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Blue Origin rocket launch fails after engine catches fire
Blue Origin’s suborbital New Shepard rocket suffered a catastrophic engine failure during its 23rd launch attempt, ending a seven-year streak of 21 successes.
Following a handful of mostly weather-related delays that pushed New Shepard’s 23rd launch about two weeks past its original August 31st target, the single-stage vehicle lifted off from Blue Origin’s Van Horn, Texas launch site around 10:25 am CDT (14:25 UTC) on September 12th. Measuring about 15 meters (49 ft) tall, 3.7 meters (12.1 ft) wide, and capable of producing about 50 tons (~110,000 lbf) of thrust with its lone BE-3 engine at full throttle, New Shepard only made it about halfway through its nominal powered ascent before catastrophe struck.
The first signs of trouble appeared about 62 seconds after liftoff in the form of flickers and flashes in New Shepard’s exhaust, which is normally almost transparent. Less than two seconds after the first seemingly harmless flash, flames unintentionally burst from New Shepard’s engine section and quickly surrounded its BE-3PM engine. Less than a second after that, the rocket’s aft and began shedding pieces and stopped producing thrust, triggering a solid rocket motor stored inside its deployable capsule.
About a second after the incident began, the capsule’s abort motor ignited and carried the suborbital spacecraft safely away from the failing New Shepard booster. The capsule ultimately coasted to an apogee of 11.4 kilometers (7.1 miles) – almost ten times lower than nominal – before descending back to Earth, deploying its parachute system, and safely touching down in the Texas desert scrub. Thankfully, NS-23 was only carrying experiments, and no humans were at risk. Had a crew of suborbital tourists been aboard, they would have likely been a little battered but otherwise completely unharmed.
..there is room for a lot of speculation ?– i did a frame by frame Picture – on the bottom row you can see some parts falling away. maybe the nozzle fell apart?!? pic.twitter.com/OOzPkPiX6G— Flo (@FloSpacenerd) September 12, 2022
While any failure of a rocket is unfortunate, the failure of a rocket nominally designed to launch humans can have even worse repercussions. However, thanks to the seemingly flawless unplanned performance of New Shepard’s abort system, it’s safe to say that the day could have gone much worse for Blue Origin.
The failure is still not going to do the reputation of Blue Origin or New Shepard any favors. It also invites less than favorable comparisons with SpaceX, a different spaceflight startup also funded and founded by a tech tycoon in the early 2000s.
Founded a year and a half after Blue Origin, SpaceX, in comparison, reached orbit with Falcon 1 in 2008. In June 2010, it successfully debuted Falcon 9, an orbital-class rocket roughly 20 times larger. In 2012, Falcon 9 successfully launched an orbital Dragon spacecraft which became the first private vehicle to dock to the International Space Station. In January 2015, it attempted to recover a Falcon 9 booster for the first time. In December 2015, one month after Blue Origin’s first successful New Shepard landing, SpaceX aced its first Falcon 9 booster landing.
Nine months later, Falcon 9 suffered a catastrophic failure during prelaunch testing in September 2016 and didn’t return to flight until January 2017. That is where, for the most part, the paths of Blue Origin and SpaceX almost entirely diverged – but not in any obvious way. Instead, after a successful suborbital launch in October 2016, New Shepard didn’t fly again until December 2017. In the roughly six years between October 2016 and September 2022, New Shepard completed 10 uncrewed suborbital launches, 6 suborbital tourist launches, and suffered one failure during another uncrewed mission – 18 total launches.
Despite suffering a catastrophic failure that destroyed a customer’s multimillion-dollar satellite in September 2016, SpaceX returned to flight four months later, completed 150 orbital Falcon launches without fail in the same period; debuted the world’s largest operational rocket, Falcon Heavy, and completed two additional launches with it; debuted Crew Dragon and Cargo Dragon 2 on Falcon 9; launched its first astronauts into orbit, launched its first operational astronaut transport mission for NASA, launched its first two Starlink internet satellite prototypes, launched another 60 refined Starlink prototypes, began operational Falcon 9 Starlink launches, built and launched more than 3000 Starlink satellites total; landed 130+ Falcon boosters, and reuse Falcon boosters 117 times.
