Tesla earnings report hits tonight! Will Musk merge SpaceX and Tesla to build a $3 trillion AI empire?

According to CNN Business, as SpaceX completed a record-setting first public offering (IPO) in June, Wall Street is abuzz with discussion over whether Elon Musk will merge SpaceX and Tesla, creating a super tech giant with a market value of up to $3 trillion. Analysts say this move would not only integrate both sides’ AI resources, but also strengthen Musk’s absolute control over the group. The market is closely watching Tesla’s earnings call today (the 22nd), hoping Musk will reveal the next steps.
(Backgrounder: SpaceX 116 billion USD stock is set to be unfrozen! 30% of tradable shares locked by shorts)
(Background addition: SpaceX fell below its IPO price! Short positions surged to $25 billion, accounting for nearly 30% of the float)

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• Strategic fit is extremely high, greatly strengthening Musk’s control
• AI becomes the valuation core, analysts see an 80% chance of a merger
• Facing severe challenges: regulatory landmines and the risk that “magic” fails

As aerospace giant SpaceX completed a high-profile, record-setting initial public offering (IPO) in June this year, Wall Street’s focus has quickly shifted to Musk’s next major move. On July 22, 2026 (Taipei time), according to CNN Business, the market is currently hotly speculating whether Musk plans to merge SpaceX and electric vehicle maker Tesla to create a tech behemoth with a total market value of about $3 trillion, large enough to rival Microsoft.

Strategic fit is extremely high, greatly strengthening Musk’s control

This potential century-scale acquisition has highly compelling strategic logic. JPMorgan analyst Rajat Gupta said the merger would not only allow Musk to unify the visions, missions, and engineering leadership of the two companies, but also generate massive synergies. In terms of capital deployment, after the merger the combined entity would find it easier to raise funds in the market, and by integrating artificial intelligence (AI) businesses could improve operating efficiency, gaining an absolute advantage in the fierce AI race.

More importantly, it would change the equity structure. Currently, Musk has more than 80% of the absolute voting power at SpaceX, but only about 20% control at Tesla. If the merger succeeds, Musk’s real control over Tesla’s business would jump significantly, effectively reducing doubts and interference from external shareholders regarding his decisions.

AI becomes the valuation core, analysts see an 80% chance of a merger

In fact, investors’ focus on Tesla has already shifted. Although expectations for this quarter’s electric vehicle (EV) sales look solid, Wall Street has treated it as a secondary issue, turning instead to Robotaxi (autonomous ride-hailing), humanoid robots, and developments related to SpaceX.

Both companies’ extremely high valuations now rely heavily on breakthroughs in AI technology. Earlier this March, the two even jointly established a joint venture called “Terafab,” setting up a dedicated microchip factory in Austin, Texas. Based on these commonalities, Wedbush analyst Dan Ives boldly predicts that the likelihood of completing a merger before 2027 is over 80%. He emphasized: “From the perspective of data engineering and Musk’s ownership, this is simply too reasonable a move.” Early Tesla investor Ross Gerber also agreed, saying for investors who trust Musk, this is a “more compelling overall investment,” allowing everyone to directly “invest in Elon.”

Facing severe challenges: regulatory landmines and the risk that “magic” fails

Even though the merger blueprint looks promising, practical execution is still full of thorns. The first is the complex and tangled international regulatory hurdles. JPMorgan warned that Tesla has a large super factory in China and is highly dependent on local sales and profits; however, SpaceX has deep cooperation ties with the U.S. government and the military. This sensitive dual identity is highly likely to trigger stringent national security reviews and regulatory challenges in the merger process between the two countries.

In addition, the current valuations of the two companies—each around $1 trillion—are largely supported by Musk’s unique personal appeal (“Elon’s magic”). Analysts say that once this “magic” halo weakens after a merger, or if Musk’s previously controversial style of action once again gains momentum, the total value of this $3 trillion giant could face a risk of sharp volatility. The market is holding its breath for Tesla’s earnings call scheduled for the 22nd after the market closes, hoping Musk will personally provide answers.