Elon Musk's corporate universe could be headed for its biggest combination yet, according to Wedbush analyst Dan Ives, who is now putting an 80% probability on a Tesla Inc. (NASDAQ:TSLA) and SpaceX merger.
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Ives made the call in a Wednesday note after SpaceX officially filed its S-1 to go public, a move Wedbush called the largest IPO in stock market history and a "major moment" for space and tech.
The analyst also repeated the merger view during an appearance on Anthony Pompliano's podcast, saying the odds of a Tesla-SpaceX combination are now about 80%.
Wedbush expects the two Musk-led companies to merge in 2027 after the SpaceX IPO, arguing that the connective tissue between the businesses is already being built.
The firm pointed to Tesla's existing stake in SpaceX, which resulted from Tesla's $2 billion investment in xAI being converted into SpaceX shares following SpaceX's acquisition of xAI earlier this year.
While that stake represents less than 1% of SpaceX's expected valuation, Wedbush said it marks an important structural link.
Musk's AI Ecosystem
The bigger strategic rationale, in Ives' view, is artificial intelligence.
SpaceX's S-1 lays out a $28.5 trillion total addressable market (TAM) spanning space-enabled solutions, connectivity and AI, including $22.7 trillion in enterprise applications.
The filing also highlights SpaceX's push to own more of the physical AI compute stack, including planned V3 satellites in the second half of 2026 and solar-powered AI compute satellites by 2028.
Wedbush said the recently announced joint Terafab facility between Tesla and SpaceX further strengthens the case by creating operational overlap.
Ives framed the potential combination as part of Musk's broader push to control more of the AI ecosystem.
Tesla brings manufacturing scale, energy storage, robotics and vehicle data, while SpaceX adds satellite infrastructure, Starlink connectivity and xAI's Grok platform.
"Musk wants to own and control more of the AI ecosystem," Ives wrote, adding that the "holy grail" could be combining SpaceX and Tesla "in some way" to create deeper connective tissue between two disruptive tech giants looking to lead the AI revolution.
SpaceX's filing said Musk will remain CEO, CTO and chairman after the IPO while retaining majority voting power, keeping him firmly in control of the newly public company.
TSLA Investors
For Tesla investors, a potential SpaceX merger would likely sharpen the debate around Musk's sprawling empire: one side sees a unified AI, energy, mobility and space platform; the other sees governance complexity and another distraction.
TSLA Price Action: Tesla stock was up 1.81% at $424.92 on Thursday morning, according to data from Benzinga Pro.
This image was generated using artificial intelligence via Gemini.
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