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Profit is the result of all operations, not just launches. For instance, starlink is a SpaceX company. Starlink is reported to be responsible for up to 40% of S

by rewmie 3y ago

Profit is the result of all operations, not just launches. For instance, starlink is a SpaceX company. Starlink is reported to be responsible for up to 40% of SpaceX's revenue. https://spacenews.com/starlink-may-account-for-up-to-40-of-spacexs-2023-revenues/ https://spacenews.com/starlink-may-account-for-up-to-40-of-s...

TMWNN 3y ago
Irrelevant. Hollywood accounting works because a film studio can, by shifting expenses to a particular film from elsewhere in the company, always claim that the film is unprofitable; the overall revenue and profit/loss for the studio is unaffected. The documents WSJ viewed are for SpaceX as a whole, not "SpaceX's launcher division". Even if the launcher division charged the Starlink division 9000 megazillion dollars per launch, that would be exactly balanced by the Starlink division having to book 9000 megazillion dollars of expense per launch. Again, according to the documents WSJ viewed, SpaceX overall has achieved profitability. That's a major accomplishment given it being by far the lowest-cost launch provider in the world.
- rewmie 3y ago
  > Irrelevant. Hollywood accounting works because (...) I don't think you understood what I wrote. GP claimed "SpaceX is profitable, so they're not pricing below cost", but the bulk of SpaceX's revenue can be attributed to the company owner transferring his money around. Your comment is so far off it reads as something outputted by a poor machine learning model.
  - TMWNN 3y ago
    > I don't think you understood what I wrote. GP claimed "SpaceX is profitable, so they're not pricing below cost", but the bulk of SpaceX's revenue can be attributed to the company owner transferring his money around. My point is that even if SpaceX books Starlink launches as revenue,[1] it would still have to be accounted for as an expense on Starlink's side, so SpaceX's overall bottom line would not change. If SpaceX's confidential internal financials show that SpaceX has achieved profitability then, yes, that indicates that SpaceX is not pricing its launches below cost. >Your comment is so far off it reads as something outputted by a poor machine learning model. Sorry, not my fault that you can't comprehend the fact that revenue can't come out of nowhere. It has to always be balanced by expense, and this isn't some magic way for Musk to generate "fake profits". [1] A fairly common business practice, in and of itself. When an Apple employee receives a new Apple computer for use at work, that computer is booked as revenue for Apple; after all, Apple is acting as a customer for a product, albeit its own. The division that employee works for in turns records the price of that computer as an expense. The revenue amount is going to be lower than what an outside customer would pay—basically, Apple as seller will charge Apple as customer zero markup—but some revenue will be recorded all the same.

by rewmie 3y ago

TMWNN 3y ago

Irrelevant. Hollywood accounting works because a film studio can, by shifting expenses to a particular film from elsewhere in the company, always claim that the film is unprofitable; the overall revenue and profit/loss for the studio is unaffected. The documents WSJ viewed are for SpaceX as a whole, not "SpaceX's launcher division". Even if the launcher division charged the Starlink division 9000 megazillion dollars per launch, that would be exactly balanced by the Starlink division having to book 9000 megazillion dollars of expense per launch. Again, according to the documents WSJ viewed, SpaceX overall has achieved profitability. That's a major accomplishment given it being by far the lowest-cost launch provider in the world.

rewmie 3y ago
> Irrelevant. Hollywood accounting works because (...) I don't think you understood what I wrote. GP claimed "SpaceX is profitable, so they're not pricing below cost", but the bulk of SpaceX's revenue can be attributed to the company owner transferring his money around. Your comment is so far off it reads as something outputted by a poor machine learning model.
- TMWNN 3y ago
  > I don't think you understood what I wrote. GP claimed "SpaceX is profitable, so they're not pricing below cost", but the bulk of SpaceX's revenue can be attributed to the company owner transferring his money around. My point is that even if SpaceX books Starlink launches as revenue,[1] it would still have to be accounted for as an expense on Starlink's side, so SpaceX's overall bottom line would not change. If SpaceX's confidential internal financials show that SpaceX has achieved profitability then, yes, that indicates that SpaceX is not pricing its launches below cost. >Your comment is so far off it reads as something outputted by a poor machine learning model. Sorry, not my fault that you can't comprehend the fact that revenue can't come out of nowhere. It has to always be balanced by expense, and this isn't some magic way for Musk to generate "fake profits". [1] A fairly common business practice, in and of itself. When an Apple employee receives a new Apple computer for use at work, that computer is booked as revenue for Apple; after all, Apple is acting as a customer for a product, albeit its own. The division that employee works for in turns records the price of that computer as an expense. The revenue amount is going to be lower than what an outside customer would pay—basically, Apple as seller will charge Apple as customer zero markup—but some revenue will be recorded all the same.