Elon Musk says he backs SpaceX-Tesla merger as rocket firm turns profit

Elon Musk expressed his support for a potential merger between SpaceX and Tesla during a call with analysts, following the rocket and AI company's first quarterly profit. SpaceX reported a net income of $4.4 billion for the July-September period, marking a significant turnaround from a loss of $1.1 billion a year earlier. The AI division, known as Super Intelligence, saw its revenue surge more than ninefold, reaching $7.6 billion.

This growth was driven by new cloud services agreements, increased adoption of its Grok chatbot, and the acquisition of Cursor, an AI coding startup. Shares in SpaceX rose nearly five percent in after-hours trading. Musk noted that special committees of independent directors at both companies have been set up to study the merger idea at the request of shareholders, though he cannot participate due to a conflict of interest.

The committees have not agreed on any terms, and Musk warned that a majority of all Tesla shares would be needed to secure a deal, which he described as a "quite a high hurdle." Any potential merger would combine SpaceX and Tesla's expertise in areas such as AI software, chip design, robotics, and space-based computing.