On October 20, 2026, SpaceX announced that its revenue for the July-September quarter rose 161% year over year to $14.575 billion. The Super Intelligence (SI) segment, renamed from the former AI segment, also turned an operating profit, a major step forward from the previous quarter, when only the Connectivity segment generated profit. However, while the SI segment accounts for more than half of total revenue, most of the company's operating profit comes from the Connectivity segment, which runs the Starlink satellite communications service. Comparing revenue, operating profit and capital expenditures by segment reveals the earnings structure behind SpaceX's rapid growth, along with the challenges that come with massive AI investment.
Different Segments Lead in Revenue, Operating Profit and Capital Spending
The SI segment's operating result improved from a loss of $1.257 billion in the April-June quarter of 2026 to a profit of $431 million in July-September. Company-wide operating results swung from a loss of $143 million in the previous quarter to a profit of $2.791 billion, and net income reached $4.404 billion. A year earlier, SpaceX recorded a net loss of $1.054 billion, so profitability has improved substantially.
Still, the segments differ greatly in revenue scale, profitability and investment. Based on the segment results on page 3 of SpaceX's third-quarter 2026 earnings release, the figures are as follows:
| Segment | Revenue | Operating result | Capital expenditures |
|---|---|---|---|
| Space | $1.767 billion | $7 million loss | $1.606 billion |
| Connectivity | $5.248 billion | $2.367 billion profit | $1.543 billion |
| SI | $7.560 billion | $431 million profit | $16.444 billion |
| Company total | $14.575 billion | $2.791 billion profit | $19.593 billion |
The SI segment accounts for 51.9% of total revenue and 83.9% of capital expenditures. Meanwhile, the Connectivity segment's operating profit makes up 84.8% of the company's total operating profit. These percentages were calculated from the figures in millions of dollars in the earnings release, dividing SI revenue of 7,560 by total revenue of 14,575, SI capital expenditures of 16,444 by total capital expenditures of 19,593, and Connectivity operating profit of 2,367 by total operating profit of 2,791, each rounded to one decimal place. The total operating profit calculation includes the Space segment's loss.
These numbers show that the SI segment is a growth business that is rapidly increasing revenue while expanding its facilities, while the Connectivity segment is a highly profitable business that supports the company's overall earnings. However, the segments' shares of profit and capital spending do not show how much of the cash generated by the communications business was actually directed to the SI segment. Evaluating growth and profitability separately is important for understanding this earnings report. Also, SI is a rename of the former AI segment, and the new name does not mean that "superintelligence" has been achieved in a technical sense.
Cursor Acquisition Contributes to Growth as Compute Capacity Expands to 1.7 GW
SI segment revenue soared from $813 million in the same quarter a year earlier to $7.560 billion, a year-over-year increase of 830%. SpaceX cited revenue from new cloud service contracts, the acquisition of Cursor, and wider adoption of Grok by businesses and consumers as the main growth drivers. In other words, SI segment revenue includes income from multiple businesses, from providing compute infrastructure to AI models and applications.
By breakdown, SI solutions and infrastructure brought in $7.022 billion and the advertising business $538 million. However, because solutions and infrastructure include multiple revenue sources, Grok's standalone revenue and revenue from providing compute capacity to outside customers are not disclosed separately. The segment's rapid growth therefore cannot be interpreted as coming solely from usage fees for its own AI models.
The effect of the Cursor acquisition also needs to be viewed in light of the period it was consolidated. SpaceX completed the acquisition on August 14, and revenue added to consolidated results through September 30 was $608 million. That is not revenue for the full quarter but for roughly a month and a half after the deal closed. In addition, the $60 billion equity valuation presented at the time of the acquisition differs from the $42.5 billion in accounting purchase consideration, and stock-based compensation tied to post-acquisition service is treated separately from the purchase consideration.
Investment in compute infrastructure is also expanding rapidly. According to SpaceX, nominal compute capacity rose from 1.4 GW at the end of June 2026 to 1.7 GW at the end of September. GW here is a measure of the power scale of compute facilities and does not directly indicate AI model processing performance or facility utilization. Judging whether the expansion in compute capacity is translating into revenue growth requires checking how new contracts are ramping up and how much revenue the added facilities can generate.
