SpaceX Q3 Results, Compute Buildout Strengthen AI Growth Case, Morgan Stanley Says

11:22 AM EDT, 10/21/2026 (MT Newswires) -- SpaceX (SPCX) reported a Q3 "big beat" and outlined an aggressive compute expansion plan, reinforcing Morgan Stanley's view that investors may be undervaluing the company's artificial intelligence business. Revenue of $14.6 billion and adjusted earnings before interest, taxes, depreciation, and amortization of $8.8 billion came in 14% and 29% above consensus, respectively, led by a $1.3 billion beat in AI revenue. AI revenue totaled $7.6 billion, above the $6.4 billion consensus estimate, the report said Wednesday. Morgan Stanley also highlighted what it called a "punchy outlook," including Q1 2027 revenue guidance of $33 billion to $37 billion and management's expectation for an incremental 10 gigawatts of compute capacity in 2027. The investment firm raised its fiscal 2026 and 2027 revenue forecasts to $51 billion and $178 billion, respectively, from $48 billion and $113 billion, driven largely by higher AI revenue expectations. It said investors still value SpaceX like a "standard neocloud" rather than a "vertically integrated, full-stack AI player." Morgan Stanley has an overweight rating on SpaceX with a price target of $300. Shares of SpaceX were up more than 9% in late Wednesday morning trading. Price: 161.19, Change: +13.40, Percent Change: +9.06