SpaceX shares under pressure despite revenue beat

Space Exploration Technologies Corp (NASDAQ: SPCX) shares fell more than 8% overnight, even after the company beat revenue expectations in its first financial report since listing as a public company.

Major revenue surge

The company, helmed by Elon Musk, reported second-quarter revenue of US$7.8 billion, better than the US$6.8 billion Bloomberg was reporting as the consensus expectation, and up from US$4.1 billion in the same quarter last year.

SpaceX's net loss came in at US$541 million, down from a US$1 billion loss for the same quarter last year.

And while the stock jumped more than 9% during normal trading hours, it fell back in after-hours trading to be changing hands for US$116.22, down 7.3%.

This is well below the US$135 initial public offer price for the stock as well as the high of US$225.64 it hit in the days following its listing on the Nasdaq exchange.

SpaceX said in its financial statements that its revenue for the quarter had increased by 91.9% compared to the same quarter last year.

The company added:

This increase was due to an increase in revenue from our AI segment of US$1,824 million primarily from new AI infrastructure contracts, an increase in revenue from our Connectivity segment of US$1,703 million as our Starlink consumer subscribers and enterprise and government customer base continued to grow, as well as an increase in revenue from our Space segment of US$216 million primarily driven by customer mix and an additional customer launch.

The company's cost of revenue increased by 53.2% to US$1.213 billion.

The company added:

This increase was due to an increase in costs in our Connectivity segment of $659 million driven primarily by an increase in depreciation related to the number of satellites placed into orbit and an increase in Starlink Kit production spend as our Connectivity revenue grew, and a $555 million increase in costs in our AI segment primarily due to an increase in infrastructure costs allocated to cost of revenue due to new AI infrastructure revenue contracts.

Average revenue per user for the company's Starlink division fell from $US85 last year to US$66.

Mr Musk reportedly told an investor call overnight that it was "another milestone year" and the company was "solving some of the hardest engineering problems in the history of humanity''.

Further downside on the way?

The SpaceX share price could come under further pressure in the next couple of days as shares are released from a lock up period and are able to be traded for the first time.

Broker UBS has a price target of US$210 on SpaceX shares.

The post SpaceX shares under pressure despite revenue beat appeared first on The Motley Fool Australia.

Motley Fool contributor Cameron England has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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