Elon Musk deems SpaceX-Tesla merger plausible but unlikely, demands 50% of shares

The merger discussion is expected to attract the most interest, especially from Tesla shareholders, although Musk's own qualifications suggest it remains a concept rather than a strategy, potentially limiting any sustained market reaction. Setting the bar at approval from half of all Tesla shares represents a substantial obstacle, leading shareholders to view the comment as a long-term concept rather than an immediate trigger. The commentary on computing power offers a clearer takeaway: a statement that older Nvidia H100 chips now command higher rental fees than when new indicates tightness in AI infrastructure supply, generally supportive of positive sentiment toward Nvidia, server manufacturers, and AI cloud businesses. Coming during the same session as Super Micro’s surprise upgrade, the remarks contribute to a series of robust signals for AI demand.

Musk introduced a possible SpaceX-Tesla combination while underscoring it may not materialise. However, his more definitive message was that AI compute remains so tight that even outdated chips are increasing in value.

Summary:

• SpaceX CEO Elon Musk stated during the company's earnings call that merging with Tesla would be beneficial but is very uncertain
• He mentioned that any combination would require shareholder approval, including the backing of 50% of all Tesla shares
• Musk expressed that the need for AI computation is likely to stay elevated
• He observed that older Nvidia H100 chips are currently leasing for more than when they were initially released
• He cautioned that a scarcity of computing power for superintelligence might continue for an extended time
• These points followed SpaceX's quarterly financial figures, in which AI revenue exceeded projections and constituted over half of all sales

Further details from SpaceX's earnings call included chief executive Elon Musk stating that a merger of SpaceX and Tesla would be favourable but is far from assured, while also conveying that the request for AI computing power reveals no slowing down.

Musk noted that any merger would need shareholder support, including consent from 50% of all Tesla stock. The reference to total shares outstanding, rather than just votes cast, establishes a considerably more demanding threshold. He provided no indication of a formal proposal, timeline, or ongoing negotiations. His statements are most appropriately regarded as an opinion on a potential structure rather than an active transaction.

On the subject of AI, Musk indicated that demand for compute is likely to remain elevated. He reported that older Nvidia H100 processors are now leasing for higher rates than when they were new, which he sees as a demonstration of how strained AI processing capacity has become. He also cautioned that a shortage of the computation required to create superintelligence could continue for an extended duration.

These remarks gave context to SpaceX's third-quarter results, released earlier in the event. Revenue of approximately $14.6 billion exceeded projections, with the AI segment accounting for roughly $7.6 billion, representing over half of the total. Capital spending of around $19.6 billion, mainly focused on AI, exceeded quarterly revenue, so Musk's perspective that compute will remain in limited supply helps clarify why the business sustains such a rate of investment.

The statements also appeared on the same day that Super Micro Computer issued a surprise early update indicating September-quarter revenue significantly surpassed its previous forecast, adding to the body of evidence that expenditure on AI infrastructure continues to be strong.

For the time being, the merger concept appears to be a distant scenario with considerable barriers, whereas the compute perspective has more instant significance for investors monitoring the AI hardware industry. Any subsequent elaboration from Musk or either organisation on the merger would represent the next point of interest.