Space Exploration Technologies Corp. (NASDAQ: SPCX) just delivered a quarter that rewrites how investors should think about its business. Revenue hit $14.6 billion, up 161% from $5.6 billion a year ago and well above the $12.9 billion consensus. Net income swung to $4.4 billion from a $1.1 billion loss in Q3 2025. Diluted EPS of $0.35 compared with a $0.36 loss per share last year and topped the $0.14 estimate by more than double.
The headline figures grab attention. The composition tells the real story.
The Super Intelligence (SI) segment, previously reported as AI, generated $7.6 billion in revenue, up 830% year-over-year and 195% sequentially. That segment alone accounted for more than half of total revenue. SI solutions and infrastructure revenue, which excludes advertising, exploded to $7.0 billion from $359 million a year ago. The Cursor acquisition, closed August 14, contributed $608 million in revenue during the stub period. The bulk of the growth came from cloud services agreements and Grok adoption.
Connectivity, the Starlink business, added $5.2 billion, up 69% year-over-year and 22% sequentially. Starlink consumer subscribers reached 13.6 million, up 1.6 million from June, while ARPU improved to $69 from $66. Enterprise and government revenue grew 91% year-over-year to $2.1 billion. The higher-margin commercial and institutional channels are accelerating faster than the consumer base. Income from operations in Connectivity grew 99% to $2.4 billion, and segment Adjusted EBITDA hit $3.5 billion, an 82% increase.
SI turned profitable at the operating line for the first time in its history as a reported segment, posting $431 million in income from operations. That number includes $1.2 billion in share-based compensation from the Cursor acquisition. The underlying operating performance was even stronger. SI Adjusted EBITDA reached $5.0 billion, up from a $428 million loss a year ago. Nameplate compute expanded to 1.7 GW, up from 1.4 GW in June and 0.6 GW a year ago, as the buildout of COLOSSUS II continues.
Space segment revenue was $1.8 billion, up 84% sequentially but only 6% year-over-year. The segment posted a $7 million operating loss, swinging from a $259 million profit a year ago, as R&D spending on Starship surged to $1.2 billion from $849 million. The first revenue-generating Starship mission, delivering 26 Starlink V3 satellites with roughly 10x the downlink capacity of a Falcon 9 launch, is a milestone that will take quarters to scale into meaningful revenue. The segment's Adjusted EBITDA of $357 million was down from $674 million a year ago.
Capital allocation is the subtext of this quarter. SpaceX raised $85.7 billion in net proceeds from its IPO during the nine-month period, and total debt and finance leases have grown to $38.8 billion from $22.9 billion at year-end. The company is spending aggressively: total capex was $19.6 billion in Q3 alone, with SI capex consuming $16.4 billion. That is more than the entire company's revenue two years ago. The balance sheet remains investment-grade, with $51.3 billion in cash and $38.6 billion in marketable securities. The pace of cash burn in investing activities ($84.6 billion year-to-date) is extraordinary. Operating cash flow of $13.1 billion year-to-date covers less than a third of that.
The Cursor acquisition, valued at $60 billion in implied equity, added $42.5 billion in GAAP purchase consideration and $23.4 billion in equity awards tied to post-acquisition service. Goodwill ballooned to $48.4 billion from $11.8 billion at year-end. The integration risk is real. The early revenue contribution suggests the strategic rationale is playing out faster than skeptics expected.
The 800 MHz spectrum acquisition, announced after quarter-end, signals that Starlink Mobile is the next frontier. The deal, expected to close in the first half of 2027, adds low-band spectrum that could enable direct-to-device connectivity at scale. It is a long-term bet that will require regulatory approvals and significant investment. It aligns with the company's pattern of building infrastructure before demand materializes.
What this quarter makes clear is that SpaceX is no longer a launch company that happens to have a satellite business. The SI segment has become the primary growth engine, and the Connectivity segment is generating the cash flow to fund it. The challenge ahead is whether the company can sustain this pace of capital deployment without diluting returns. With $1.7 GW of compute capacity and a pipeline of cloud services agreements, the demand side looks robust. The question is whether the supply side can keep up without breaking the balance sheet.