Elon Musk recently said he thinks Space Exploration Technologies (SPCX +5.68%), or SpaceX, could be generating $1 trillion in annual revenue by 2030. That's an astounding projection given that the business generated roughly $18.7 billion in sales last year. For some additional context, the business grew revenue 33% annually to reach last year's revenue level.
If SpaceX were to reach $1 trillion in revenue by 2030, the company would need to grow its revenue roughly 5,248% over 2025's figure to hit that target. In other words, the company would need to grow its revenue at an average annual rate of 121.6% each year to hit that target -- an enormous rate of growth to deliver on average over a five-year period. On the other hand, the target could start to look far more reachable if it factors in an anticipated merger between SpaceX and Tesla (TSLA +3.49%).
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Is a Tesla merger Musk's path to getting SpaceX to $1 trillion in revenue?
Last year, Tesla posted roughly $94.83 billion in annual revenue. Notably, the company's sales actually declined roughly 3% year over year in the period -- marking the first-ever annual revenue decline in the business's history.
If you combined Tesla's and SpaceX's revenue for 2025, you'd reach roughly $103.5 billion in annual sales. Based on that figure, the combined business would need to grow revenue at a 57.4% compound annual growth rate (CAGR) over a five-year period.
That CAGR actually looks far more achievable because SpaceX grew revenue 33% last year, and it seems like there's a good chance that sales growth will actually accelerate this year, thanks to new artificial intelligence (AI) processing deals with Alphabet and other customers, along with continued growth for the company's rocket-launching and Starlink services.
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Key Data Points
With Tesla revenue currently declining and accounting for the vast majority of the two companies' combined revenue, the electric vehicle (EV) business could actually be a substantial drag on CAGR if the two companies were combined. Overall demand in the EV market has cooled, and Tesla in particular has seen significant declines in vehicle sales.
On the other hand, it's not unreasonable to expect Tesla to start recording real revenue from its robotaxi and humanoid robotics businesses within the next five years, offsetting potential continued declines in automotive revenue.
With the monumental growth needed to get SpaceX to $1 trillion in sales within the next five years in mind, it's possible that Elon Musk is hinting that a merger between SpaceX and Tesla is on the horizon. Of course, it's possible that he really believes SpaceX alone will reach $1 trillion in revenue by 2030. It's also possible that the famously ambitious tech leader is throwing out highly optimistic projections to help generate excitement among investors and shore up support for the company's highly growth-dependent valuation.
