SpaceX
SpaceX’s first Starship engine suffers “expected” damage during Raptor test fire
SpaceX CEO Elon Musk says that the first full-scale Starship engine to be tested has already been pushed to the point of damage less than three weeks after the campaign began, setting the stage for the second full-scale Raptor to take over in the near future.
According to Musk, while most of the damaged pathfinder Raptor’s components should still be easily reusable, the assembly of the second finalized engine is “almost done” and that Raptor will take over near-term testing rather than waiting for repairs to the first engine. This is undoubtedly an extraordinarily aggressive test program, particularly for such a new and cutting-edge rocket propulsion system, but these latest developments are ultimately far more encouraging than they are concerning.
Merlins. The max chamber pressure run damaged Raptor SN 1 (as expected). A lot of the parts are fine for reuse, but next tests will be with SN 2, which is almost done.
— Elon Musk (@elonmusk) February 21, 2019
Although the Raptor engine family began integrated subscale static fires way back in September 2016, SpaceX’s propulsion team finalized Raptor’s baseline design and completed assembly, shipment, and an integrated static fire of the first full-scale engine on February 3rd, considerably less than three weeks before Musk took to Twitter. Aside from confirming that the new Raptor had been damaged during its most recent static fire several days prior, Musk indicated that the failure (unsurprisingly) was primarily attributed to the engine reaching the highest chamber pressures yet.
Raptor’s main combustion chamber (the bit directly above the nozzle) has been designed to nominally operate at and reliably withstand extraordinary pressures of 250+ bar (3600+ psi), performance that demands even higher pressures in the components that feed hot methane and oxygen gas into Raptor’s combustion chamber. One prime example hinted at by Musk in a 2018 tweet is its oxygen preburner, used to convert liquid propellant into a high-velocity gas that can then feed a dedicated oxygen turbopump. Aside from the absurdly corrosive environment created by extremely hot gaseous oxygen, the preburner must also survive pressures that could peak as high as 800+ bar, or 12,000 psi.
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- SpaceX’s world-class rocket propulsion team has been progressing through early full-scale Raptor tests at an incredible speed. (SpaceX)
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- Full-scale Raptor’s first static fire test, February 3rd. (SpaceX)
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- Raptor’s business end with a Musk-for-scale. (Elon Musk)
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- Starship revealed a trio of Raptor mockups when SpaceX technicians moved the assembly from stand to ground. (NSF – bocachicagal)
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- A September 2018 render of Starship (then BFS) shows one of the vehicle’s two hinged wings/fins/legs. (SpaceX)
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- BFR (2018) breaks through a cloud layer shortly after launch. (SpaceX)
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A lack of technical detail means that it’s hard to know what thrust or main chamber pressure Musk had in mind when referring to exotic alloys that would be needed to survive those pressures, but the performance statistics of a Raptor with a preburner operating at 800+ bar would probably outstrip anything Musk has thus far described. In other words, it’s safe to assume that Raptor has probably not been pushed to those performance levels just yet, although it’s still a distant possibility. More likely is that 800+ bar in the oxygen preburner is an extreme stretch-goal that will take concerted research, development, and optimization to achieve, with Raptor having suffered damage somewhere below those levels while still reaching eye-watering performance figures.
— Elon Musk (@elonmusk) February 4, 2019
For an engine as complex as Raptor, there are countless dozens of potential failure modes the appearance of which would come as little surprise for an engine just days into full-scale testing. Above all else, the Raptor test schedule held by SpaceX’s world-class propulsion team – be it self-motivated or driven by reckless management-by-spreadsheet – has been fast-paced in the extreme, taking the first high-performance Raptor ever built from standstill to more than 90% thrust and chamber pressures of almost 270 bar (3900 psi) in – quite literally – less than one week. In the same period of time, more than half a dozen static fire tests (ranging from 1-10 seconds) were performed.
Within a few days of that February 10th milestone, in which Raptor reached chamber pressures comparable with the most advanced modern engines (namely RD-180/190/191), the engine was apparently pushed dramatically higher still, reaching a chamber pressure (and thus thrust) that wrought damage on some of the more sensitive parts of the engine’s plumbing. Despite the fact that the second production Raptor is apparently already “almost done”, Musk suggested that it would already feature changes (of unknown gravity) to mitigate the failure modes experienced by Raptor SN01.
