Track market-moving stories before they get noisy

Space Exploration Technologies (SPCX -2.29%) stock is not off to a great start. Although the stock soared in its first week of trading, at this writing it's 27% off its high and trading below its first-day opening price.

There's a lot to like about SpaceX, and the company is just getting started in its three businesses: rocket launching, satellite broadband, and artificial intelligence (AI). If you have $5,000 to invest, here's how much it might be worth in 2031.

Image source: Getty Images.

SpaceX is much more than space SpaceX is known for its rocket-launching business that brings space exploration to new levels. It's perfecting its reusable rocket technology, which should make the process more affordable and increase access to space travel. It sends rockets to bring satellites into space, and it also works with private clients, including the U.S. government. It already has 78 launches year to date as of the end of the second quarter.

Starlink is its satellite broadband business, and it's the largest of its kind. It has 10,200 satellites in orbit and serves 12 million customers in 167 countries.

Finally, it merged with Elon Musk's xAI earlier this year, rounding out its business portfolio. xAI makes money by selling data center space to cloud companies and through its large-language model (LLM), Grok.

The first two businesses have a strong connection, and both are based around some kind of space technology. xAI fits in more tangentially, as Musk envisions sending data centers into space to be powered by the sun.

The company as a whole delivered strong performance in the 2026 second quarter, its first as a public company. Revenue increased 92% year over year, a smashing opening, and net loss improved from $1 billion to $541 million. Space revenue increased 29%, but it's still not profitable. The company is investing in research and development, which it believes will eventually lead to a 99% reduction in costs from the historical average, as well as expand its market opportunity.

Starlink revenue was up 66% over last year, and operating income increased 79%. Starlink is way ahead of any competition, and customer count doubled year over year.

Finally, AI sales were up 247% over last year, although its dragging down total profitability; Operating loss was $1.3 billion. This is where the company is spending, and capital expenditures were $15.8 billion in the second quarter. It makes sense, considering that this is where management sees its greatest opportunities.

What could happen over the next five years Wall Street expects revenue to 137% in 2027, an acceleration from today's already phenomenal rates. Analysts are looking for $39 billion in full-year revenue for 2026, which makes SpaceX a fairly small company. Tesla, for example, Musk's original company, has $103.6 billion in trailing 12-month revenue.

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Here are a few options for how much revenue SpaceX might have in 2031, based on different compound annual growth rates (CAGR):

100%: $1.25 trillion 50%: $296 billion 30%: $144.8 billion That's quite a range. The 100% rate doesn't seem plausible, but if you assume a 50% CAGR, keeping the price-to-sales ratio of 69 constant, the market cap would exceed $20 trillion. That seems hard to believe, and you have to assume the ratio will come down. If it's halved, the market cap would still be an eye-raising $10 trillion, although that's more reasonable for five years from now.

I would say that's the best-case scenario, and it implies the stock gaining 500% from nearly $2 trillion today. If it happens, your $5,000 would be worth $25,000. More realistically, though, I think the ratio will come down further, and the CAGR is likely to as well. Using 20 as a more reasonable price-to-sales estimate with a 50% CAGR, SpaceX stock would be worth $5.9 trillion, and your $5,000 investment could be worth $15,000. At a 30% CAGR, the market cap would be only $2.9 trillion, and your investment would be worth $7,250. Keep in mind that SpaceX is fairly risky today, since it isn't profitable, and the end result could be very different from what came out of this exercise.

SpaceX (NASDAQ: SPCX) could be positioned for further gains after attracting more than $7 billion in institutional inflows over the past year.

Data shows that 108 institutional investors accumulated SpaceX shares over the last 12 months, generating total inflows of approximately $7.27 billion. Notably, filings show no reported institutional sellers during the same period.

SPCX institutional ownership. Source: Market Beat The accumulation trend comes as investors continue to bet on the long-term growth potential of Starlink, Starship, government contracts, and emerging artificial intelligence opportunities tied to SpaceX’s communications infrastructure.

