT of $2.35 billion, according to Koyfin. Adjusted EPS is estimated at $0.13.
RBC Capital said that the timing surprised investors, many of whom had expected the report in November. Its preview put accelerating timelines, the recent spectrum purchase and sentiment around data centers at the center of the discussion.
“We anticipate positive commentary from SPCX management with a continued sense of urgency and further pull forward out-year goalposts,” the firm said. RBC maintained an ‘Outperform’ rating and a $225 price target, implying about 53% upside from current levels.
“We view the recent spectrum purchase as a positive, and Starship momentum on pace to continue,” RBC said. SpaceX agreed earlier this month to acquire Grain Management’s nationwide 800 MHz spectrum portfolio for its Starlink Mobile ambitions.
RBC also highlighted investor attention on a potential merger with Tesla. “Moreover, investor interest around a potential merger with TSLA is increasing,” the firm said.
S&P Flags Gaps In AI Debt Visibility
The earnings report comes amid scrutiny of how the AI buildout is being financed. S&P Global warned that interconnected financing arrangements can leave investors and ratings analysts without a complete picture of obligations. Such structures can involve hyperscalers effectively backing large data-center developments or smaller AI companies.
“It is safe to assume that there is more (debt) out there that we are not seeing,” S&P said during a London roundtable.
S&P expects Amazon, Microsoft, Alphabet, Oracle, Meta and SpaceX to spend more than $7 trillion on data centers and other AI-related capital expenditure between 2025 and 2030, with negative free cash flow persisting until at least next year.
S&P did not estimate how much additional debt the financing arrangements might create. It said the biggest ratings risk remained whether anticipated profits materialize, while unsustainable spending or intensifying competition could change the agency’s assessment. “For now, we don't have the view that there is a major disconnect that needs to force our ratings to change at this point,” S&P said.
Google’s SpaceX Deal Bridges Gemini Demand
Meanwhile, Google’s existing agreement to purchase computing capacity from SpaceX reflects demand for AI infrastructure amid growing scrutiny of the sector’s financing arrangements and capital requirements.
In a CNBC interview, Google’s global head of energy and power, Amanda Peterson Corio, reiterated that the arrangement helps bridge demand while Google develops its own infrastructure. “In the case of SpaceX, that's a very short term contract because our demand from Gemini enterprise customers was huge,” she said. “We will sometimes have to use short term solutions until we get the data center fully connected,” Corio added.
The arrangement was disclosed in June. Under the agreement, Google committed to paying $920 million monthly from October 2026 through June 2029 for capacity involving 110,000 Nvidia GPUs and associated equipment. Either party can terminate it on 90 days’ notice after Dec.31.
How Do Retail Traders Feel About SPCX?
On Stocktwits, retail sentiment for SPCX improved to ‘neutral’ from ‘bearish’ a day ago, amid a 184% jump in 24-hour message volume.
One user said, “$SPCX I’m going to watch Star Wars tonight and drift off to sleep. dreaming of a huge earning report and great forward guidance pumping the stock over the highs of 200+”
View this Stocktwits post
Another user said, “$SPCX Excited to see SpaceX report its first profitable quarter. I added to my position today at a higher price than my initial entry, reflecting my continued confidence in the company’s growth potential. Now watching closely for that 7% swing prediction”
View this Stocktwits post
SPCX stock has declined 8% year-to-date.
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