Key Points:
Musk-to-Musk Pipeline: SpaceX/xAI buys Tesla Megapacks → powers Colossus AI data center in Memphis → Barclays models a pre-December merger announcement creating a $3.6 trillion combined company.
The Backlog That Rewrites the Story: Tesla booked $9 billion in new Megapack orders in six weeks this summer, with a single $3 billion Esyasoft contract covering 15 GWh of storage across the UK, Western Europe, the GCC, and India.
If Merger Odds Hold Above 50%: Kalshi prices a Tesla-SpaceX deal at better than 50% by spring 2027, and if Musk announces before the December 3 annual meeting, every share of TSLA converts at roughly 0.7 shares of SpaceX equity.
Revenue Shift Underway: Non-automotive revenue (energy and services combined) hit 27.3% of Tesla's $28.24 billion Q2 total, up from roughly 22% two years earlier, while SpaceX alone paid $329 million for Megapacks in the first half of 2026.
SpaceX wired $295 million to Tesla in a single quarter. Not for cars. For batteries.
Those batteries sit inside a building called Colossus. It is an AI data center in Memphis. Elon Musk's xAI built it. And he needed so much backup power that his rocket company became one of his car company's biggest energy customers.
I can't stop thinking about this.
Tesla reports earnings tonight after the close. Every headline you will see tomorrow morning will focus on the same number. Deliveries. The company shipped 486,532 vehicles last quarter. That is down 2.1% from a year ago. It sounds bad. The stock dropped to $368.06 from a 52-week high near $499. And every talking head on cable will tell you Tesla has a car problem.
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They are looking at the wrong business.
Here's what worries me. Not about Tesla. About everyone who owns Tesla and thinks they own a car company. Since 2024, SpaceX and its AI arm have spent roughly $1 billion buying Tesla Megapacks. Those are the giant battery boxes the size of a shipping container. They store power for when the grid falls short. And right now, every AI data center in the country is terrified of the grid falling short.
Tesla booked $9 billion in new Megapack orders in just six weeks this summer. The biggest single deal was $3 billion from a firm called Esyasoft. All told, that is enough battery storage to power nearly six million homes. The company's Shanghai Megafactory rolled out its one-thousandth unit in July 2025. And Meta, which also reports earnings tonight, signed Tesla up to supply batteries for a massive AI data center project in Wyoming.
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I don't think most people realize how fast this is moving. Tesla's energy division pulled in $3.14 billion last quarter. Services added another $4.58 billion. Together, the businesses that have nothing to do with cars now make up more than 27% of Tesla's total revenue. Two years ago, that number was closer to 22%.
The car side is getting squeezed. The $7,500 federal EV tax credit expired last September. Automotive gross margins excluding regulatory credits fell to 16.3%. Regulatory credit sales dropped 67%. The EPS estimate for tonight is 44 cents. Analysts do not expect a beat.
But the energy side tells a different story. In the first quarter, energy storage carried a 39.5% gross margin. More than double the car margin. That margin did dip in the second quarter because of some warranty costs. Still. The backlog is enormous. The factories are ramping. And the customer list now reads like a who's who of Big Tech and big government.
The number I keep coming back to is $295 million. That is what SpaceX paid Tesla for Megapacks in one quarter. Just April through June. Musk is his own best customer. His AI company needs the batteries his car company builds. His rocket company writes the check. And Barclays put out a note last week saying a full merger between Tesla and SpaceX could be announced before December. Prediction markets give it better than 50% odds by spring.
I get it. A lot of you bought Tesla years ago because you believed in the car. Maybe you still do. But tonight, when the numbers drop, skip past the delivery count. Look at the energy line. Look at the backlog. Look at who is buying.
Nobody knows what a combined Tesla-SpaceX entity looks like at $3.6 trillion. Nobody knows if the merger happens or if it does not. But I know this. The company reporting earnings tonight is not the same company it was two years ago. It sells batteries to the people building the brains of the future. And the man running it happens to own both sides of that deal.
The old Tesla sold you a car. The new Tesla keeps the lights on at an AI factory in Memphis.
More on this tomorrow.
— American Ledger
