Phillip Securities Reiterates Sell on SpaceX, $75 PT

Phillip Securities analyst Glenn Thum reiterated a Sell rating and $75 price target on SpaceX (NASDAQ: SPCX).

“2Q26 revenue of US$7.8bn rose 92% YoY, with 1H26 revenue at 43% of our FY26e forecast.

Growth came from: 1) AI revenue up 247% YoY, of which US$1.6bn was the initial ramp on Cloud Services Agreements signed in the quarter; 2) Connectivity up 66% YoY as Starlink subscribers doubled to 12.0mn and enterprise and government revenue rose 108%; and 3) Space up 29% YoY on more large customer launches.

It ended 2Q26 with US$100bn of cash and securities after raising US$85.7bn net at IPO and US$25bn of bonds. Connectivity produced the margin, with segment operating income up 79% YoY, ahead of revenue.

ARPU fell 22% YoY to US$66 as growth moved to lower-priced markets. Management guided capex in the next two quarters at roughly 2Q26’s US$18.4bn, compute capacity above 2 GW by December (prev.

1.4 GW in June), and a US$100bn annualised revenue run rate by December including Cursor, which has not closed. Maintain SELL with an unchanged target price of US$75.00.

We keep our FY26e estimates unchanged. Our valuation is based on a DCF valuation using a 10.0% WACC and 3.5% terminal growth rate.

We remain cautious as the revenue that turned AI profitable is the least durable. Cloud services charge monthly fees and either party can terminate on 90 days’ notice after the initial ramp.

Furthermore, one AI customer accounted for 19.5% of 2Q26 group revenue, up from under 10% a year ago; Space lost US$542mn at the operating line; and capex was 2.4x revenue.

A re-rating requires these compute contracts to be converted into multi-year commitments”

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