Trillion-dollar merger pricing: Market focuses on SpaceX financial reports, betting on confidence in a merger with Tesla.

October 19 — SpaceX is set to release its third-quarter earnings after the bell on Tuesday, with the market closely watching its revenue performance and capital expenditures to assess the company's valuation and the feasibility of a potential merger with Tesla. Barclays analysts expect that if the two companies merge, the deal could take the form of an all-stock swap, with the higher-valued SpaceX as the surviving entity.

Barclays' reference valuations are $2.1 trillion for SpaceX and $1.5 trillion for Tesla, respectively. Based on this calculation, Tesla shareholders could receive approximately 0.7 shares of SpaceX per share. Analysts believe that if SpaceX's revenue growth is strong and capital expenditures remain manageable, it would help boost market confidence in the merger plan; conversely, if massive AI infrastructure spending continues to weigh on cash flow, the market may reassess its valuation and the reasonableness of the transaction.

The market expects SpaceX's revenue for this quarter to be approximately $12.89 billion, but capital expenditures could reach as high as $19.6 billion, with free cash flow potentially at negative $11.6 billion. It should be noted that the two companies have not officially announced a merger, and the above transaction structure and share exchange ratio are both analyst projections.