Among the largest reported positions is K5 Global Advisor LLC, which disclosed ownership of 38.6 million shares valued at approximately $6.59 billion. Bond Capital Management LP reported more than 1.05 million shares worth about $180.62 million, while Value Aligned Research Advisors LLC held roughly 589,723 shares valued at $100.76 million.

Other investors reporting positions include Virginia Retirement Systems, Serenity Investment Advisors, TD Waterhouse Canada, Concurrent Investment Advisors, Turner Financial Group, Rik Saylor Financial, and several registered investment advisory firms.

While institutional ownership data is not a real-time indicator of buying activity, the absence of reported sellers alongside billions of dollars in inflows points to strong long-term conviction in SpaceX’s growth outlook.

ChatGPT SpaceX stock price prediction Using the latest institutional ownership trends alongside SpaceX’s growth outlook, ChatGPT projects a base-case valuation range of $2.4 trillion to $2.8 trillion over the next 12 months.

Under this scenario, SpaceX stock could trade between $180 and $210 per share, representing potential upside of roughly 22% to 42% from the press time share price of $147.

The forecast assumes continued growth in Starlink subscribers, expansion of enterprise and government contracts, and progress toward commercial deployment of the Starship launch system.

A more bullish outcome could emerge if Starship successfully enters commercial service and demonstrates meaningful cost advantages over existing launch vehicles. In that case, SpaceX could approach a valuation of $3 trillion to $3.7 trillion, implying a stock price range of $225 to $280 per share.

Conversely, slower-than-expected commercialization of Starship or weaker growth across key business segments could limit upside and keep the company closer to a valuation of $1.6 trillion, equivalent to approximately $120 to $135 per share.

Although institutional inflows highlight investor confidence, analysts increasingly view Starship as the most important catalyst for SpaceX’s valuation.

The fully reusable rocket is expected to significantly reduce launch costs while enabling larger payload deployments for Starlink and future commercial missions. 

Success in these areas could strengthen SpaceX’s position across satellite internet, launch services, defense contracts, and AI infrastructure markets.

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The bullish model assumes 50 flights per vehicle before Starship has completed one commercial mission. Summary

Nearly 49% projected upside depends on repeatable launch economics, not another successful test.

SpaceX SPCX, the rocket-launch and satellite-internet company, landed a fresh Buy rating and a $220 price target from Pivotal Research Tuesday. The stock erased an early advance and hovered near $147.92, leaving the analyst's target approximately 48.7% above the market price.

Pivotal's valuation argument places SpaceX near $3 trillion and puts Starship at the center of the upside. The firm assumes the spacecraft could slash launch expenses by as much as 90% and eventually fly roughly 50 missions per vehicle. Its $220 target also sits about 63% above the company's $135 June IPO price—a rich premium built on enormous operating improvements that remain unproven.

SpaceX calls Starship a fully reusable transportation system, yet it has not completed a commercial mission. The GF Score of just 15 out of 100 reinforces that disconnect: the chart shows weak profitability, growth, momentum and GF Value, with financial strength offering only limited support. Another successful test could move the engineering story forward, but the $3 trillion case ultimately demands fast turnarounds, repeatable flights and paying customers—not simply a rocket that leaves the launchpad.

Disclosures I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours.

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As Space Exploration Technologies Corp. (NASDAQ: SPCX) stock struggles with the company’s massive disconnect between its expected revenue for 2026 of between $22 billion and $30 billion and its speculative valuation of approximately $2 trillion on September 8, 2026, Jeffrey Wlodarczak, a Wall Street analyst at Pivotal Research, believes that Starship reusability is the fundamental engineering bottleneck that must be solved. 

Wlodarczak initiated a rating for SpaceX stock with a ‘Buy’, according to a note sent to clients on Tuesday. He set the firm’s 12-month price target for SPCX at $220, thereby signaling a potential 48.43% upside.

