SpaceX Q2 Earnings: Terafab's $119B Chip Bet Takes Center Stage

📌 UPDATE — August 6, 2026

New details have emerged on the scale and location of the Terafab project. The facility will be built approximately 130 miles east of Giga Texas, near College Station in Grimes County — a site distinct from Tesla's existing Austin footprint. The initial Phase 1 investment is confirmed at $16.8 billion combined from Tesla and SpaceX, with the full multi-phase buildout potentially reaching the previously reported $119 billion figure. Elon Musk has now directly confirmed that Phase 1 alone will generate 3,000 jobs in Texas — and with up to 10 phases planned, total job creation could scale dramatically beyond that figure.

📌 UPDATE — August 6, 2026

Tesla and SpaceX have officially confirmed Terafab's location: Grimes County, Texas — approximately 130 miles east of Giga Texas. Both companies posted simultaneously, with Tesla revealing that a precursor research fab broke ground in April on Giga Texas's North Campus. Elon Musk declared Terafab will be "the largest and most valuable building on Earth by far" and promised it will be "stunningly beautiful." The facility is projected to span roughly ~100 million sq ft — approximately 10× the size of Giga Texas — to meet chip demand that current and future global production capacity cannot satisfy.

@Tesla: "Both Tesla & SpaceX will need far more chips than current & future global production can supply. This is why we're building [Terafab]."
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@elonmusk: "Terafab Texas will be the largest and most valuable building on Earth by far. And it will be stunningly beautiful."
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▶ Watch Tesla's official Terafab reveal video

📌 UPDATE — August 4, 2026

SpaceX's Q2 earnings call is now complete, delivering headline revenue of $7.8B vs. the $6.8B analyst estimate — a significant beat. However, shares fell ~6.5% after hours as investors appeared to sell the news following a 9.4% intraday run-up. Starlink subscriber count came in at 12.0M (vs. 12.2M expected), though average revenue per user of $66/month edged past the $65.60 estimate. Total costs of $8.0B came in below the $8.3B forecast.

The headline subscriber metric was Starlink's record-breaking quarter: COO Gwynne Shotwell confirmed net additions of over 1.7 million subscribers globally — the best quarter in Starlink's history. Shotwell added, "It really feels like we're just getting started all over again." Elon Musk made a bold long-term claim on the call: "It's not out of the question that Starlink will deliver a majority of the world's Internet."

Sources: @SawyerMerritt, @garyblack00 via X — August 4, 2026

SpaceX is holding its Q2 2026 Financial Results meeting today, August 4 — its first earnings teleconference since going public on June 12, 2026. While analysts will be parsing revenue figures and guidance, one line item is drawing outsized attention: capital expenditure commitments tied to Terafab, a proposed $119 billion semiconductor manufacturing complex planned for Grimes County, Texas.

▶ Watch Video on X

The Meeting: SpaceX's Public Debut on Earnings

The call is scheduled for 4:30 PM ET / 3:30 PM CT, broadcast as an audio-only webcast via SpaceX's investor relations site (ir.spacex.com) and livestreamed on X. It's a significant moment — SpaceX has historically operated as a private company with no obligation to disclose financials publicly. The IPO changed that calculus entirely.

According to analyst estimates, the market is expecting Q2 2026 total revenue of approximately $6.93 billion, broken down across three segments: Connectivity (Starlink) at $3.83 billion, AI at $2.18 billion, and Space launch services at $835 million. Earnings per share is projected at negative $0.26, reflecting the capital-intensive nature of the company's current expansion phase. Shares are trading around $117 as of today — roughly 50% below the post-IPO high of over $225.

Beyond the headline numbers, investors and analysts are focused on two things: Q3 guidance and, critically, how management frames capital expenditure commitments for projects like Terafab.

What Is Terafab — and Why Does It Matter to This Call?

Terafab is arguably the most ambitious industrial project in SpaceX's pipeline. Planned for a site near the Gibbons Creek Reservoir in Grimes County, Texas — approximately 90 miles northeast of Austin — the facility is described as a multi-phase, vertically integrated semiconductor manufacturing and advanced computing fabrication complex.

The numbers are staggering. According to reporting on the project, total investment across all phases is expected to reach upwards of $119 billion, with the first phase alone projected at $55 billion. The proposed footprint is 100 million square feet — ten times the size of Giga Texas. The stated output target is 1 terawatt of chip compute per year.

The chips produced at Terafab would serve multiple parts of the Musk industrial ecosystem: Starlink satellites, Tesla vehicles, xAI's orbital data centers, and broader AI infrastructure. That cross-entity scope makes the CAPEX question particularly complex for investors trying to model SpaceX's standalone financials — how much of Terafab's cost lands on SpaceX's balance sheet, and how much is shared with or funded by Tesla and xAI?

Local Approvals Already in Place

Terafab has moved faster on the regulatory front than most projects of this scale. On June 3, 2026, Grimes County Commissioners voted 4-1 to approve a reinvestment zone and a 100% property tax abatement for the project. The facility is projected to create over 3,000 jobs in the region. Some state-level determinations were still pending or recently concluded as of today's meeting.

That local approval timeline matters: it signals the project is past the speculative phase and into active permitting and planning. What today's earnings call may clarify is when SpaceX intends to begin committing capital — and at what scale.

The Broader Context for Tesla Owners

For the Tesla community specifically, Terafab isn't a peripheral SpaceX story. If the facility delivers on its stated purpose — producing chips for Tesla vehicles among other applications — it represents a potential vertical integration play that could reduce Tesla's dependence on third-party semiconductor suppliers. The chip supply constraints that disrupted EV production globally in 2021-2022 haven't been forgotten. A captive, domestically produced chip supply at terawatt-scale compute output would be a structural advantage that's hard to overstate.

Today's earnings call won't resolve all of these questions, but it's the first time SpaceX management will address them publicly on the record. Watch the CAPEX guidance closely — that's where the real signal will be. For our ongoing SpaceX coverage, we'll be following the call as results come in.

This report was curated by the BASENOR Editorial Desk from the sources listed above. Read our editorial standards or email editorial@basenor.com to report an error.