The differences could not be more stark or strange, given that both companies have been operating more or less side by side and working towards similar goals for as long as they’ve existed. To Blue Origin’s credit, the company managed a record six New Shepard launches – three carrying tourists – in 2021. NS-23 was its fourth planned launch in 2022, suggesting that it could have achieved a similar cadence this year if the mission had had a different fate. Instead, the launch failure has triggered an anomaly investigation that will search for the root cause and try to uncover shortcomings that will then need to be rectified before New Shepard can return to flight. Given that Blue Origin once went 15 months between successful New Shepard launches, it’s impossible to say how long that process will take.
In the meantime, the apparent failure of New Shepard’s BE-3PM engine could trigger investigations into Blue Origin’s other engine programs. While substantially different, BE-3U, a variant optimized for the upper stage of New Glenn, Blue Origin’s first orbital rocket, likely shares the most in common with New Shepard’s BE-3PM. BE-7, a small engine meant to power a Moon lander, could also be impacted.
Most importantly, Blue Origin is also in the midst of finally preparing two much more powerful and far more complex BE-4 engines for customer United Launch Alliance (ULA). Years behind schedule, Blue Origin completed the first two theoretically flightworthy BE-4 engines and began putting them through qualification testing earlier this year. It wants to ship those engines to ULA as soon as possible to avoid delaying the debut of the customer’s new Vulcan Centaur rocket. BE-3PM and BE-4 probably don’t share a single part, but many Blue Origin employees have likely worked on both programs, and the same Blue Origin leadership has certainly overseen both. As long as there’s any form of commonality, no matter how abstract, there’s always a risk that the underlying cause of problems in one program could be present in others.
Ultimately, it’s unlikely that there will be any serious connection. The New Shepard booster that failed on NS-23 was almost five years old and was flying for a record-breaking ninth time. It’s possible that Blue Origin was privately worried about the possibility of failure while pushing the envelope, but it offered no qualifications while discussing the mission. SpaceX CEO Elon Musk, in comparison, has almost always made it clear that failure is a possibility when the company attempts ‘firsts’ of any kind.
SpaceX recently launched and recovered the same Falcon 9 booster for the 14th time, setting its own internal record. As a result, that lone Falcon 9 booster, B1058, has flown as many times in the last 31 months as all New Shepard boosters combined have flown in the last 45 months.
Finally, while no company should be put in that position, Blue Origin deserves praise for its live coverage of the anomaly. Instead of immediately cutting the feeds, which would be what most providers would be expected to do during an operational launch, Blue Origin continued to broadcast views of the failure and provide live commentary until New Shepard’s capsule touched down well ahead of schedule.
Elon Musk
Elon Musk just confirmed the Tesla and SpaceX merger step everyone was waiting for
Tesla and SpaceX formed special committees to weigh a merger, and Elon Musk supports it.
Elon Musk confirmed Tuesday that Tesla and SpaceX have each formed special committees of independent directors to study a possible merger, the first formal step toward combining the two companies after months of speculation.
Musk made the disclosure during SpaceX’s third quarter earnings call. “Both SpaceX and Tesla have formed special committees to discuss this idea at the request of shareholders,” he said. “Because I’m a conflicted party, I can’t actually be in the discussions of the special committees.” He described the setup as “an odd kabuki dance where two groups of people are talking and I can’t be in the conversation.”
Musk did not hide where he stands. “Do I think it would be a good idea? Yes,” he said, pointing to shared work on super intelligence software, chip design, the Terafab facility in Austin, robotics, mass to orbit and connectivity. “I do think there’s a lot of merit to combining the companies as we are pretty much in the super intelligence singularity.”
He also tried to cool expectations. The committees have not agreed on terms for any transaction, and Musk said assuming a merger is a certainty “would be overstating it.” Any deal would go to shareholders, and on the Tesla side it would need approval from 50 percent of all outstanding shares, not just the shares that are voted. Musk called that “quite a high hurdle.”
That bar has tripped Tesla up before. The company’s 2025 attempt to declassify its board won support from only 39.4 percent of outstanding shares and failed. Musk’s own voting stake sits near 20 percent after he exercised his 2018 options in June, so a deal would need broad backing from institutions and a retail base that often leaves votes uncast.
