Episode summary
SpaceX, Tesla Boards Study Possible $3.5 Trillion Merger | Bloomberg Intelligence
Bloomberg Intelligence
· · 25 min · Hosts: Paul Sweeney, Scarlet Fu · Guests: Sana Pashankar, Matt Henriksson, George Ferguson, Geetha Ranganathan
Summary
Elon Musk said SpaceX and Tesla have formed special committees to explore a merger, and the reporting emphasized that the idea now looks more like a question of when than if. Musk is pushing the case by arguing that both companies belong together around AI, but the host and the reporter both noted that Tesla shareholder support is the real hurdle. SpaceX’s blowout quarter, driven by Starlink sales and a smaller loss profile in its AI business, is helping strengthen the pitch for a combination.
Abbott Laboratories is spinning off its nutrition business, which the analyst said has become a distraction because of litigation, contamination issues, and slower adaptation to a more consumer-oriented market. Abbott’s core growth engine, continuous glucose monitors, is also slowing sharply, and the company cut its comparable sales growth outlook to 6% from 6.5% to 7.5%.
United Airlines and Netflix both disappointed investors despite some reassuring commentary. United warned of weaker-than-expected earnings from jet fuel costs, while the analyst said the stock reaction reflected a reset of expectations on fares and capacity. Netflix missed on revenue growth and cut its advertising outlook, with the analyst saying the ad business is growing more slowly because the company is still building its ad stack and content spending is rising without enough breakout hits.
Key takeaways
- The reporter said a SpaceX-Tesla merger now looks closer to a timing question than a possibility question, but Tesla shareholder approval remains the key obstacle.
- SpaceX’s quarter was described as a blowout, with Starlink and lower losses in its AI business supporting the merger narrative.
- Abbott is separating its nutrition unit because litigation and slower consumer-market adaptation have become a drag on the conglomerate.
- The analyst said Abbott’s continuous glucose monitor growth has slowed from 20% in 2024 to 7% this year, forcing a cut to companywide sales guidance.
- United Airlines and Delta were described as better positioned to pass through fuel costs, but the airline industry still faces a difficult capacity-and-fares tradeoff.
- Netflix’s ad outlook was cut about 10%, and the analyst said the business is still building the ad relationships and technology it needs.
Notable quotes
“I do think there's a lot of merit to combining the companies. Um, as we are pretty much in the super intelligence singularity, I think it would be a good idea”
“it almost seems as if it's rather a when rather than an if”
“SpaceX really had a blowout quarter. Um it basically exceeded estimates in net income, net profit, revenue”
“it's their nutrition business which is their baby formula, their adult nutrition formula. So everything in Simolac for the uh pediatric patients”
“the fact that they pulled guidance down for the advertising revenue by about 10% for this year, which then weighed on the 4Q guidance”
How the episode opens
Bloomberg Audio Studios, podcasts, radio, news. You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10 a.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business App. — Listen on demand wherever you get your podcasts or watch us live on YouTube. Let's get back to that Elon Musk story because it story that just keeps on giving and it's if it comes together mega deal for the bankers and the lawyers.
You look at the function and the biggest deal of the year is already tied to SpaceX with XAI. — Yep. Absolutely. So, here we go. Elon Musk says SpaceX and Tesla have formed special committees to explore a potential merger. He spoke in a earnings call following SpaceX blowout earnings. Let's take a listen. I do think there's a lot of merit to combining the companies. Um, as we are pretty much in the super intelligence singularity, I think it would be a good idea, but it it's really up to the special committees of both companies
Apparently. Yeah.
All right. Very cool. That's good.
If he says it's a go, it's likely to be a go. We're seeing that in the stock prices here at both uh SpaceX and Tesla trading up here today. Let's get some more reporting on that.
Uh, Sana Pashankar is our space reporter for Bloomberg News down there in DC. Sana, what's what's the makeup of the folks you talked to about the potential here for a merger of SpaceX and Tesla? That's certainly what I think a lot of Tesla investors are waiting for.
Yeah, totally. So, what from what I'm hearing from people I'm speaking to and kind of what we heard from Musk yesterday, um, it almost seems as if it's rather a when rather than an if.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- spacex tesla merger
- tesla shareholder support
- abbott nutrition spin-off
- airline fuel costs
- netflix earnings slowdown
Companies and tickers mentioned
- TSLA
- ABT
- UAL
- NFLX
- SpaceX
- Tesla
- Abbott Laboratories
- United Airlines
- Netflix
Watch the episode
Watch “SpaceX, Tesla Boards Study Possible $3.5 Trillion Merger | Bloomberg Intelligence” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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