Shares of SpaceX and Tesla soared Wednesday after Elon Musk’s rocket firm reported blowout revenue and a possible merger with his EV maker – sending other tech stocks and the Nasdaq higher.

The rocket and satellite firm was up 10% Wednesday morning after reporting third-quarter revenue of $14.6 billion – up a whopping 161% from the previous year. That included roughly $7.6 billion from its AI division – now called SI, a nod to President Trump’s preferred term “super intelligence” – and marked a drastic shift for the company, which was previously leaning on revenue from its Starlink satellite business. 

Meanwhile, Musk – the world’s richest person – said during an earnings call Tuesday that he is weighing a historic merger with Tesla and that the boards of both companies have created committees to discuss a tie-up. 

“I do think there’s a lot of merit to combining the companies as we are pretty much in the superintelligence singularity, and there’s a lot to be gained from cooperating,” the near-trillionaire business mogul said.

Shares of Tesla, which is set to report third-quarter earnings after the closing bell Wednesday, jumped 3.3% Wednesday morning. 

Dan Ives, partner at Yorkville Ives & Co, estimated there is an 80% to 90% chance that Tesla and SpaceX merge by the end of 2027 “for a number of strategic AI and data-driven reasons.” 

The Nasdaq rose 0.4% Wednesday, while space stocks like RocketLab, Intuitive Machines and AST SpaceMobile jumped 4.1%, 6.4% and 1.1%, respectively.

SpaceX’s upbeat earnings came four months after its record-breaking IPO in June, which valued the company at roughly $1.75 trillion and raised more than $85 billion in net proceeds. It is now worth more than $2 trillion. 

A tie-up between SpaceX and Tesla could easily become the largest merger in history, as the automaker boasts its own $1.5 trillion market cap – despite struggling to sell its electric cars in markets worldwide.

But Tesla got investors buzzing last week with the reveal of a futuristic “flying” car. In stunning video footage, the Tesla Roadster could be seen zooming to the top of a vertically curved track before launching into the air, flipping midway and landing on the ground using jet propulsion.

Musk has steadily been combining his ventures over the years. In February, SpaceX acquired his xAI business, becoming SpaceXAI and taking over the Grok chatbot, social-media platform X and cloud-leasing business. Much of the company’s revenue is now coming from its ability to rent out AI computing power.

Last year, SpaceX bought about $100 million worth of Tesla Cybertrucks – another sign that Musk is looking for ways to take advantage of the close links between the companies.

“We delivered another strong quarter in Q3. Revenue grew an impressive 161% year-over-year, fueled by continued momentum in Connectivity and a clear inflection in our Super Intelligence business,” SpaceX Chief Financial Officer Bret Johnson said Tuesday.

The company also reported operating income of $2.8 billion and net income of $4.4 billion – much improved from a net loss of $1.05 billion in the same period last year.

SpaceX is forecasting first-quarter revenue in 2027 of $33 billion to $37 billion, above analysts’ expectations of $22.2 billion.