Elon Musk has expressed support for a possible merger between SpaceX and Tesla, saying the companies could benefit from closer cooperation in artificial intelligence, robotics, chip design and space-based computing.

The comments came as SpaceX reported its first quarterly profit since going public, recording net income of $4.4 billion for the July to September period, compared with a loss of $1.1 billion a year earlier. Revenue jumped 161% to $14.6 billion, driven largely by growing demand for artificial intelligence computing services.

Speaking to analysts on Tuesday, Musk described a merger as “a good idea” but cautioned that discussions remained preliminary and there was no guarantee an agreement would be reached. SpaceX shares rose nearly 5% in after-hours trading following his remarks.

Independent director committees at both companies have been established to examine the proposal at shareholders’ request. Musk said he would not participate in their discussions because of his potential conflict of interest, given his leadership roles and significant ownership stakes in both businesses.

Musk is chief executive of Tesla and serves as chief executive, chairman and chief technology officer of SpaceX. A regulatory filing showed he owned 48.4% of SpaceX as of June 30 and controlled more than 82% of its voting power. He holds about 20% of Tesla.

Any merger would require approval from a majority of all Tesla shares, rather than only those participating in a vote, which Musk described as a high hurdle. The committees have yet to agree on terms.

SpaceX began trading on the Nasdaq on June 12 following an initial public offering priced at $135 a share that raised approximately $85.7 billion. Its first earnings report as a listed company showed second-quarter revenue of $7.8 billion and a net loss of $541 million.

The turnaround in the latest quarter was led by its artificial intelligence division, now called “Super Intelligence”. Revenue from the unit increased more than ninefold year on year to $7.6 billion, making it SpaceX’s largest source of sales and overtaking its Starlink satellite internet business.

The company attributed the growth to cloud computing agreements, wider use of its Grok chatbot and its acquisition of artificial intelligence coding start-up Cursor.

SpaceX’s cloud customers include Anthropic, which agreed in May to pay nearly $45 billion over three years for computing capacity at its Colossus data centres. Google also signed an agreement in June to pay $920 million a month from October through June 2029.

Despite the strong revenue growth, spending remains substantial. SpaceX invested $19.6 billion during the quarter, including $16.4 billion in artificial intelligence infrastructure. Capital expenditure for the first nine months of the year reached $48 billion.

The company’s computing capacity rose to 1.7 gigawatts from 0.6 gigawatts a year earlier. Musk said he was confident SpaceX could bring an additional 10 gigawatts online in 2027, although power supply, cooling systems and electrical equipment remained constraints.

Starlink revenue rose 69% to $5.2 billion, with consumer subscribers reaching 13.6 million. However, average monthly revenue per consumer fell to $69 from $83 a year earlier.

SpaceX also completed the first revenue-generating flight of its Starship rocket, carrying 26 next-generation Starlink satellites into orbit. The vehicle is central to Musk’s plans for expanding satellite deployment and eventually reaching Mars.

Netflix shares fell more than 5% on Tuesday after its latest earnings report failed to ease investor concerns about slowing audience engagement, intensifying competition and the outlook for revenue growth. The streaming company is also reportedly planning to cut around 1,000 jobs, equivalent to about 6% of its workforce.

The California-based company reported revenue of $12.87 billion for the third quarter ended in September, alongside net income of $3.7 billion. Both figures exceeded investor expectations, according to FactSet, but the results did little to reassure shareholders about the company’s longer-term growth prospects.

Netflix acknowledged concerns about the amount of time subscribers spend watching its content, a key measure of audience engagement. In a letter to investors, the company said it was confident it could accelerate growth in viewing hours.

The company did not disclose total viewing hours for the latest quarter. It reported that viewing time in India rose 24% from the same period a year earlier. In July, Netflix said subscribers had watched 97 billion hours of content during the first half of the year, up 2% from the first six months of 2025. It stopped reporting subscriber numbers in early 2025.

John Belton, a portfolio manager at Gabelli Funds, told AFP that Netflix had underperformed significantly over the previous six to 12 months. He cited concerns about weaker engagement, slower revenue growth, a less favourable outlook for profit margins and recent changes in content leadership.