SN2 has changes that should help
— Elon Musk (@elonmusk) February 21, 2019
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In an industry where NASA and contractors like Aerojet-Rocketdyne will spend months between static fire tests of Space Shuttle engines that have each literally flown multiple (if not) dozens of missions to orbit and have a demonstrated performance and reliability record that is measured in the hundreds of thousands of seconds, the speed and agility of SpaceX’s Raptor development and test program is breathtaking. What remains to be seen is just how comparably reliable and successful the end results (i.e. operational Raptor) will be, but an attitude that actively accepts and even pursues testing to destruction can ultimately only serve to benefit the finished product at the cost of destroyed hardware and many on-ground lessons learned the hard ways.
Given the immense success of SpaceX’s Merlin family of engines and the aggressive strategy of development and continuous improvement that brought it from Merlin 1A to 1D and MVacD, SpaceX is clearly not fumbling around in the dark when it comes to Raptor R&D.
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News
SpaceX just launched a secret payload from California
SpaceX launched a classified Space Force mission from Vandenberg, revealing almost nothing about its payload.
SpaceX launched a classified Falcon 9 mission for the U.S. Space Force from Vandenberg Space Force Base on Saturday night, and the government released almost nothing about what was on board. The mission, designated USSF-366, lifted off from Space Launch Complex 4E with a window that opened at 9:52 p.m. ET and ran into the early hours of Sunday, according to SpaceX’s own mission page, which described the payload only as classified. SpaceX confirmed the launch on its X account and pointed viewers to a livestream that began roughly ten minutes before liftoff.
Watch Falcon 9 launch the USSF-366 mission from pad 4E in California https://t.co/FFEzeYOds1
— SpaceX (@SpaceX) August 16, 2026
The lack of detail did not stop analysts from filling in the blanks. Independent tracking of the rocket’s stage drop zones matched the pattern SpaceX has used on previous Starlink Group 15 missions, according to reporting from Outer Space Today, which pointed to Starshield as the likely payload rather than a one off government satellite. Starshield is SpaceX’s national security product, a version of the Starlink satellite bus built to Pentagon specifications for earth observation, communications and hosted payloads. Unlike consumer Starlink, government agencies do not have to disclose what Starshield satellites are actually doing once they reach orbit.
USSF-366 is the latest entry in a steady flow of classified and semi classified work between SpaceX and the Space Force. The company picked up a $178.5 million task order in April to launch missile tracking satellites for the Space Development Agency, as Teslarati reported at the time, and followed that in July with a $1.6 billion award covering 18 more Falcon 9 missions from Vandenberg through the end of 2027, also detailed by Teslarati. Add those contracts up and SpaceX’s Pentagon business for 2026 alone tops $8 billion.
SpaceX scores another massive Pentagon deal to support military satellites
The Falcon 9 that flew Saturday landed back near the launch site, producing the sonic booms that have become routine for residents near Vandenberg. What is less routine is how little the public will likely ever learn about what the rocket carried. SpaceX and the Space Force have not confirmed the Starshield connection, and government satellite programs built on commercial buses rarely get identified beyond a mission number and a general orbit. For a company that live streams almost everything else it does, from Starship test flights to Optimus robot demos, USSF-366 is a reminder that some of SpaceX’s busiest work now happens entirely out of public view.
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Elon Musk
SpaceX’s next trillion dollar bet has nothing to do with rockets, Musk tells staff
Elon Musk told SpaceX staff AI revenue will soon dwarf rockets and Starlink combined entirely.
Elon Musk told SpaceX employees this week that artificial intelligence, not rockets, will soon carry the company’s revenue. In a roughly 29 minute internal address posted on SpaceX’s X account on Tuesday, Musk said AI revenue will pass every other line of business at SpaceX “probably in September” and pull further ahead by the fourth quarter.
The numbers he gave are specific. SpaceX currently runs 1.4 gigawatts of AI compute capacity. Musk wants that at 10 gigawatts by the end of 2027, a jump he tied directly to revenue: “if we bring 10GW of AI online by the end of next year, it will be $300 billion to $500 billion a year in revenue.” He called those “big numbers,” which undersells a projection larger than what most countries produce in a year.
