Letter From The Editor
If you haven’t already, check out the YouTube video I linked to below You'll NEVER Get Me To Say “Super Intelligence” Instead Of “Artificial Intelligence” because I get pretty spicy! And while you’re watching it do me a solid to click the Like button so I know you watched it, and Subscribe to my channel so I can keep making these videos for you. Now onto this week’s newsletter, which is the 266th weekly newsletter I’ve published in the last 5 years without every missing a week!

In today’s newsletter I discuss the economics behind a merger between Elon Musk’s SpaceX and Tesla, Anthropic just announced that they plan to transfer 5% of their shares into a new public benefit fund, The U.S. Treasury Department just reported that the nation’s budget deficit just reached $2 trillion dollars for 2026, Disney’s ESPN has teamed up with Disney’s Star Wars to broadcast a fully animated telecast of this year’s Super Bowl LXI, Porsche just unveiled that new Mission S concept car, Kimi Antonelli is on track to win the Formula One World Drivers Championship, and I just saw the trailer for Idris Elba’s new SyFy movie ‘Above the Below”, and I’m pretty sure I’m going to go and see it in an actual theater

Let’s get into it!

Some pretty smart sounding people have been predicting lately that Elon Musk might decide to merge his recently IPOed SpaceX with his other trillion dollar company Tesla to create a single massive company that does everything from build lithium batteries, making solar panels, launching rockets into space, creating AI data centers on both Earth and in space, building cars that fly and can drive themselves, blanketing the skies with enough satellites to provide world-wide internet and mobile phone service, and creating a self-sustaining permanent civilization on Mars to make the human species a multi-planet civilization all in order to ensure the long-term survival of humanity. That’s a lot for a single company to do, and even more ambitious for them to strive to achieve. So I thought we could look at the economics behind a SpaceX and Tesla merger, and see what a combined company might look like. Let’s get into it.

What could a merger between SpaceX and Tesla look like? That’s what I asked myself when I sat down to write this article. Elon Musk runs both of these massive companies that together have made him the world’s first trillionaire. He’s also the largest shareholder in each company, which has empowered him to call all the shots for SpaceX’s trajectory and map out Tesla’s direction. Many brilliant and powerful business people before Elon Musk have set out to combine multiple companies into a single conglomerate, but this time feels different. Beyond the low hanging fruit of any potential merger, like talk of synergies and efficiencies that could save billions of dollars, there’s the potential that a combined SpaceX and Tesla could streamline innovation and fuel an even more powerful tech company, regardless of whether that’s a good thing or not.

A combined SpaceX and Tesla could, on paper, have a market valuation of around $3.49 trillion dollars, based on SpaceX’s current market cap of $2.01 trillion dollars and Tesla’s market cap of $1.48 trillion dollars. Revenue projections by analysts for SpaceX in 2026 are $45.3 billion dollars with no profitability based on the company’s massive spending on AI data centers and space launch activities. SpaceX’s Starlink and connectivity segment is expected to turn a profit of around $6.5 billion dollars. Revenue projections by analysts for Tesla in 2026 are $107.1 billion dollars, with a profit estimate of around $19.7 billion dollars. So at least on paper, a combined SpaceX and Tesla could bring in as much as $152.4 billion dollars a year, and generate a profit of $19.7 billion dollars.

Now that we’ve explored what a combined SpaceX and Tesla could look like from a revenue and profitability perspective, let’s take a look at what their combined products and services might look like.

Today SpaceX’s business can be broken down into three segments, including the manufacturing and launching of rockets into space, their global Starlink and Starshield communication networks, and their land-based and future space-based AI data center satellites. On the manufacturing and launch side of SpaceX’s business they have their core Falcon 9 and Falcon Heavy rockets, which they use to launch commercial payloads into space. Before the end of 2026 SpaceX plans to begin commercial launches of their new Super Heavy and Starship, with the first payloads being Gen 3 Starlink satellites. SpaceX also has commercial contracts with NASA to launch both their Cargo Dragon and Crew Dragon to the ISS. On the commercial satellite communications side of SpaceX’s business they launch their Starlink satellites as a part of their estimated $18.7 billion dollar a year Starlink internet services that provide connectivity across approximately 160 countries and territories around the world. SpaceX also developed Starshield for the U.S. Department of Defense (because I’ll never refer to them as the Department of War no matter how much you pay me!). Starshield is a military-grade satellite communications network that SpaceX designed, developed, and launched for the U.S. military and our allies, like Ukraine regardless of what some politicians write on their social networks. Today Starshield is operated by the U.S. military, and SpaceX is not responsible for who does or doesn’t have access to it on a daily basis. Then we have SpaceX’s AI business in the form of their Earth-based AI data centers and future space-based AI satellites, which comes from SpaceXAI, which itself was formed after Elon Musk’s X (formerly Twitter) merged with his company XAI to form SpaceXAI. Elon Musk just recently said he’s renaming SpaceXAI to SpaceSI, which I’m on record saying I think is a horrible name and a branding mistake, but no one asked me so I guess it doesn’t matter that much.