Co-chief executive Ted Sarandos acknowledged that the company needed to improve its performance in the United States, even as its business continued to expand across Latin America, Europe and Asia.

“Our content around the world is largely working,” Sarandos told analysts, while noting that the US business was not growing as quickly as the company wanted.

Netflix is also facing reported workforce reductions and changes among its senior content executives. The Hollywood Reporter reported that seven senior employees involved in television deals and content were among those affected by recent changes.

The company has appointed former Disney executive Peter Rice as its new content chief, replacing Bela Bajaria, who oversaw major productions including Stranger Things, Bridgerton and Squid Game. Sarandos said Rice’s experience managing relationships with creative talent would be important in a competitive entertainment market.

To attract and retain viewers, Netflix has expanded beyond films and television series into live sports, gaming and shorter-form content. Its live programming includes agreements involving the NFL and WWE, while the company has also pursued major sporting events.

However, competition remains intense. Nielsen data showed Netflix accounted for 7.8% of US television streaming viewership in July, compared with 14.2% for YouTube.

Netflix also acknowledged that advertising revenue growth was running behind its ambitious target for the year. Co-chief executive Greg Peters said the advertising business was still expanding and that new advertising formats could support future growth.

Despite the challenges, Sarandos said most company spending and nearly all revenue remained focused on films and television, which he described as offering substantial room for future growth.

Oil prices remained near a five-month high on Tuesday as uncertainty over energy supplies during the war with Iran kept markets on edge, while concerns about inflation and artificial intelligence spending weighed on global equities.

Brent crude futures traded at around $110 a barrel ahead of the European market opening, while US West Texas Intermediate crude for next-month delivery remained above $104.

Traders continued to assess the risk of further Iranian attacks in the Strait of Hormuz, a vital route for global energy shipments, even as crude flows from the Persian Gulf showed signs of recovery.

ING commodities strategists said elevated prices despite relatively strong oil flows indicated that markets were maintaining a substantial risk premium because of uncertainty surrounding the conflict. They added that record tanker freight rates were increasing delivery costs.

The United States is considering allowing the sale of sanctioned tankers to return additional vessels to the legitimate shipping market. However, analysts said it remained unclear how much extra capacity the move could provide or how quickly it might reduce transport costs.

US Energy Secretary Chris Wright told Fox News that crude flows from the Gulf had recovered to about 80 per cent of pre-war levels, although supplies of refined petroleum products remained more constrained.

Gas markets also faced pressure. Asian spot liquefied natural gas prices rose to $30.40 per million British thermal units on Monday, their highest level since December 2022, according to Bloomberg. Concerns intensified after UK Maritime Trade Operations reported that an LNG tanker had come under fire from a small boat off Yemen on Saturday.

European gas prices remained elevated, with Dutch TTF futures for next-month delivery trading just below €88 per megawatt-hour on Tuesday morning.

European shares fall as investors assess risks

European stock markets opened lower after losses on Monday, when French equities and bonds came under pressure amid protests and concerns about the country’s public finances.

The FTSE 100 in London and France’s CAC 40 each fell 0.2 per cent at the opening, while Germany’s DAX declined more than 0.4 per cent.

British markets received some support from reports that Chancellor John Healey would not raise capital gains tax in next week’s Budget. Stronger-than-expected labour market figures also offered reassurance, with unemployment falling to 4.7 per cent in the three months to August from 4.9 per cent. The number of employees on company payrolls increased by 13,000, the largest rise in a year.

Across Asia, technology stocks led declines as investors questioned whether heavy spending on artificial intelligence would generate sufficient returns. Tokyo’s Nikkei 225 fell 1.3 per cent, Hong Kong’s benchmark lost 1.1 per cent and South Korea’s Kospi dropped more than 3.7 per cent.

AI infrastructure company Elice fell as much as 33 per cent on its Kosdaq debut, reflecting concerns about borrowing costs, competition and future profitability.

The declines came despite gains on Wall Street, where Amazon, Microsoft and Nvidia helped lift the Nasdaq. Investors are now watching earnings from SpaceX, Meta and Tesla for clues about technology companies’ financial performance and AI investment plans.

Gold slipped to around $4,152.80 an ounce, while the euro traded at $1.1225 against the US dollar. The dollar was little changed at 158.45 yen.