We made rockets reusable and are rebuilding the internet in space. The next challenge: making life multiplanetary and understanding the true nature of the universe
Watch @ElonMusk deliver a company update to @SpaceX employees pic.twitter.com/5c8rxoCQfu
— SpaceX (@SpaceX) August 11, 2026
Musk went further on where AI fits into SpaceX’s future. “Probably in four or five years, AI will be 99% of the value of SpaceX,” he told staff, adding that digital intelligence would eventually run “a trillion times” ahead of biological intelligence as computing scales. He tied that growth to the company’s founding mission, telling employees “we must win on AI, because the future is overwhelmingly AI and robots,” with the payoff meant to help fund Starship and a Mars program that increasingly runs through Terafab, the joint Tesla, SpaceX and xAI chip plant.
Elon Musk launches TERAFAB: The $25B Tesla-SpaceXAI chip factory that will rewire the AI industry
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None of this is entirely new territory. SpaceX told investors much the same story during its first earnings call as a public company on August 4, where Musk moved the company’s $1 trillion revenue target up a year to 2030 and said Starlink could someday carry a majority of the world’s internet. What the all hands video adds is a hard deadline and a specific power figure Musk had not given publicly before, along with a franker pitch to his own workforce that AI, not launch cadence, is now the thing SpaceX is betting its future on.
The AI revenue itself is not coming from SpaceX training its own models. It is largely Starlink acting as the network layer for xAI’s workloads, plus SpaceX renting out compute capacity directly, the same approach behind the roughly $16 billion the company spent on AI infrastructure in a single quarter.
Musk closed the video with a pitch aimed at recruiting and retention rather than investors, telling employees that anyone who helps SpaceX win the AI race will eventually get the chance to go to the moon or Mars themselves. Whether SpaceX can turn 1.4 gigawatts into 10 in seventeen months is the more immediate question, and one that will show up in quarterly numbers well before anyone leaves Earth.
SpaceX’s massive investment in AI will make it a big winner, Argus Research said after the company’s successful earnings call last week.
The firm also upgraded shares to a Buy from Hold and set a $160 price target.
SpaceX (NASDAQ: SPCX) is currently recovering from its heavy AI infrastructure investments, as it spent nearly $16 billion in Q2 alone. The company did this primarily by monetizing high-demand GPU compute capacity at a much faster pace than traditional data center economics would suggest.
Company CFO Bret Johnsen said that SpaceX would be able to pay back anything on new deployments within a year.
There are plenty of ways the company can do this:
Leasing excess compute capacity through contracts
SpaceX has already built Colossus and Colossus II, largely for its own model training. However, much of that capacity is already rented out to third parties. It already has major deals with Anthropic, Google, and Reflection AI. These partnerships are adding billions per month to SpaceX’s spreadsheet.
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High utilization driven by industry-wide scarcity
The demand for advanced AI training and inference capacity continues to exceed what is available for use. SpaceX can fill new racks quickly after they come online, so the capital deployed converts into revenue with minimal idle time.
Additionally, management and outside observers have described the new compute capital as behaving more like a cost-of-goods-sold than traditional multi-year capex, especially because of this rapid monetization pattern.
Capacity has already scaled from ~0.4 GW a year to 1.4 GW annually by the end of Q2. There are targets of more than 2 GW by year-end.
High incremental margins on the rental business once capacity is online
GPU cloud providers often operate at strong gross margins. SpaceX can monetize capacity that was already partially built or can be added efficiently. This means that incremental EBITDA margins on the rental revenue are usually high. This accelerates cash recovery relative to the gross capital outlay.
Parallel monetization of its own AI software and applications
Beyond pure infrastructure rental, SpaceX also generates revenue from Grok through subscriptions and usage, from X through ads, data, and other related services, enterprise APIs, and the planned integration of the Cursor coding tools acquisition.
These application layers ride on the same compute infrastructure and provide additional high-margin streams that could offset build-out costs. AI-segment revenue overall rose sharply to about $2.6 billion in Q2, according to Motley Fool. This was driven primarily by the infrastructure contracts, but the software side is also partially responsible.
Efficient, large-scale deployment and vertical integration advantages
SpaceX has emphasized the rapid construction of power and cooling infrastructure and favorable cost-per-megawatt economics relative to industry benchmarks in some disclosures.
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Combined with its ability to scale capacity aggressively and the fact that many contracts start generating revenue within months of capacity coming online, the effective payback compresses dramatically compared with more conventional multi-year data-center projects.
SpaceX’s dominant near-term recovery path will turn the AI clusters into a hyperscale-style compute rental business for other leading AI companies while still using a portion for internal models.
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