Then we have Elon Musk’s first love, Tesla, whose products and services can be segmented into vehicles, energy, and robotics. Tesla designs and manufactures their own electric vehicles including the Model S, Model Y, Model 3, and Model X, as well as the Cybertruck, the Tesla Semi, the Cybercab, the Tesla Robovan, and the newly unveiled Tesla Roadster which can literally fly. You can’t even make these things up! And you can’t have a Tesla vehicle without taking advantage of the company’s Tesla Insurance, which is a digital, telematics-based auto insurance product built exclusively for Tesla vehicle owners. Believe it or not, Tesla is also a SaaS company, with their software subscriptions for Autopilot and Full Self Driving. And we can’t forget Tesla’s Supercharger DC fast-charging EV network, which is the largest EV charging network in the world. Tesla also designs and manufactures their own lithium batteries for their Powerwall home energy storage system and their utility-scale Megapacks. Not content to just store energy, Tesla also makes their own traditional solar panels, as well as the quaint Solar Roof, which is rumored to be discontinued pretty soon. Then we have to talk about the future of Tesla, which according to Elon Musk, will include the launch of Tesla’s humanoid Optimus robots that are scheduled to launch by the end of 2027, but with all things Elon Musk timing is more of an art than a science.

Combining all of SpaceX and Tesla’s products and services into one company would span a lineup ranging from various electric vehicles and subscriptions to their services, energy generation and storage, DC fast-charging EV stations around the world, Optimus humanoid robots, rockets including Falcon, Falcon Heavy, Super Heavy, and Starship, Dragon Cargo and Dragon Crew spaceships, Starlink and Starshield satellite communication networks, the impending launch of the Starlink Mobile phone service, and SpaceXAI, or SpaceXSI, or whatever they’re calling themselves today, which consists of both Earth-based AI data centers and future space-based AI satellites. That’s a lot of products and services for one company to offer, and the potential for new innovations shouldn’t be underestimated. With a potential market cap of around $3.49 trillion dollars, a combined SpaceX and Tesla would instantly become one of the world’s most valuable companies in the world providing vehicles, AI data centers, spaceships, solar energy production and storage, and space-based satellite and terrestrial communications, but is that a good thing? The jury is still out on that, but no one shouldn’t sleep on Elon Musk’s vision for technology, or the potential for creating generational wealth that could come from owning SpaceX and Tesla shares.

Elon Musk just said out loud what every shareholder has been hoping for - SpaceX and Tesla’s boards have each formed a committee to explore a merger.

Since Elon Musk is the largest shareholder in both SpaceX and Tesla, and he’s stacked their boards with his loyalists, then if he wants the companies to merge then that’s exactly what they’ll vote to do. At SpaceX, Elon Musk owns roughly 45% of the company and holds around 84% of the total voting power, while over at Tesla, he owns roughly 20% of the equity and holds about 20% of the voting power.

Like I said, if Elon Musk deems it to be so then SpaceX and Tesla’s merger is already a foregone conclusion, and as a long-term shareholder in both companies I’m all for it.

I just saw the trailer for Idris Elba’s new SyFy movie ‘Above the Below”, and I’m pretty sure I’m going to go and see it in an actual theater - it looks THAT good!

The movie’s about 3 astronauts who survive a catastrophic atmospheric reentry after an accident in space, only for their sink to the crushing bottom of the ocean. As my dad used to say, out of the fire and into the frying pan.

Anthropic just announced that they plan to transfer 5% of their shares into a new public benefit fund, with the option for their board of directors to add another 2% of shares for every 50% increase in the company’s valuation above some undisclosed baseline number. That’s all well and good, and obviously I have questions, but you’d have to be a math wiz to figure out how many shares that would be and what they’d be worth. Also, who decides what these shares will be used toward in the public benefit fund? I guess we’ll get some more answers when Anthropic IPOs later this year at a nearly $2 trillion dollar valuation.

The U.S. Treasury Department just reported that the nation’s budget deficit just reached $2 trillion dollars for 2026. That’s a 12% increase over 2025, and marks the 3rd largest annual deficit in U.S. history of budget deficits, which isn’t a good look for the U.S. economy if you ask me. Today the nation’s debt is roughly $40.39 trillion, give or take a few billion here or there.

Disney’s ESPN has teamed up with Disney’s Star Wars to broadcast a fully animated telecast of this year’s Super Bowl LXI to be broadcast live on Disney+, Disney Channel and Disney XD. Sony is providing the optical tracking data that’ll transform the live player movements into digital avatars on the field. And no Star Wars tie-in would be complete with C3PO, who’s making an appearance thanks to Anthony Daniels who’s returning to provide the voice of C3PO during the game. No word yet on if appear Yoda will.

Porsche just unveiled that new Mission S concept car, and it’s a beast! The mid engine supercar will feature a hybrid system that pairs a twin turbo flat 6 engine with an electric motor that is expected to deliver well over 1,000 horsepower. It’s estimated the production model will sell for over $500,000 dollars, and there’s already a waiting list.

In Formula One right now Kimi Antonelli is on track to win the Formula One World Drivers Championship, and he could do it as early as this week at the United States Grand Prix in Austin, Texas at the Circuit of the Americas (COTA). Kimi Antonelli has 340 points, and is 102 points ahead of his Mercedes teammate George Russell now has 238 points. If Kimi Antonelli wins the race and gets those 25 points then he’ll win the 2026 Formula One World Drivers Championship, even though there will still be another 5 races to go before the end of the season. That’s how massive of a lead Kimi Antonelli has over the rest of the Formula One field of drivers. Pretty impressive when you consider this is only Kimi Antonelli’s 2nd year in Formula One, and some drivers go their entire career without a single win. Like I said, impressive!

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The Business Behind The News is written, edited, and published by Chris Thompson.