Timing is another open question. Tesla filed its proxy statement Monday for its December 3 annual meeting, and the ballot has only three items: director elections for Musk, Robyn Denholm and JB Straubel, a say on pay vote and auditor ratification. Barclays analyst Dan Levy had argued that an announcement would need to land by late October or early November to make the annual meeting, as Teslarati noted in its SpaceX earnings preview. With no terms agreed, any vote would likely require its own special meeting.
Elon Musk gives his most telling Tesla-SpaceX merger conversation yet
Musk has been edging toward this for weeks. At the All-In Summit in September, he asked “who can imagine what action one might take when there’s so much close collaboration,” Teslarati reported. Last week’s Roadster unveil, built around SpaceX derived cold gas thrusters, pushed the talk further. The two companies already share the Terafab chip project, and Tesla holds a small SpaceX stake that came from its earlier investment in xAI.
SpaceX brought strong numbers to the conversation. It reported Q3 revenue of $14.58 billion, up 161 percent year over year, with its Super Intelligence segment now its largest at $7.56 billion. A higher SpaceX valuation would shape any exchange ratio Tesla holders are offered.
Tesla reports its own third quarter results after the close on Wednesday, October 21. Investors had already ranked merger timing among the top retail questions for SpaceX’s call, and the committees will almost certainly come up again on Tesla’s.
SpaceX reported its third-quarter 2026 financial results on October 20, posting the company’s first solidly profitable quarter since going public earlier in the year under the ticker $SPCX.
Revenue reached $14.58 billion, up 161 percent year-over-year from $5.6 billion, and well ahead of consensus estimates in the $12.7 to $12.9 billion range. The results highlight a rapid shift in SpaceX’s center of gravity toward artificial intelligence/super intelligence, while Starlink and traditional space operations continue to show robust progress.
Here are the key financial results for the quarter:
- Revenue of $14.58 billion (+161% YoY)
- Adjusted EBITDA of $8.8 billion (+306% YoY)
- GAAP net income of $4.4 billion (versus a $1.1 billion net loss in the prior-year quarter)
- Adjusted EPS of approximately $0.35 (versus roughly $0.13–0.16 expected)
- Income from operations of $2.8 billion
The AI/SI segment generated $7.56 billion in revenue, an 830 percent year-over-year increase, making it the company’s largest segment for the first time. Growth was primarily driven by the activation of major cloud services agreements, the integration of Cursor (acquired earlier in 2026), and rising usage of Grok models and the newly introduced Grok Bot personal agent.
🚨 SpaceX just reported earnings! Here are some highlights:
Financial:
Revenue $14.58B (+161% YoY) vs. consensus ~$12.7–12.9B
Adjusted EBITDA $8.8B (+306% YoY)
GAAP net income $4.4B (vs. prior-year loss; first solidly profitable quarter post-IPO)
Adjusted EPS ~$0.35 vs. ~$0.13–0.16 expectedSegments:
Super Intelligence (SI, formerly AI): $7.56B (+830% YoY) — now the largest segment, driven by cloud contracts, Cursor, and Grok.
Connectivity (Starlink): $5.25B (+69% YoY).
Space: $1.77B.Other highlights:
Starlink subscribers: 13.6M (+89% YoY).
Nameplate compute: 1.7 GW.
Capex: $19.6B (majority AI infrastructure).
Cash & marketable securities: ~$90B.
First revenue-generating Starship mission (26 V3 Starlink satellites, ~10× Falcon 9 downlink capacity per launch).— TESLARATI (@Teslarati) October 20, 2026
SI adjusted EBITDA reached $5 billion, and nameplate compute capacity stood at 1.7 GW at quarter-end, up from 1.4 GW in June and 0.6 GW a year earlier. Capital expenditures totaled $19.6 billion, with the majority allocated to AI infrastructure, including continued expansion of the Colossus facilities.
The Connectivity segment, which primarily surrounds Starlink, produced $5.25 billion in revenue, a 69 percent year-over-year and 22 percent sequentially. These are pleasant results to see and expected, considering how many airlines have adopted Starlink over the past year.
