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SpaceX Delivers, Tech Takes Off

Tech stocks lead Wall Street higher as fresh earnings reinforce confidence in AI spending.

Author

Elie Zakhour
October 22, 2026

Market Snapshot

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Market News

SpaceX Surges as Tech Stocks Rebound

Wednesday was Elon's, and the tape didn't pretend otherwise. SpaceX reported its first quarterly profit as a public company Tuesday night, and the numbers were hard to ignore: $14.6B in revenue, up 161%, and $4.4B in net income, compared with a $1.1B loss a year ago. Its Super Intelligence business, spanning AI infrastructure, Grok, Cursor, and advertising, generated $7.6B on its own. More than half of SpaceX's revenue now comes from AI-related operations. The stock jumped nearly 8%.

Big Tech helped carry the rest of the market higher. The Nasdaq gained 1.05%, the S&P 500 rose 0.58% for its third consecutive advance, and the Dow added roughly 360 points. AI infrastructure and technology stocks led, while smaller companies lagged behind. It was another positive session for the major indexes, though the gains weren't equally distributed across the market.

The other big story was a possible SpaceX-Tesla merger. Musk confirmed Tuesday night that both companies had formed independent special committees to explore combining the businesses, with himself excluded because of conflicts of interest. He described navigating the discussions as "tap dancing through a minefield" before admitting he thought a merger was a good idea. No terms, no timeline, and no guarantee of a deal. Wall Street is already trying to figure out what a combination of the two companies might look like.

Then after Wednesday's close, Meta and Tesla reported back to back. Meta's revenue rose 26% to $64.6B, even as a $9.9B legal charge weighed on operating profit. The company also announced a new non-voting share class through a stock dividend equivalent to a 2-for-1 split, while keeping its enormous AI investment plans intact. Shares rose around 4% after hours. Tesla reported roughly flat revenue and improving automotive margins, but net income fell 43%, reminding investors that stronger deliveries don't automatically translate into higher profits.

Oil remained another concern. Brent finished Wednesday near $109 before climbing back above $110 Thursday morning. Treasury yields also remained elevated, with the 10-year around 5.15%, and investors are looking toward the Fed's October 28 policy meeting. Separately, the OCC finalized new stablecoin regulations Wednesday, establishing a framework for issuers and related activities beginning in January 2027.

Peel Take: This market keeps coming back to one subject: AI revenue. Meta took a nearly $10B legal hit, went free cash flow negative for the quarter, and still saw its stock rise after hours as investors focused on the underlying business and a new share structure. SpaceX spent $19.6B on capex in three months and got rewarded for reporting its first quarterly profit as a public company. Oil is back above $110, Treasury yields remain elevated, and investors are still buying the AI story. Now Musk wants to explore combining a rocket company with an electric vehicle and robotics business. Wall Street has plenty to figure out.

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What's Ripe

Super Micro Computer (SMCI) 9.55% 

  • Pre-announced preliminary fiscal Q1 revenue of $18.5B to $19.5B, a full $4B above its prior $14.5B to $15.5B guide, and lifted the gross margin outlook to 12% to 12.5%.

  • Entered the week after a seven-session losing streak, with roughly 15% of the float sold short. Dell (+5.3%) and HPE caught the sympathy bid. Full print lands Nov 3.

  • Peel Take: A $4B guidance increase is a significant development, especially with investors still mindful of Supermicro's past accounting concerns. Strong AI server demand is clearly supporting revenue growth, but profitability remains just as important. With roughly 15% of the float sold short, the stronger outlook also helped fuel Wednesday's rally. The November 3 earnings report will offer a clearer picture of whether the improved revenue and gross margin expectations are sustainable.

Okta (OKTA) 7.54% 

  • PHP2Shell: two critical remote-code-execution vulnerabilities (CVSS 9.2) affecting widely used PHP web servers. Details leaked a day early, and Cloudflare detected attack attempts before patches shipped.

  • The whole aisle ripped: CrowdStrike +5.3%, Cloudflare about +6%, Zscaler up too. Nvidia also named Okta, CrowdStrike, and Zscaler among the cybersecurity firms integrating with its new AI-agent security platform.

  • Peel Take: Wednesday's developments highlighted just how important cybersecurity has become. Critical software vulnerabilities are a reminder of the risks companies face, while Nvidia's new AI-agent security platform points to another emerging area of demand. Okta's involvement positions it to participate in that opportunity, although the financial benefits will take time to materialize. For now, investors appear encouraged by the broader outlook for cybersecurity spending.

What's Rotten

AT&T (T) 6.45%

  • Beat and raised: adjusted EPS of $0.65 vs. $0.60, revenue of $32.3B (+5.3%), and full-year EPS guidance lifted to about $2.40. Still finished as the worst stock in the S&P 500.

  • Postpaid phone adds of 379,000 missed the 387,410 consensus, and churn rose to 0.92% from 0.86% in Q2, while Starlink Mobile just hit 22M monthly users globally, up 37% in a single quarter.

  • Peel Take: AT&T delivered stronger-than-expected earnings and raised its outlook, but investors were more focused on what comes next. Slower subscriber additions and the potential competitive threat from Starlink Mobile have introduced new questions about the wireless market. AT&T still has a large customer base and an established network, but Wednesday's reaction shows how closely investors are watching changes in the competitive landscape. Strong earnings helped, but they weren't enough to offset those concerns.

Netflix (NFLX) 5.31%

  • Q4 revenue guide of $13.44B came in under the $13.51B consensus, Q4 EPS guide of $0.67 missed $0.73, and the 2026 ad revenue outlook was cut to about $2.7B from $3B.

  • Lowest close since August 2024 after hitting a fresh 52-week low of $64.10 intraday. Needham downgraded to Hold and pulled its $120 target; the stock is down roughly 31% this year.

  • Peel Take: Netflix delivered a solid quarter, but its outlook raised questions about the pace of future growth. The $300M reduction in expected advertising revenue was particularly disappointing given how important that business has become to the company's strategy. Delays in rolling out new advertising capabilities appear to be slowing progress, although the long-term opportunity remains significant. Investors will now be looking for signs that advertising growth can regain momentum in the coming quarters.

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A PE-backed company starts with $160 million in debt and uses 75% of its $40 million annual free cash flow to repay debt. Assuming no other changes, how much debt remains after three years?

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