On the SI segment's profitability, the difference between operating profit and adjusted EBITDA also deserves attention. Operating profit for July-September was $431 million, while adjusted EBITDA reached $4.953 billion. The main items behind the gap include depreciation of $2.473 billion, regular stock-based compensation of $821 million, and acquisition-related stock-based compensation of $1.217 billion, along with acquisition-related and restructuring costs. Because adjusted EBITDA is calculated excluding these costs, it is far larger than operating profit.
What matters in this report is that the SI segment turned profitable even on an operating basis that reflects these costs. However, depreciation, stock-based compensation and similar items remain large, and the rise in adjusted EBITDA alone does not mean the investment burden on the business has eased. The challenge ahead is whether it can keep growing operating profit while absorbing the costs of expanding its compute base.
Starlink Subscribers and Revenue per User Both Rise as Connectivity Drives Profit
The Connectivity segment's operating profit rose 99% year over year to $2.367 billion, and revenue increased 69%. For its core Starlink service, consumer subscriptions rose from 12 million at the end of June 2026 to 13.6 million at the end of September. Average monthly revenue per subscription (ARPU) also rose from $66 to $69, meaning that compared with the previous quarter, subscriber growth and higher pricing advanced together.
However, ARPU is still below the $83 recorded a year earlier. Although it improved from the previous quarter, it is lower than a year ago, so it cannot be said that the long-term decline in per-user revenue has stopped. Also, the 13.6 million figure is a count of subscriptions, not the number of actual users. Under SpaceX's definition, it includes some plans for operators, while customers managed under individual contracts, such as aviation, maritime and government, are excluded.
The business and government operations are also supporting growth in the segment. Revenue in that category rose 91% year over year to $2.127 billion, contributing to revenue growth alongside the consumer business's $3.121 billion. Evaluating Starlink's growth therefore requires looking not only at consumer subscriptions and ARPU but also at business and government revenue.
In addition, the next-generation heavy-lift rocket Starship has begun to be used to expand communications capacity. According to SpaceX, Starship made its first orbital flight on Flight 14, deploying 26 next-generation Starlink V3 satellites. The downlink capacity added by this launch is said to be roughly 10 times that added by a single Falcon 9 launch of Starlink satellites. However, this is a comparison of the capacity added by satellite deployment, and it does not mean that the speeds individual users get, or launch costs, improved by the same factor.
Meanwhile, the Space segment, which handles rocket development and launches, posted an operating loss of $7 million. Research and development spending, including for Starship, was $1.225 billion, up from $849 million a year earlier. Even as Starship expands satellite transport capacity, that does not necessarily lead immediately to better profitability for the rocket business itself. Improved transport capacity and the Space segment's profitability need to continue to be evaluated separately.
Massive Investment Continues After SI Turns Profitable, With a Wide Gap in Cash Flow
SpaceX's capital expenditures for July-September 2026 reached $19.593 billion, sharply higher than $6.880 billion in the same quarter a year earlier. Of this, $16.444 billion went to the SI segment, accounting for 83.9% of company-wide capital spending. Although the SI segment has reached an operating profit, the investment needed to expand compute infrastructure remains very large.
The burden becomes even clearer in cash flow. According to page 12 of the earnings release, operating cash flow for January-September 2026 was $13.097 billion. Purchases of property and equipment, on the other hand, reached $48.069 billion, for a simple difference of $34.972 billion. This is operating cash flow minus purchases of property and equipment and is not free cash flow as SpaceX defines it, but it shows that capital spending continues to far exceed the cash generated by the core business.
As of the end of September, SpaceX held $89.855 billion in cash, cash equivalents and marketable securities combined. However, this balance alone does not show how many years the current pace of investment can be sustained. Future operating cash flow, financing conditions and the scale of capital spending will significantly change how cash on hand evolves.
The relationship between capital spending and operating profit should also be kept distinct. The amount paid to acquire facilities is not deducted in full from that quarter's operating profit; acquired assets are, in principle, depreciated over their useful lives. In fact, the SI segment has already recorded substantial depreciation. As a result, a swing to operating profit and massive cash outlays for capital investment can occur at the same time.
The focus going forward is whether the SI segment can maintain an operating profit while turning its expanded compute base into continuing revenue. If profit growth in the Connectivity segment is joined by company-wide operating cash flow approaching the level of capital spending, SpaceX would find it easier to keep expanding AI infrastructure while limiting its reliance on outside funding. This report showed that the SI segment's profitability has improved, but whether the core business's cash-generating power can support such massive investment will need to be judged in future earnings reports.