SpaceX's 2025 profit hits $8B, boosting IPO prospects
What's the story
Elon Musk's space exploration company, SpaceX, made a whopping $8 billion in profit on revenues of $15-16 billion last year, according to Reuters. This gives us a new perspective on the fiscal health of Musk's venture. The numbers have led some banks to believe that SpaceX could raise over $50 billion at a valuation exceeding $1.5 trillion through its upcoming IPO later this year.
Revenue sources
Starlink drives revenue surge
The reported profit figure is before interest, taxes, depreciation and amortization (EBITDA), a key indicator of operational performance. The bulk of SpaceX's revenue comes from Musk's satellite-based internet service, Starlink. According to the sources, it accounts for 50% to 80% of the company's total revenue. Since its launch in 2019, Starlink has grown rapidly with over nine million users globally.
Growth strategy
Strategic acquisitions bolster growth
SpaceX has also made strategic acquisitions to support its growth. Last year, the company bought $19 billion worth of wireless spectrum rights from EchoStar. The acquisition is part of SpaceX's plan to expand Starlink into the direct-to-device market, allowing mobile phones to connect directly with Starlink satellites without a user terminal. This move comes as SpaceX prepares for what could be the world's largest IPO around Musk's 55th birthday on June 28.
Information
SpaceX's ambitious plans for Starship
Musk hopes to use Starship, which has been test-launched 11 times since 2023, for space payload launches this year. The billionaire also plans to launch space-based AI data centers using Starship. This ambitious project is tied to SpaceX's proposed merger with Musk's artificial intelligence company, xAI.