Starlink consumer subscribers reached 13.6 million, an 89 percent increase from the prior year, and a sequential gain of 1.6 million. Consumer average revenue per user improved to $69. Meanwhile, Enterprise and Government revenue also grew strongly, and Starlink is now installed on more than 3,800 aircraft, making internet more accessible and better performing than previous options.
The Space segment also performed well and contributed $1.77 billion in revenue, up 6 percent year-over-year and 84 percent sequentially. A major milestone was the successful first revenue-generating Starship mission (Flight 14), which deployed 26 V3 Starlink satellites. Those satellites added roughly 10 times the downlink capacity of a typical Falcon 9 Starlink launch.
SpaceX completed 12 customer launches during the quarter, including NASA’s Nancy Grace Roman Space Telescope mission, and continued to grow its backlog of crewed, national security, and commercial flights.
CFO commentary noted that the combination of launch leadership, recurring Starlink revenue, and rapid SI expansion is producing meaningful operating leverage.
The company ended the quarter with roughly $90 billion in cash and marketable securities, providing substantial resources for ongoing investment while targeting an investment-grade balance sheet. Sequential revenue nearly doubled from the $7.81 billion reported in the second quarter, illustrating the pace of the AI-driven acceleration. Things are looking strong for SpaceX.
What’s incredibly striking is the fact that SI has grown to be larger than the rest of the company in such a short amount of time. CEO Elon Musk said on the earnings call that Grok Bot is the “fastest-growing product I’ve ever seen,” so it seems that it could be a true keystone of SpaceXSI over the next few years.
SpaceX (NASDAQ: SPCX) will report its second public earnings call today since its IPO earlier this year, and there are a few things we expect to hear about, as well as Wall Street analysts, who have already outlined their expectations for the call.
Wall Street analysts have a consensus of $12.72 billion in revenue and an earnings per share (EPS) of $0.13. These are broken down into three sectors: Space, Connectivity, and AI/SI, which are perceived in this way:
- Space: $1.41 billion
- Connectivity: $4.84 billion
- AI/SI: $6.47 billion
Other outlets cluster near $12.8 or $12.9 billion in revenue and $0.14 – $0.15 EPS. This implies a roughly 65 percent sequential growth from Q2’s $7.81 billion, driven mostly by AI/SI, with the first post-IPO positive EPS expected.
Here are the three things to watch for on the call:
AI Revenue Ramp and the $100B+ ARR target
AI is truly the swing factor for SpaceX, and analysts expect it to roughly double from Q2’s $2.56 billion and become about half of total revenue. Management previously guided to a $100 billion+ annualized run rate by December, including the Cursor acquisition, which was $60 billion, to close the quarter.
Listen for updates on SpaceX’s compute capacity, especially pertaining to its contracts with Google, Anthropic, and others, revenue per watt, any new deals, and Cursor’s early contribution.
Starlink/Connectivity Metrics and Mobile Expansion
Connectivity remains a main profit engine for SpaceX. Subscriber additions will be something to pay attention to, as Q2 ended at 12 million and previews are looking at 14 million for this quarter. Additionally, ARPU trends, enterprise and government growth, and any commentary on Starlink Mobile will be something to pay attention to, especially following the recent low-band spectrum deal and FCC-related constellation approvals.
Capex Trajectory, Cash Burn/FCF, and Starship/Operational Updates
Q2 capex of roughly $18.4 billion weighed on the stock. Investors will look to scrutinize Q3 spending levels, any guidance on the pace into Q4/2027, free cash flow, backlog, and liquidity. Operational color on Starship (Flight 14 milestones and Flight 15 timing/reusability progress), Falcon cadence, and government/NASA contracts are also in focus.
Of course, there will also be some speculation on the potential Tesla-SpaceX merger, but there was nothing mentioned in the company’s proxy it sent earlier this week.
SpaceX will report earnings after market close today and will stream the call on X.
Watch live as SpaceX discusses our Q3 2026 earnings at 3:30pm CT today → https://t.co/Qrb0qeVG15
— SpaceX (@SpaceX) October 20, 2026
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