A potential merger between Tesla and SpaceX has sparked debate among Wall Street analysts, with The Wall Street Journal reporting that a loophole in Musk's $1 trillion pay package could allow him to unlock huge equity payouts if Tesla acquires or merges with SpaceX. SpaceX's Q2 2026 revenue surged 92% year-over-year to $7.8 billion, with adjusted EBITDA up 191% to $3.5 billion, while Tesla's operating income plummeted 57% to $398 million, crushing operating margins to 1.4% and turning free cash flow negative at -$1.09 billion. Hedge fund data shows institutional participation in SpaceX remains concentrated among specialized investors, while Tesla hedge fund holdings declined from 137 funds in Q4 2025 to 123 funds in Q1 2026. Investors should watch whether Tesla can stabilize margins and restore positive free cash flow, and track board proxy disclosures for any structural moves toward a combined entity.
Tesla IncTesla's operating income plummeted 57%, margins crushed to 1.4%, and free cash flow turned negative.
Space Exploration Technologies Corp. Class A Common StockSpaceX revenue surged 92% YoY to $7.8B, indicating strong demand for launch services.
