Earnings this week: Up in the air

It’s been a rough week for AI stocks, as investors started to question whether the technology will deliver the revenue they’ve been banking on. Netflix kicks things off on Tuesday after the close, days after its biggest round of job cuts to date. Then SpaceX reports what could be its first profit as a public company, though it faces questions over its huge AI spending and the row over Starshield in Ukraine.

On Wednesday, Meta and Tesla wrap things up. Meta’s update is a big test of Wall Street’s appetite for AI before Alphabet, Microsoft, and Amazon report next week. For Musk, it’s a double bill with SpaceX and Tesla reporting back-to-back, fresh from last week’s flying Roadster stunt, which the two companies worked on together.

Netflix – Ad break

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Earnings release: Q3 2026, Tuesday 20 October, after market close

Revenue estimate: $12.88bn

EPS estimate: $0.82

Tudum. On paper, Netflix is in rude health. Last year, it made an $11bn profit on revenue up 16% to $45.2bn, and Q2 revenue rose 13.4% year-on-year to $12.56bn, with a 33.4% operating margin. So why has it just cut around 1,000 jobs, its biggest round of layoffs to date?

The answer is domestic growth. Revenue growth in the US and Canada slowed from 14% to 10% in Q2, and Netflix’s guidance of roughly 12% growth for Q3 came in below expectations. The shares are down around 20% this year, and Netflix hasn’t always hit the mark: this time last year, a Brazilian tax charge left EPS around 15% short of forecasts. A day after the cuts, it replaced chief content officer Bela Bajaria with former Disney and Fox exec Peter Rice.

Make no mistake, this is still a profitable business. Netflix is aiming to lift its full-year operating margin by two percentage points to 31.5%, and expects operating income to grow by more than 20% this year.

Ads were once a no-go for Netflix, but they’re now the fastest-growing part of the business, with ad revenue expected to roughly double this year to around $3bn. Management says the cuts will free up cash to invest in growth areas like this. Expect plenty of questions about the shake-up on Tuesday.

SpaceX – Burn rate

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Earnings release: Q3 2026, Tuesday 20 October, after market close

Revenue estimate: $12.89bn

EPS estimate: $0.14

SpaceX is no longer just a rocket company. Alongside its launch business, it runs Starlink, the satellite internet service, and an AI division that includes the Grok chatbot. In its first-ever earnings report in August, revenue jumped 92% year-on-year to $7.8bn, with its Starlink-led connectivity business bringing in $4.3bn and AI revenue more than tripling to $2.6bn. It still made a net loss of $541m. This quarter, analysts expect revenue to leap by around 65% from Q2, with AI set to overtake connectivity as the biggest earner. If the consensus is right, SpaceX will post its first positive quarterly EPS since listing, after a loss of $0.09 per share in Q2.

SpaceX also heads into the update amid controversy over Starshield, its military-grade version of Starlink, after Ukraine said access had been restricted without warning. Musk says the restrictions came from the US government. It’s the kind of row that could test government customers’ trust in Starlink.

SpaceX poured $18.4bn into capex last quarter, $15.8bn of it on AI, and it’s expected to spend even more this time. The shares have fallen by around 10% in the past week amid a wider sell-off in AI stocks.

Meta – Big spender

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Earnings release: Q3 2026, Wednesday 21 October, after market close

Revenue estimate: $63.28bn

EPS estimate: $6.50

Meta’s last update saw the firm’s advertising engine purring along, with total revenue up 28% to $60.8bn. But profits went the other way. EPS fell 13% to $6.18, well short of forecasts, weighed down by $2.4bn of legal charges and $1.18bn of severance costs after May’s job cuts.

Guidance didn’t help. Meta pointed to Q3 revenue of $61bn–$64bn, with the midpoint below what analysts had hoped for. The shares fell around 9% the next day.

The elephant is AI spending. Meta has narrowed its full-year capex guidance to $130bn–$145bn, raising the bottom of the range, and much of that goes on data centres and chips. Investors will want signs this ginormous outlay is turning into revenue. Analysts expect that spending to bite this quarter, with operating income forecast to fall year-on-year and margins slipping to just under 30%.

The firm’s new personal AI agent, Muse Spark, was one of the company’s biggest launches in years, and it reached 5 million downloads faster than ChatGPT, Claude, or Grok. Bank of America reckons the launch has put Meta back on the front foot in AI.

Tesla – We don’t need roads

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Earnings release: Q3 2026, Wednesday 21 October, after market close

Revenue estimate: $27.62bn

EPS estimate: $0.41

Tesla’s delivery figures, out earlier this month, beat expectations. It delivered 486,532 vehicles in Q3. That’s down 2.1% year-on-year, but ahead of the roughly 462,000 analysts expected. Energy storage deployments rose almost 10% to 13.7 GWh, a reminder that batteries for homes and the grid are a growing part of the business.

Profitability is the issue. Q2 revenue of $28.24bn beat forecasts, but adjusted EPS of $0.33 fell well short. Analysts expect Q3 revenue to come in roughly flat to slightly down year-on-year. At the same time, Tesla is spending on AI and manufacturing, and free cash flow turned negative in Q2.

As ever with Tesla, the call may matter more than the numbers. Last week’s Roadster reveal, a prototype that leapt over cars and flipped in mid-air using thrusters built with SpaceX, showed Musk can still put on a show, even if production isn’t due until 2028. Expect plenty of airtime for that, along with Optimus and robotaxis.