SPCX Fell 24.5% in the Past Month: Is the Sell-Off an Opportunity?

SpaceX Growth Signals Remain Strong Beneath the Slide

Second-quarter 2026 revenues surged 91.9% year over year to $7.81 billion, beating the Zacks Consensus Estimate by 16.3%. The loss of 9 cents per share was 73.5% narrower than a year earlier and beat the consensus loss estimate of 26 cents.

Growth was broad. Connectivity remained the largest revenue contributor, AI grew the fastest and Space benefited from a more favorable customer launch mix. Consolidated operating loss narrowed to $143 million from $970 million.

Starlink Gives SPCX a Profitable Growth Engine

Starlink subscribers doubled year over year to 12 million, helping Connectivity revenues climb 65.8% to $4.29 billion. Operating income rose 79.4% to $1.66 billion, producing a 38.6% operating margin. Adjusted EBITDA reached $2.60 billion.

Consumer revenues increased 44.4% to $2.49 billion and Enterprise & Government revenues more than doubled to $1.81 billion. Connectivity remains the company’s only segment-level source of operating income, giving Starlink a distinct role within the portfolio.

AI Upside Comes With SPCX Spending Pressure

AI revenues jumped 247.5% to $2.56 billion, driven largely by new cloud-services agreements. Segment adjusted EBITDA swung to positive $1.15 billion from a $276 million loss a year earlier, but the segment still posted a $1.26 billion operating loss under generally accepted accounting principles (GAAP).

AI accounted for $15.83 billion of SpaceX’s $18.37 billion in second-quarter capital expenditures. Management expects total capital spending in each of the next two quarters to remain near the second-quarter level, keeping capital efficiency central to returns.

Starship Keeps SpaceX's Execution Risk Elevated

Two successful Starship V3 flights in the 90 days before the second-quarter call moved the program forward. Upcoming milestones include deploying V3 Starlink satellites to operational orbit and attempting catches of the vehicle stages, with some steps still subject to regulatory approval.

Starship is designed to quadruple payload capacity and reduce launch costs tenfold versus Falcon 9. Delays in reusability, regulatory clearance or flight cadence could slow launch, Connectivity and future AI deployment plans at the same time.

Valuation Could Limit SPCX's Rebound Case

SPCX trades at 335.4X enterprise value to EBITDA versus 7.2X for its industry, while its 11.8X price-to-book multiple compares with 1.7X for the industry. The wide gaps raise the importance of converting elevated investment into more consistent returns.

Rocket Lab Corporation RKLB provides launch services and space systems, making it relevant to SpaceX’s launch exposure. AST SpaceMobile, Inc. ASTS is building space-based cellular broadband, offering context for satellite connectivity. Neither captures SpaceX’s combined launch, broadband and AI mix, which limits clean peer comparisons.

SPCX Signals Favor Patience After the Pullback

After the pullback, SPCX still presents a balanced setup rather than a clear-cut bargain. Rapid growth remains evident, but valuation, capital intensity and execution are meaningful offsets.

SPCX currently carries a Zacks Rank #3 (Hold), a VGM Score of D, Value Score of F, Growth Score of C and Momentum Score of A. The favorable Momentum Score contrasts with weak value and combined VGM characteristics, while the Hold rank supports patience rather than treating the decline alone as a buying signal.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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