“Our $220 target is a call on reuse 20-50 flights per vehicle, cheap refurb, fast turnaround. If that is solved, the rest of the model can happen. If it is not, SPCX is a different and much smaller company,” Wlodarczak noted.

This analyst asserts that cheap, high-frequency launch capacity for the company’s Starship program could catalyze growth in Starlink’s network. As such, SpaceX could manage to capture a significant share of the $1.7 trillion terrestrial and wireless connectivity market. 

Additionally, Pivotal Research highlighted that cheap, high-frequency reusability of Starship would help SpaceX to bypass ground-based power grids. Consequently, Elon Musk could deploy more orbital data centers, positioning the company to obtain a substantial market share in the rapidly expanding neocloud and hyperscaler sector.

Is SpaceX a good stock to buy? Earlier on Tuesday, Ken Gawrelski, an expert at Wells Fargo & Co. (NYSE: WFC), assigned a ‘Buy’ rating for SpaceX. Gawrelski, however, lowered the firm’s 12-month price target for SPCX to $212 from $215.

As a result, 34 analysts surveyed by TipRanks have set an average 12-month price target for SpaceX at $231.11. As of press time, the highest price target for SPCX from these analysts was $800 while the lowest is $75.

SPCX stock forecast. Source: TipRanks SPCX price performance  Since its initial public offering (IPO), SPCX’s price has added over 9%., trading at $148.22 at the time of publication.

SPCX all-time chart. Source: Finbold Since this company reported its second quarter (Q2) of fiscal year 2026, on August 4, SPCX’s price has attempted to regain bullish sentiment, which Wlodarczak believes hinges on Starship’s reusability.

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SpaceX Gets a Bullish Call as Analyst Sees 49% Upside From Starship Summary

The analyst sees reusable Starship launches as a potential driver of growth across launch services, Starlink and AI infrastructure

SpaceX ( SPCX ) shares rose 1.5% Tuesday after Pivotal Research Group began coverage with a Buy rating and a $220 year-end 2027 target.

The target implies about 49% upside from the company's Sept. 4 closing price of $147.95. Analyst Jeffrey Wlodarczak based the view largely on whether Starship can achieve repeated flights with limited refurbishment and quick turnaround.

Pivotal expects that progress could reshape launch economics. The firm estimates reusable missions could cut launch expenses by more than 90%, creating room for Starlink expansion while supporting potential orbital computing operations.

The projections point to rapid growth. Revenue is expected to increase from $46.6 billion in 2026 to $118.2 billion in 2027, while adjusted EBITDA is forecast to reach $22.3 billion next year from $11.2 billion.

The valuation also carries substantial execution and funding risks. Pivotal estimates SpaceX could require about $1 trillion over the next decade. Starship delays, financing needs, competition and regulatory pressure could affect the outlook, while the $220 target assumes a 65% probability for the firm's base case.

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When most people hear Space Exploration Technologies (SPCX +3.73%), they probably picture a rocket blasting into space.

That's understandable. Rockets are how SpaceX became famous. But investors who think SpaceX is simply a rocket company are missing the bigger picture, since the company is increasingly becoming a collection of businesses that reinforce one another.

And I think investors should think about it in three layers.

Image source: Getty Images.

Starlink is the economic foundation The first layer is Starlink.

Starlink provides internet connectivity through a growing constellation of satellites orbiting Earth. Unlike Starship or some of SpaceX's more ambitious projects, it's no longer a promise about the future.

It's a real business with millions of paying customers. Starlink ended the second quarter with approximately 12 million subscribers, double the number from a year earlier. Connectivity revenue rose 66% to $4.3 billion, while operating income reached roughly $1.7 billion.

That's significant. Starlink is increasingly becoming the financial engine that allows SpaceX to pursue much larger opportunities.

And the market opportunity extends well beyond households. Starlink is expanding into aviation, maritime, enterprise, government, and mobile connectivity. Enterprise and government revenue grew 108% year over year in the latest quarter, accounting for 42% of total revenue.

