SpaceX AI Spending Hits $15.8B, Spooking Investors After IPO

SpaceX shares tumble on AI infrastructure costs

SpaceX's first quarterly earnings report as a public company revealed a company spending heavily to build artificial intelligence capabilities — perhaps too heavily for Wall Street's comfort.

The rocket and satellite company reported $15.8 billion in capital expenditures related to its xAI unit, which operates the Grok AI service, according to NBC News. That figure exceeded analyst expectations of $13.09 billion and represented more than double the spending from the previous quarter. AI-related investments accounted for the majority of SpaceX's total $18.4 billion in quarterly capital expenditures.

Despite beating revenue and earnings expectations — with most revenue coming from its Starlink satellite internet service — SpaceX shares fell 6.5% in after-hours trading Tuesday. The decline reversed a 9% gain earlier in the day.

Why it matters

SpaceX's aggressive AI spending illustrates the infrastructure arms race underway among major technology companies, but it also highlights investor anxiety about return timelines. For a company primarily known for rockets and satellites, allocating the bulk of capital spending to AI represents a significant strategic pivot that carries execution risk. The market's negative reaction suggests investors want clearer evidence that massive AI investments will generate proportional returns — a concern echoing across the technology sector as companies pour billions into computing infrastructure.

Post-IPO volatility continues

SpaceX became a multi-trillion-dollar company following its record-setting initial public offering on June 12. However, the stock quickly shed $1 trillion in value amid concerns about insider stock sales and broader questions about AI spending levels across the industry.

The company maintains a market valuation exceeding $1 trillion, keeping it among the world's most valuable companies. Shares received a boost Tuesday after SpaceX announced a partnership with Nvidia to provide additional computing power for its operations.

Merger speculation grows

Investor speculation has increased around a potential merger between SpaceX and Tesla, both controlled by Elon Musk. Such a combination would consolidate Musk's control over his technology empire, which spans electric vehicles, space exploration, satellite internet, and artificial intelligence.

The capital expenditure figures and strategic direction were first reported by NBC News in SpaceX's inaugural quarterly update to public shareholders.