Musk Weighs SpaceX-Tesla Merger Amid SpaceX Boom

Elon Musk said SpaceX and Tesla have formed special committees to examine a possible merger, which could combine the companies into a business worth about $3.5 trillion at current valuations. The proposal remains uncertain: the committees have not agreed on a plan, and Musk said any deal would need shareholder support, including approval by at least 50 percent of Tesla shareholders. He described the idea as having “a lot of merit” because the companies have complementary capabilities, but cautioned that a merger is not guaranteed. If completed, the combination would be the largest corporate merger in history, surpassing the $1.25 trillion union between SpaceX and xAI reported in February. SpaceX and Tesla are currently ranked as the world’s seventh- and eleventh-largest companies, respectively. Mergers and acquisitions expert Jerayr Haleblian of the University of California, Riverside, said the deal had a sound rationale, citing the companies’ expertise in manufacturing, robotics, artificial intelligence and energy infrastructure. He said the potential benefits would depend on innovation arising from synergies between the businesses. Markets responded positively to Musk’s remarks. SpaceX shares, following the company’s June initial public offering, rose more than 8 percent in after-hours trading, while Tesla shares gained 1.8 percent. The comments came as SpaceX reported its first quarterly profit, posting $4.4 billion for July through September, compared with a $1.05 billion loss in the same quarter a year earlier. Its profit for the first three quarters totaled $413 million, reversing a $2.59 billion loss in the corresponding period the previous year. The article attributes the quarterly improvement to growth in SpaceX’s AI and satellite-internet divisions.

The Al Jazeera Newsfeed item reports that Elon Musk said SpaceX and Tesla are considering a merger. If completed, the combination would create a company valued at $3.5 trillion, according to the report. Musk confirmed that special committees have been formed to consider the proposal. The article does not provide further details about how a merger might be structured, what the committees will examine, or whether either company has made a final decision. It also gives no timeline for the committees’ work or the possible transaction. The report is dated October 21, 2026, and presents the news as a brief update rather than a detailed analysis. It does not include comments from either company beyond Musk’s reported confirmation, nor does it explain the basis for the $3.5 trillion valuation. The central point is therefore that a merger is under consideration, not that a deal has been agreed or completed.

Elon Musk says Tesla and SpaceX are actively considering a merger, although no agreement has been reached and the companies have not guaranteed that a transaction will proceed. Speaking during a call with financial analysts about SpaceX’s quarterly results, Musk said he sees substantial merit in combining the companies. Special committees at both firms are examining the proposal, and Musk said he is excluded from them because he is a “conflicted party” as chief executive of both companies. Any merger would require shareholder approval; at least 50% of Tesla shareholders would need to support it, a threshold Musk called high. A merger would unite companies valued at approximately $1.5 trillion and $2 trillion, respectively, potentially creating one of the largest deals in history. SpaceX shares rose 8% in after-hours trading, while Tesla shares gained 2% after recently weakening. SpaceX’s businesses include rockets, Starlink satellite internet, and a growing cloud-computing service for companies including Anthropic and Google. Its cloud-computing operation generated $7.5 billion in the latest quarterly results, and Starlink brought in $5.2 billion. Despite those revenues, SpaceX overall has lost $1.1 billion so far this year. The article places the proposal in the context of Musk’s efforts to consolidate his companies and make them work more closely together. SpaceX acquired xAI and X before its public listing, and Tesla and SpaceX recently launched Terafab, a joint chip-manufacturing effort. Musk argued that a merger could support their shared work in chips, artificial intelligence, software, and other areas. Tesla, traditionally known for electric cars, has been shifting resources toward robotics, while SpaceX’s AI-infrastructure ambitions have helped it surpass Tesla in market value following its stock-market debut. The article notes that Tesla shareholders previously approved a compensation package for Musk valued at about $1 trillion, but the proposed merger would still depend on a separate shareholder decision.

CNBC’s Daily Open examines Elon Musk’s reported consideration of merging SpaceX and Tesla, alongside several other business and policy developments. At SpaceX’s third-quarter earnings call, Musk called a merger with Tesla a “good idea” and said the companies’ boards had formed special committees to discuss it. Musk said he would not participate because he is a “conflicted party,” but argued that combining the companies could create cooperation in areas such as software and chips. SpaceX exceeded expectations, reporting $14.58 billion in revenue, $2.8 billion in operating income and $4.4 billion in net income. Its chief financial officer also projected first-quarter 2027 revenue of $33 billion to $37 billion, well above analysts’ average estimate. The article also reports that Musk ordered a slowdown affecting Starlink service used by Ukraine’s military. The reported restrictions limited the speed of connected hardware and made some Ukrainian offensive and interceptor drones largely ineffective. The Wall Street Journal said Musk and President Donald Trump discussed the decision; Musk had previously said the restrictions were ultimately determined by the U.S. military and president, while Trump said he did not know who was responsible. Netflix beat third-quarter earnings expectations, but its shares fell after the company lowered its advertising outlook and forecast fourth-quarter revenue below analysts’ expectations. Separately, the Liberty Justice Center is challenging Trump’s 50% tariffs on a range of Canadian goods, representing importer Gellert Global Group. The complaint seeks to have the tariffs declared unlawful, stop their enforcement and obtain refunds for duties already paid. Finally, the Federal Aviation Administration approved Boeing’s 737 Max 10 after years of delays. The aircraft’s certification had been held up by increased scrutiny following two 737 Max crashes and other safety issues.

Elon Musk said he would support a possible merger between SpaceX and Tesla, though he stressed that no agreement has been reached and that a deal is far from certain. Independent director committees at both companies are examining the idea at shareholders’ request. Musk said he would not participate in their discussions because of a conflict of interest, and noted that approval would require a majority of all Tesla shares—a high bar. He argued that the companies could work together in areas including artificial intelligence, chip design, robotics and space-based computing. SpaceX shares rose nearly 5% in after-hours trading after his remarks. The comments came as SpaceX reported a substantial financial turnaround in its July–September quarter. Revenue increased 161% year over year to $14.6 billion, while the company recorded net income of $4.4 billion, compared with a $1.1 billion loss a year earlier. The largest source of sales was its AI division, called Super Intelligence, whose revenue rose more than ninefold to $7.6 billion, surpassing Starlink. Growth was attributed to cloud-computing contracts, broader use of the Grok chatbot and the acquisition of AI coding start-up Cursor. Customers include Anthropic and Google, both of which have agreed to large computing-power contracts. The AI unit moved to an operating profit, although SpaceX continued to spend heavily on infrastructure. SpaceX invested $19.6 billion during the quarter, including $16.4 billion in AI, and said its computing capacity had grown to 1.7 gigawatts. Musk predicted further capacity additions, while identifying power, cooling and electrical equipment as constraints. Starlink revenue rose 69% to $5.2 billion, and consumer subscribers reached 13.6 million, though average monthly revenue per consumer declined. The quarter also included Starship’s first revenue-generating flight, which carried 26 next-generation Starlink satellites into orbit. The results follow SpaceX’s June Nasdaq listing and an initially loss-making first quarter as a public company.