If Starlink can continue to scale profitably, it will generate even more profits to fund SpaceX's other ambitious projects.

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Artificial intelligence (AI) could become the next massive growth engine The second layer is much newer: artificial intelligence (AI).

SpaceX's AI-related revenue jumped 247% year over year to $2.6 billion in the second quarter. The company is rapidly building computing infrastructure to serve demand for AI workloads.

That growth is remarkable. But here's where investors need to look beyond the headline. SpaceX spent approximately $15.8 billion on AI infrastructure during the quarter. That's roughly 6 times the segment's quarterly revenue.

So the important question isn't simply whether AI revenue is growing quickly. It's whether SpaceX can earn attractive returns on the enormous amount of capital it is investing. If it can, the opportunity could be huge.

SpaceX has already demonstrated that it can build infrastructure at a scale few companies can match. Its ability to combine that infrastructure with access to capital, engineering talent, and its own launch capabilities could give it an unusual competitive position.

Still, AI is the exciting new part of the SpaceX story, so it's not quite as proven a business as Starlink. Investors should closely monitor the development of this business and how it complements Starlink's existing offerings.

Rockets are the infrastructure This is the part of SpaceX that investors could easily misunderstand. The rocket business isn't necessarily the destination. It's the transportation infrastructure that allows the rest of the ecosystem to exist.

Think of it this way. Falcon 9 already gives SpaceX a highly successful launch platform. But the newer Starship is designed to change the economics of space much more dramatically.

Starship is SpaceX's next-generation reusable rocket system. The company intends for both the spacecraft and its booster to be rapidly reusable, while carrying substantially more payload than Falcon 9.

SpaceX believes Starship could eventually increase payload capacity dramatically and reduce launch costs by roughly an order of magnitude. If that happens, the implications go far beyond launching rockets.

SpaceX could deploy more Starlink satellites. It could build larger satellite networks. It could support more commercial and government missions. And it could potentially put large amounts of computing infrastructure into orbit.

That last possibility is particularly interesting.

SpaceX is already pursuing orbital AI infrastructure and has announced plans for a $100 billion Starbase Louisiana complex intended to support Starship and future AI satellite operations. That's a remarkable investment in infrastructure for something that doesn't yet exist at a meaningful commercial scale.

But it reveals how SpaceX thinks about the future. Starship isn't merely a bigger rocket. It could be the platform that makes SpaceX's next generation of businesses economically possible.

Putting the SpaceX flywheel together Put the pieces together, and the investment thesis for SpaceX becomes much more interesting.

Starlink generates recurring revenue and profits. Those profits can help fund new infrastructure like Starship. Starship could eventually make launches dramatically cheaper. Cheaper launches could allow SpaceX to deploy more satellites, more quickly. More satellites increase Starlink's capacity.

At the same time, growing demand for AI creates another enormous market for computing infrastructure. And if SpaceX can eventually deploy some of that infrastructure in space, it could open an entirely new market.

Each business potentially makes the others more valuable. And that's the SpaceX story.

In short, investors aren't simply buying rockets. They're buying a company attempting to control multiple layers of the infrastructure connecting Earth, satellites, communications, and computing.

Few companies on the planet are positioned to do that.

On June 12, Elon Musk's Space Exploration Technologies (SpaceX) (SPCX +3.73%) burst onto the scene with the largest initial public offering (IPO) in Wall Street's storied history. SpaceX priced its shares at $135, giving the company an initial valuation of $1.77 trillion, and raised a record $85.7 billion from its IPO, including the underwriters' overallotment.

Nearly three months later, SpaceX is set to make history yet again -- albeit the dubious kind.

Image source: Getty Images.

Insider selling activity at SpaceX is (likely) about to ramp upWhen private companies go public, they announce a lockup period that prevents their insiders, consisting of high-ranking executives, board members, and early investors, from selling shares shortly after the IPO and capitalizing on IPO/retail investor buzz. Commonly, insiders are prohibited from selling their shares for the first 180 calendar days after the IPO.

