Musk says committees formed to explore SpaceX-Tesla merger

Elon Musk stated that committees have been established to explore a potential merger between SpaceX and Tesla, a disclosure that lifted shares of both companies in extended hours trading. Speaking on an investor call following SpaceX's second quarterly earnings report since its initial public offering, Musk clarified that the committees have not yet reached an agreement on the terms of any transaction.

The world's largest commercial rocket launcher and satellite operator would join forces with the second-biggest electric car manufacturer if the deal proceeds. Musk, who serves as CEO of both firms but is not on either committee, emphasized that there is no guarantee a deal will be reached, though he believes there is significant merit to the tie-up. In the third quarter, SpaceX reported revenue of $14.6 billion, a surge of more than 160% from the prior year and above analyst estimates, with profit standing at $4.4 billion. Capital expenditures for the rocket maker climbed to $19.6 billion during the period. Tesla is scheduled to report its earnings after the closing bell on Wednesday.

U.S. stock futures pointed mostly higher on Wednesday as investors assessed corporate results and ongoing uncertainty in the artificial intelligence sector. By 03:01 ET, S&P 500 futures had risen 0.2%, Nasdaq 100 futures climbed 0.5%, and Dow futures remained broadly unchanged. The previous session ended in mixed fashion, with the S&P 500 and Dow posting gains while the tech-heavy Nasdaq closed slightly lower. Analysts at Deutsche Bank noted that relief from energy prices helped equities rally as investors overcame earlier jitters regarding AI infrastructure spending and elevated borrowing costs.

Oil prices fluctuated during the early session following unconfirmed reports that Qatar and Pakistan proposed reviving talks to conclude the Iran conflict. Brent crude briefly dipped to $106 a barrel from $112 before rising again after reports indicated Iran's president believes the United States will attack again if negotiations occur. Brent was last trading around $110 a barrel. Semiconductor stocks, a tracker of which fell 0.29%, were relative underperformers, though the index pared back much of its initial losses. Neocloud CoreWeave, a figurehead in recent AI concerns, also bounced.

In related developments, media reports citing new disclosures indicated that Anthropic generated $16.3 billion in revenue for the first six months of the year ahead of a potential IPO that could value the company at $2 trillion. One-fifth of that revenue came from just two clients. The San Francisco-based firm recorded a net loss of over $80 billion, up from a loss of $13 billion a year earlier, largely due to an accounting adjustment. Anthropic flagged risks regarding its ability to secure massive computing capacity and protect against liabilities such as AI cyberattacks.

Meta Platforms is due to unveil earnings after the closing bell, marking it as the first of the AI hyperscalers to report quarterly results. The company recently released its Muse AI model, which amassed millions of downloads since its September launch, and subsequently released an open-weight version of its Muse Spark model for coding. Elsewhere, The Information reported that Nvidia is discussing an investment of hundreds of millions of dollars in Australian AI cloud company Firmus Grid after the firm scrapped its IPO plans earlier this month.