Deepwater Asset Management’s Gene Munster predicted Grok 5 could become "the most useful engineering tool in history" as Space Exploration Technologies Corp. (NASDAQ: SPCX) prepares to train the model on its quarter-century of engineering data.

Timely release of Grok 4.7

Munster made the call after SpaceXAI released Grok 4.7 on Monday, Sept. 21, about three weeks after Musk’s Sept. 1 target. "For all the heat that Elon gets on product delays, it’s worth noting that he effectively shipped a product on time today," Munster wrote on X, calling Sept. 1 and Sept. 21 "essentially the same." SpaceXAI officially launched the model Monday.

"This increases the odds that Grok 5, which will be a game changer (mark my words) comes out more or less on time. Elon said that would be late this year," he said.

Integration of SpaceX data

"What’s going to make Grok 5 special is it’s ‘incorporating the entire corpus of SpaceX data. Basically, all the data that SpaceX has ever produced, which is a tremendous amount over the course of a quarter century,’" Munster wrote, quoting Musk. "Translation: Grok 5 will be the most useful engineering tool in history."

SpaceX’s SEC filings show Grok 5 is already in development. Colossus II, its Memphis AI complex, currently trains the model, while SpaceX says the facility deployed Nvidia GB200 and GB300 processors at scale.

Performance metrics and financial context

Grok 4.7 became available through the Grok API, Cursor and Grok Build Monday. SpaceXAI, in its release notes calls it its strongest model for coding and knowledge work, with a 500,000-token context window. It uses a larger base model than Grok 4.6 and longer reinforcement-learning training weighted toward multi-hour tasks.

On xAI’s benchmarks, Grok 4.7 scored 46.3% on CursorBench 4.0 versus 40.4% for Grok 4.6 and 64% on EEBench. Those company-reported results show gains over Grok 4.6 but do not establish Grok 5’s performance.

Reuters reported that SpaceX’s AI revenue jumped about 250% year over year in the second quarter, while AI capital spending reached $15.83 billion. Musk said SpaceX expects more than two gigawatts of compute capacity this year and close to 10 gigawatts by the end of 2027.

What the numbers show

The combination of a 250% year-over-year jump in AI revenue and $15.83 billion in AI capital spending indicates an aggressive expansion phase where infrastructure costs are scaling rapidly alongside revenue growth. The reliance on Nvidia GB200 and GB300 processors at Colossus II highlights a hardware-intensive strategy to support the training of models like Grok 5, which aims to leverage decades of proprietary engineering data.

Morgan Stanley analysts argue that deepening technological and infrastructural ties between Tesla Inc. (NASDAQ: TSLA) and Space Exploration Technologies Corp. (NASDAQ: SPCX) could lead to a merger. The bank views the companies' joint push into physical AI as a "shared mission" to convert energy into intelligence.

Deepening Web Of Shared Infrastructure

Analysts led by Adam Jonas noted that the two firms share technology, talent, and infrastructure. As large language models approach performance limits, investor attention is shifting toward physical AI, an opportunity Morgan Stanley believes the companies are uniquely capable of addressing, potentially jointly.

The analysts identified 71 mentions of Tesla in SpaceX's S-1 filing. Of these references, 34% cited direct collaboration, while 41% related to governance and related-party transactions.

Compute And Connectivity Flow Both Ways

The companies are jointly building Terafab, a Texas chip factory with Intel Corp. (NASDAQ: INTC), at a cost exceeding $119 billion. They are also co-developing an AI platform called Macrohard.

SpaceX purchased $506 million worth of Tesla Megapacks and $131 million worth of Cybertrucks in 2025 for its Colossus compute cluster. Quarterly filings showed Megapack purchases totaled $329 million in the first half of the year.

SpaceX supplies Tesla with compute capacity set to reach 4.9 gigawatts by 2027, along with Starlink connectivity for the Cybercab. In return, Tesla provides SpaceX with data-collecting robots, energy storage technology, and manufacturing expertise from a workforce more than six times larger than SpaceX's.

Musk Has Fueled Merger Talk

Elon Musk recently suggested that the extensive collaboration between the firms warrants consideration of a merger. Speaking on the All In Podcast with SpaceX President Gwynne Shotwell, Musk asked listeners to imagine what action might be taken given the close collaboration across multiple areas.

Investor Ross Gerber stated that a merger could become a "must-have" investment for global investors. However, he warned it would be dilutive for SpaceX shareholders and unfavorable for Tesla investors based on current valuations.

SpaceX holds a valuation of $2.06 trillion, compared to Tesla's $1.48 trillion, according to TradingView.

What the Numbers Show

The valuation gap between the two entities is significant. SpaceX is valued at $2.06 trillion, which is approximately 39% higher than Tesla's $1.48 trillion valuation. This disparity underscores Gerber's warning regarding potential dilution for SpaceX shareholders in any combined entity.

Market Reaction

SpaceX shares closed 0.56% lower on Monday at $151.85 before climbing 0.58% in extended trading. Tesla shares rose 3.03% to close at $375.30, then fell 0.01% in after-hours trading. Benzinga edge rankings indicate SpaceX stock has a positive price trend across short, medium, and long-term horizons.