Two of the biggest names in technology may be about to become one. On Tuesday night, during SpaceX's third-quarter earnings call, Elon Musk confirmed that SpaceX and Tesla have each set up special committees of independent directors to look at a possible merger. Press reports put the combined value at roughly $3.5 trillion.
What Musk actually said
It is worth being careful here, because this is a long way from a deal. Musk said the committees were created at shareholders' request and that he is kept out of the discussions because he runs both companies. He called it "an odd kabuki dance" in which two groups talk and he cannot join in. The committees, he said, have not agreed any terms, and there is no guarantee they will.
He did say he personally thinks a combination is a good idea. He also pointed to a high bar on the Tesla side: approval would need a majority of all outstanding shares, not just a majority of those voted. Tesla's annual meeting is on 3 December, and no merger proposal is currently on its agenda.
Why AI and robots are the pitch
Musk's case rests on overlap. He named AI software, chip design, the Terafab semiconductor plant the two firms are building together, robotics, and the Starlink satellite network as areas where the companies could pool effort. For readers of this site, the robotics part is the interesting one: Tesla's Optimus humanoid and its Cybercab robotaxi would sit alongside SpaceX's growing AI business under one roof. Musk has said recently that Optimus and Cybercab will be the vast majority of Tesla's value.
SpaceX's AI business is now the headline
The timing is no accident. SpaceX reported third-quarter revenue of $14.58 billion and its first quarterly profit since listing, with AI revenue of about $7.56 billion, which overtook its Starlink connectivity business for the first time. It reported a $63 billion backlog and expects to spend $35 billion to $40 billion on capital projects in the fourth quarter. Shares in SpaceX rose around 8% after hours, and Tesla's about 2%.
What happens next
Tesla reports its own third-quarter results after the US close today, and investors will be listening for any further comment on the merger, plus updates on Optimus production and Cybercab. Analysts quoted in the press are split on timing: Barclays has suggested an announcement could come around the December meeting or within six to twelve months, while others think it could be years away.
For now, treat it as a signal rather than a certainty. If the two companies do combine, it would create one of the largest businesses in the world, with a stake in rockets, satellites, chips, AI models, cars and humanoid robots. We will update this story if a firm proposal emerges.