SpaceX earns more from AI than from Starlink; Craig Moffett asks what the dot-com bubble taught
One Stratechery interview: the telecom analyst Craig Moffett on SpaceX's launch, broadband and mobile businesses and the dot-com bubble question, with the quarter's numbers that decide which way it goes.
One item landed in your reading queue since yesterday's edition: Stratechery's Thursday interview, with the telecom analyst Craig Moffett, on SpaceX and on bubbles 1. Lenny's Newsletter published nothing in the window. Its newest item is still Wednesday's Claude Duet episode, covered in yesterday's edition 2.
The interview is subscriber-only. The public page gives one summary line and then the Stratechery Plus block, and the site's own account marks the post with a dollar sign 13. So nothing below puts an argument in Moffett's mouth.
What the public record does settle is the company under discussion. This month it stopped being a rocket company with a satellite business attached.
The biggest business is no longer the one with the rockets
"An Interview with Craig Moffett About SpaceX and Bubbles" — Stratechery, Ben Thompson
Published October 22, 2026, 18:00 Shanghai. Interview. Subscriber-only. 1
The summary line names the four subjects: launch, broadband, mobile, and how Moffett is applying the lessons of the dot-com bubble to today 1.
- One quarter, three businesses, one clear winner. SpaceX reported $14.58 billion of revenue for the third quarter, up 161% from a year earlier 4. Its AI segment, now called Super Intelligence, booked $7.56 billion of that, nine times its $813 million a year earlier 4. Starlink's connectivity segment booked $5.25 billion, up 69% 4. Launch booked $1.77 billion, barely moved from $1.67 billion 4.
- Mobile is the newest and least proven of the three. On October 8 SpaceX agreed to buy up to 14 megahertz of paired low-band spectrum from Grain Management, pending FCC approval, and said it closes "one of the key remaining technical gaps" to becoming a major US carrier 6. AT&T, Verizon and T-Mobile all fell on the news. Moffett's public position on that, given the next day on CNBC, is the title of his segment: the market is overreacting 7.
| Segment | Q3 2026 revenue | Growth, year over year | Operating income |
|---|---|---|---|
| Super Intelligence (AI) | $7.56B 4 | Nine times 4 | $431M 5 |
| Connectivity (Starlink) | $5.25B 4 | +69% 4 | $2,367M 5 |
| Space and launch | $1.77B 4 | +6% 4 | −$7M 5 |
| Total | $14.58B 4 | +161% 4 | $2,791M 5 |
The dot-com parallel has arithmetic behind it this time, and the arithmetic fits in two lines. Capital spending in the quarter was $19.59 billion, more than the whole company brought in, and $16.44 billion of that went to the AI segment 5.
Management then guided the first quarter of 2027 to between $33 billion and $37 billion of revenue, against an analyst consensus of $22.2 billion 4. Musk went further on the call, putting annual recurring revenue at $500 billion to $1 trillion by the end of next year, against analyst forecasts of about $110 billion for all of 2027 4.
The market has been marking this trade down while the argument runs. CoreWeave and Nebius are down 28% in October, IREN about 35%, and Firmus withdrew a planned IPO citing volatility 4. At the end of the second quarter SpaceX's debt and finance leases stood at $36.8 billion, up from $22 billion three months earlier 4.
Its own stock traded at $147.50 on Tuesday afternoon, a market capitalisation of about $2 trillion, roughly 34 times the quarter's revenue annualised, and below the $150 it opened at on June 12 4. On the same call Musk called a merger with Tesla a "good idea", and said both boards have formed special committees of independent directors with himself excluded as a conflicted party 4.
Where to start
Subscribers should listen to the last of the four subjects first. Launch, broadband and mobile are the parts of SpaceX you can already price; the dot-com parallel is the part Moffett brings 1.
Everyone else has a usable substitute. Moffett's October 9 segment runs five minutes, needs no subscription, and states his read on the mobile threat directly 7.
Read the table before either. If AI revenue keeps growing at this rate while its segment profit stays under half a billion dollars a quarter, one answer follows; if profit tracks revenue next quarter, the other does.
The spectrum deal itself was covered here on October 14, so what is new in this entry is the quarter and the analyst's verdict. The queue refills when Stratechery posts again.
References
- 1
- 2Lenny's Newsletter feed
lennysnewsletter.com
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- 4
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- 7
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