Overview of Space Exploration Technologies' 2025 Performance

SpaceX's revenue grew 33.2% to $18.7B in 2025, driven by strong growth in its Connectivity segment. However, the company swung to a consolidated operating loss of $(2.6)B from operating income of $466M in 2024. The loss was driven by a massive increase in investments, particularly in the AI segment, which is building out large-scale data center infrastructure, and in the Space segment, which accelerated the development of the Starship launch vehicle.

The company's financial results for all periods presented reflect the retrospective combination of SpaceX with xAI and X Holdings, which were acquired in transactions between entities under common control.

Key performance drivers in 2025 included:

• Connectivity: The Starlink business continued its rapid expansion, with revenue growing 49.8% to $11.4B. This was fueled by a near doubling of Starlink subscribers to 8.9M, which more than offset a decline in average revenue per user (ARPU) as the service expanded internationally. The segment's operating income more than doubled to $4.4B in 2025.
• AI: This segment, which includes the Grok AI model and the X platform, saw revenue grow 22.2% to $3.2B. However, it recorded a significant operating loss of $(6.4)B in 2025 as the company made substantial investments in compute infrastructure. R&D expenses in the segment increased to $5.1B, primarily for GPU hardware depreciation and data center costs.
• Space: The launch segment's revenue grew 7.6% to $4.1B. The segment's profitability declined, posting an operating loss of $(657)M in 2025, as R&D spending on the Starship program increased to $3.0B.
• Capital Expenditures: Total capital expenditures nearly doubled to $20.7B in 2025, with the AI segment accounting for the majority of the spending ($12.7B) to build out data centers.

Connectivity: Starlink Growth Drives Profitability

The Connectivity segment was the primary driver of SpaceX's revenue growth and profitability in 2025.

• Revenue Growth: Segment revenue increased 49.8% to $11.4B in 2025. Growth was driven by a $2.4B increase in revenue from consumer subscribers and a $1.4B increase from enterprise and government customers.
• Subscriber Expansion: The growth in consumer revenue was fueled by a 99.9% increase in Starlink Subscribers, reaching 8.9M by the end of 2025. This subscriber growth was partially offset by an 11.2% decline in monthly Starlink Subscriber ARPU to $81 in 2025, which the company attributes to international expansion and the introduction of lower-priced service plans.
• Enterprise and Government: Revenue from enterprise and government customers grew, driven by a $1.2B increase in the enterprise connectivity business, which includes mobile connectivity, and a $193M increase in government business.
• Profitability: The segment demonstrated strong operating leverage, with income from operations increasing 120.4% to $4.4B in 2025. This was partially offset by higher costs, including a $827M increase in depreciation from capitalized launch and satellite costs as the constellation expanded, and increased marketing and international expansion expenses to support subscriber growth.

Space: Continued Investment in Starship

The Space segment's performance in 2025 was characterized by modest revenue growth and a shift to an operating loss, reflecting a strategic acceleration of investment in the next-generation Starship launch system.

• Revenue: Segment revenue grew 7.6% to $4.1B in 2025. The increase was primarily driven by $298M in higher Launch and Development revenue from government contracts, including an extended NASA contract for cargo resupply missions. Launch Services revenue from commercial customers remained relatively flat year-over-year, as a higher number of total Falcon launches were dedicated to internal Starlink deployments rather than third-party customers.
• Profitability: The segment reported an operating loss of $(657)M in 2025, a decline from operating income of $21M in 2024. This was almost entirely due to a $1.2B increase in R&D expenses to $3.0B in 2025, which the company attributes to an "accelerated investment in development of the Starship vehicle and continued development of production and launch facilities."
• Cost Efficiency: Cost of revenue decreased by $189M, or 12.2%, in 2025. This was driven by lower depreciation costs resulting from the increased reusability of Falcon launch vehicles and a higher allocation of launch costs being capitalized to the Connectivity segment due to the increased pace of Starlink deployments.

AI: Aggressive Investment in Compute Infrastructure

The AI segment, which includes the Grok AI model and the X platform, is in a phase of heavy investment to build out its computational infrastructure.

• Revenue: Revenue for the segment grew 22.2% to $3.2B in 2025. This was driven by a $465M increase in AI solutions and infrastructure revenue, from Grok and X subscriptions and data licensing, along with a $116M increase in advertising revenue on the X platform.
• Operating Loss: The segment's operating loss expanded to $(6.4)B in 2025 from $(1.6)B in 2024. This was driven by a massive increase in spending to support the development and scaling of its AI capabilities.
• R&D Investment: R&D expenses increased by $3.9B to $5.1B in 2025. The company states this was driven by higher GPU depreciation expense of $1.7B, increased infrastructure and cloud computing expenses of $1.4B associated with data center build-outs, and higher employee compensation of $775M.
• Other Costs: SG&A expenses also increased by $722M in 2025 due to higher employee compensation and legal expenses as the business expanded.

Capital Expenditures and Financing

SpaceX significantly increased its capital spending in 2025 to fund its growth initiatives across all segments.

• Capital Expenditures: Total capital expenditures were $20.7B in 2025, an 85.8% increase from $11.2B in 2024.
  • AI: The AI segment was the largest area of investment, with capital expenditures of $12.7B in 2025, up from $5.6B in 2024. This was for the "rapid expansion of our terrestrial data centers, including the development, construction, and equipping of new facilities and supporting infrastructure."
  • Connectivity: Capital expenditures were $4.2B in 2025, primarily for satellite and ground equipment costs to expand the Starlink network.
  • Space: Capital expenditures were $3.8B in 2025, mainly for "increased investment in our launch site infrastructure for Starship."
• Financing: The company funded these investments through significant external financing. Net cash from financing activities was $26.4B in 2025. This included $16.1B in proceeds from debt and other financing arrangements for the AI segment and $18.8B in proceeds from the issuance of capital stock, offset by debt repayments.