SpaceX’s Debut Quarter Fails To Lift Off: Short Seller Chanos Flags Starship Forecast Cut — But Wall Street Still Sees Big Upside

• Analyst Tim Farrar cautioned that the revised cadence could be a year-end goal, rather than imply 50-100 launches throughout 2027.
• Starship’s Flight 14 reached orbit and deployed 26 operational Starlink V3 satellites before ending earlier than planned.
• Needham maintained its ‘Buy’ rating and $250 target, implying 66% upside, citing AI deals with a potential $54 billion annualized revenue run rate.

Elon Musk-led Space Exploration Technologies Corp. (SPCX) ended its first full quarter as a public company in the red. Short seller Jim Chanos challenged its Starship launch outlook, even as a Wall Street analyst sees more than 60% upside driven by AI compute growth.

SpaceX shares closed 1.1% higher at $150.86 on Wednesday. The stock fell 12% in the third quarter despite gaining 5% in September, its second straight monthly gain.

Chanos Flags 80% Starship Forecast Cut

Chanos, founder of Kynikos Associates and the short seller known for predicting Enron's 2001 collapse, weighed in after satellite communications consultant Tim Farrar highlighted a shift in Musk's launch targets.

On SpaceX's Aug. 4 earnings call, Musk said that "probably a year from now, we will be doing at least one flight a day, possibly more." 

Musk offered a different target in an interview this week alongside Nvidia CEO Jensen Huang. “We deployed V3 Starlink satellites, which are enormous. These are satellites with a wingspan of a 737. Next year, we expect Starship to reach a weekly or twice weekly launch cadence,” Musk said. Aaron Burnett, founder and CEO of space-focused investment and research firm Mach33, interpreted the target as “50-100 launches annualized in 2027.” 

“At the midpoint (75 launches) this is an 80% cut in forecasted 2027 Starship launches by Musk. Seems material,” Chanos said on X. His calculation compares 75 launches with 365 at a sustained daily rate. 

Analyst Questions 2027 Launch Math

Farrar argued that even the revised cadence could represent a year-end objective rather than a launch rate sustained throughout 2027. “I don’t doubt that 1-2 per week represents at best an end of 2027 objective and likely will be further downgraded/pushed out,” he said, challenging Burnett’s annualized interpretation.

“Some things Musk predicts happen late, others not at all. Deciding which of his predictions will fall into the first or second category is the hard part,” Farrar added.

The debate followed Starship’s Flight 14 launch this week, which reached orbit for the first time and deployed 26 operational Starlink V3 satellites before the mission ended earlier than planned.  The larger V3 satellites make Starship’s launch frequency important to Starlink’s capacity expansion. Farrar had previously questioned targets involving 4,000 V3 satellites by the end of 2027, citing launch and terminal-production constraints.

Needham Sees AI Fueling 66% Upside

Needham maintained its ‘Buy’ rating and $250 price target, implying a 66% upside from current levels, after discussions with SpaceX’s investor relations team about AI compute contracts, Investing.com noted.

Most announced agreements are expected to ramp in the fourth quarter, with one beginning in December. The firm estimates the deals could generate $54 billion in combined annualized revenue, helping the company reach its target of about $100 billion in total annual recurring revenue by the end of 2026. Needham also adjusted its second-half 2026 and calendar 2027 AI revenue estimates to reflect a more gradual ramp and potentially uneven renewals. 

On Wall Street, SPCX retains a bullish bias. Among 37 analysts covering the stock, it has a consensus rating of ‘Strong Buy’ while their average 12-month price target implies the stock is still trading at a nearly 50% discount, according to Koyfin data.

FCC Opens More Spectrum For Starlink

Separately, the Federal Communications Commission (FCC) voted on Wednesday to expand satellite access to the 12.7-13.25 GHz and 42-42.5 GHz spectrum bands, providing another potential capacity boost for Starlink.  The changes permit additional downlink use in the 12.7 GHz band, including service to terminals on aircraft and boats. 

FCC Chairman Brendan Carr said the additional bandwidth would improve home internet service. “Making next-gen satellite broadband faster and more reliable will not only benefit current subscribers, but also enhance competition for all consumers,” he said. 

How Do Retail Traders Feel About SPCX?

On Stocktwits, retail sentiment for SPCX jumped to ‘bullish’ from ‘neutral’ levels a week ago amid ‘high’ message volume.

SPCX stock has declined 6% year-to-date.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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