Welcome to Staten News — where the rocket company is now mostly a computing company, and the streaming company is mostly an ad company that hasn't hit its ad numbers.
SpaceX reported its third quarter Tuesday night. Revenue came in at $14.6 billion, up 161%, against roughly $12.7 billion to $12.9 billion expected. Net income was $4.4 billion, or 35 cents a share, after a $541 million loss in the second quarter.
The biggest line on the sheet wasn't Starlink. It wasn't rockets either.
🛰️ The Rocket Company Rents Out Computers Now
SpaceX's AI unit, now called Super Intelligence, brought in $7.56 billion, per Fortune and Investing.com. That's more than Starlink. The unit includes computing power rented out to Anthropic and Google.
Starlink and related services did $5.25 billion, up 69%. Strong, but it added only 1.6 million consumer subscribers against 2.29 million expected. The satellite business is still growing. It just isn't the headline anymore.
The spending is wild too. SpaceX spent $19.6 billion in the quarter, and $16.4 billion of it went to AI and data centers.
That's not a launch company with a side hustle. That's a cloud provider with its own rockets.
The stock climbed more than 9% before Wednesday's open, per Reuters. Musk also said SpaceX and Tesla have each formed special committees to discuss a possible merger. No terms, no timeline, no deal. Just a sentence from Musk that turns Tesla's earnings call tonight into a two-company event.
⚔️ Who This Hurts
If SpaceX is selling compute to Anthropic and Google, it's competing for the same contracts as CoreWeave and Oracle. CoreWeave has fallen more than 40% since October 6 on worries about how much it has borrowed, per Yahoo Finance.
Here's the difference. CoreWeave borrows to build. SpaceX just showed it can print $4.4 billion in a quarter while it builds.
The market noticed the gap somewhere else too. Elice, a South Korean AI data-center company, fell 32% in its Seoul debut on Tuesday after raising about $151 million, per Yahoo. Investors want AI infrastructure. They just want it attached to a balance sheet that can carry it.
📺 Netflix Built an Ad Business. It's Smaller Than Planned.
Netflix's own shareholder letter tells the story. Third-quarter revenue grew 12% to $12.87 billion. Operating margin jumped to 34.6% from 28.2%. EPS rose to 87 cents from 59 cents.
Then the forward numbers. Netflix cut its 2026 ad revenue forecast to about $2.7 billion from about $3 billion. It trimmed its 2026 cash flow forecast to about $12 billion from $12.5 billion. Its fourth-quarter guide of $13.4 billion came with a 26% margin that includes roughly 1.2 points of costs from "recently announced headcount reductions."
Translation: the ad tier is growing slower than the pitch deck said, and Netflix is cutting staff to protect the margin. It still bought back a record $4.8 billion of stock in the quarter.
The stock fell hard before Wednesday's open.
🌙 Tonight's Tests
Tesla, Meta and IBM all report after Wednesday's close. Tesla now has a merger storyline sitting on top of its car numbers. Meta has to explain its own AI spending to a market that just watched CoreWeave lose 40%.
This is the week tech finds out whether AI spending gets rewarded or punished. SpaceX got rewarded because the money is already coming back. Everyone reporting tonight has to prove theirs is too.
Sources: Netflix Q3 2026 shareholder letter, Fortune on SpaceX Q3, Investing.com on SpaceX Q3, Yahoo Finance live coverage
— The Bandicoots 🚀💻