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SpaceX CEO Elon Musk explains how Starships will return from orbit
In the near future, SpaceX wants to begin putting its first two full-scale Starship prototypes through a series of increasingly challenging test flights, eventually culminating in their first Super Heavy-supported orbital launch attempts.
SpaceX CEO Elon Musk took to Twitter over the last 48 or so hours to answer a number of questions about how exactly Starship is meant to make it through orbital reentries – by far the most strenuous period for the ship and without a doubt the single most challenging engineering problem SpaceX must tackle.
Discussed yesterday on Teslarati, SpaceX technicians began the process of attaching numerous Tesla Model S/X battery packs to a subcomponent that will eventually be installed inside Starship Mk1’s nose, offering a storage capacity of up to 400 kWh. The need for all that power (Crew Dragon relies on a few-kWh battery) is directly related to Starship Mk1’s methods of reentry and recovery, recently described in detail by Elon Musk.
As noted above, ~400 kWh of batteries are needed to power the electric motors that will actuate Starship’s massive control surfaces – two large aft wings and two forward canards/fins. According to Musk, Starship’s “stability is controlled by (very) rapid movement of rear & fwd fins during entry & landing”, meaning that the spacecraft will need to constantly tweak its control surfaces to remain in stable flight.
By far the biggest challenge SpaceX faces is ensuring that Starship can survive numerous orbital-velocity reentries with little to no wear and tear, a necessity for Starship to be cost-effective. In Low Earth Orbit (LEO), Starship will be traveling no less than 7.8 km/s (Mach 23, 17,500 mph) at the start of atmospheric reentry. In simple terms, the process of slowing from orbital velocity to landing on Earth involves turning the vast majority of that kinetic energy into heat. As Musk noted yesterday, this reality is just shy of unavoidable but there is some flexibility in terms of how quickly one wants to convert that energy into heat.
The fastest route to Earth would involve diving straight into the atmosphere, dramatically increasing peak heating on a spacecraft’s surface to the point that extremely exotic heat shields and thermal protections systems become an absolute necessity. SpaceX wants to find a middle ground with Starship in which the spacecraft uses its aerodynamic control surfaces and body to generate lift, slowly and carefully lowering itself into Earth’s atmosphere over a period of 15+ minutes. Musk notes that this dramatically lessens peak heating at the cost of increasing the overall amount of energy Starship has to dissipate, a bit like cooking something in the oven at 300 degrees for 30 minutes instead of 600 degrees for 10 minutes.
To an extent, Starship’s reentry profile is actually quite similar to NASA’s now-retired Space Shuttle, which took approximately 30 minutes to go from its reentry burn to touchdown. Per the above infographic, it looks like Starship will take approximately 20 minutes from orbit to touchdown, owing to a dramatically different approach once it reaches slower speeds. Originally described by Musk in September 2018 and again in recent weeks, Starship will essentially stall itself until its forward velocity is nearly zero, after which the giant spacecraft will fall belly-down towards the Earth, using its wings and fins to maneuver like a skydiver. The Space Shuttle landed on a runway like a (cement-encased) glider.
This unusual approach allows SpaceX to sidestep the need for huge wings, preventing Starship from wasting far more mass on aerodynamic surfaces it will rarely need. The Space Shuttle is famous for its massive, tile-covered delta wing and the leading-edge shielding that partially contributed to the Columbia disaster. However, it’s a little-known fact that the wing’s size and shape were almost entirely attributable to US Air Force demands for cross-range performance, meaning that the military wanted Shuttles to be able to travel 1000+ miles during reentry and flight. This dramatically constrained the Shuttle’s design and was never once used for its intended purpose.
SpaceX thankfully doesn’t have its own “US Air Force” stand-in making highly consequential demands (aside from Elon Musk ?). Instead, Starship will continue the SpaceX tradition of vertical landing, falling straight down – a bit like a skydiver (or a brick) – on its belly and flipping itself over with fins and thrusters for a propulsive vertical landing. In this way, Starship doesn’t have to be a brick forced to fly, like the Shuttle was – it just needs to be able to stably fall and quickly flip itself from a horizontal to vertical orientation.
Additionally, Starship is built almost entirely out of steel, whereas the Shuttle relied on an aluminum alloy and needed thermal protection over every square inch of its hull. Steel melts at nearly twice the temperature of the Shuttle’s alloy, meaning that Starship will (hopefully) be able to get away with nothing more than ceramic tiles on its windward half, saving mass, money, and time. Once Starship completes its first 20 km (12.5 mi) flight test(s), currently scheduled no earlier than mid-October, SpaceX will likely turn its focus on verifying Starship’s performance at hypersonic speeds, ultimately culminating in its first orbital-velocity reentries.
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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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