SpaceX's first quarterly earnings report as a public company reveals that the rocket business is now a minor part of its revenue, with AI-related data centre leasing and satellite internet dominating the balance sheet. The space segment brought in just over 10% of revenue and didn't reach $1 billion for the quarter, while SpaceX itself remains its own biggest rocket customer, raising questions about demand for its core launch business. This matters because it recasts a company synonymous with spaceflight as primarily a telecoms and cloud-computing operator riding the AI boom.

Starlink, SpaceX's satellite internet arm, generated $4.2 billion in revenue and was the only division to turn an operating profit, while the "neocloud" business of leasing data centre compute to AI firms outspent both the space and connectivity segments combined, with $15.8 billion spent on AI in the second quarter alone. That business began as infrastructure for Musk's Grok AI, built at the Colossus 1 facility in Memphis, but after xAI struggled with latency and mismatched chip generations, only about 10% of the compute now goes to Grok, with the rest leased to clients including Google, Anthropic, Reflection AI and Cursor. Analysts expect neocloud spending to rise further, to around $65 billion next year, underscoring how central AI infrastructure has become to SpaceX's finances even as its profitability remains uncertain.