Space Exploration Technologies avoided convention throughout the IPO process, including its announced share unlock schedule. Although CEO Musk can't sell any shares until 366 calendar days after SpaceX's debut, early release-eligible insider shares are available for sale much earlier than the traditional 180 calendar days.

Great look at the SpaceX shares unlock schedule as well as the potential passive buying schedule from @JSeyff @FrancisSharoon Depending on the early post-IPO returns, this could really play with and disperse the returns of "passive" funds (which is why there's arguably no such… pic.twitter.com/KOuEkJlngF

— Eric Balchunas (@EricBalchunas) May 28, 2026 SpaceX's lengthy prospectus outlined a staggered and accelerated share unlock schedule that began two trading days after the company's first quarterly report as a public company on Aug. 4. As of Aug. 6, approximately 911.5 million insider shares were available for sale.

The company's prospectus also outlines several time-based milestones that allow early release-eligible insiders to cash out. These milestones occur on calendar days 70, 90, 105, 120, 135, and 180 after the IPO, respectively.

Today, Sept. 9, marks the 90-calendar-day milestone. Approximately 7% of early release-eligible insider shares (roughly 319 million shares) are eligible for sale today, representing up to $47.2 billion in potential insider selling pressure, based on SpaceX's closing share price of nearly $148 on Sept. 4.

Image source: Getty Images.

Although the prospect of insider selling is something all newly public companies eventually deal with, Space Exploration Technologies' situation is also unique with regard to its initial float (i.e., tradable shares).

When SpaceX priced its IPO, the company only sold roughly 555.6 million shares. While this might sound like a large number, it represents less than 5% of SpaceX's outstanding shares. Most private companies going public will sell between 10% and 25% of their outstanding shares.

Purposely keeping the number of tradable shares historically low provided an artificial boost to SpaceX's share price in the early going. Fast-track entry into the Nasdaq-100, Russell 1000, and Russell 3000 meant a significant chunk of these shares were gobbled up by passive funds.

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But with each successive share unlock event, SpaceX's float can quickly expand and let the proverbial air out of the company's sails.

These early release-eligible unlock events are also occurring amid steep losses for Musk's company. Although SpaceX has landed a handful of lucrative, multiyear artificial intelligence (AI) data center compute contracts since May, the company's AI and space infrastructure segments are burning through a lot of cash.

In other words, the puzzle pieces remain in place for SpaceX's insiders to effectively fleece retail investors.

AI companies continue to raise new capital to fund growth.

SpaceX (NASDAQ:SPCX) stock is up 4% so far in September, trading at $147.95 at press time, on September 7. With new SpaceX share unlocks now on the horizon, however, the price could potentially experience some volatility in the coming weeks.

Initially, about 639 million SPCX shares went into circulation following the June 12 initial public offering price (IPO), so the upcoming unlocks are set to significantly increase the stock’s tradable supply in a rather short period of time. 

Notably, the September 24 unlock will raise the tradable float to about 20.1%. To see how the price might move as a result, we asked OpenAI’s chatbot, ChatGPT, to predict SpaceX stock price after the September 24 share unlock.

ChatGPT says SpaceX stock will hit this price by September 24 The chatbot’s prediction for SpaceX stock after the September 24 share unlock was bearish. Specifically, it argued that SPCX shares would likely trade in the $140-$155 dollar range shortly after the event, with the single best estimate being around $145 dollars. This is roughly 2% below the last close at $147.95.

However, the algorithm left some room for a more bullish scenario. Namely, in case of strong demand, the stock could climb to somewhere between $155 and $170 dollars, while an exceptionally bullish outcome could take it to $175-$190, or higher.

ChatGPT predicts SpaceX stock price after September 24 SPCX share unlock. Source: Finbold and ChatGPT It is noteworthy that the machine learning algorithm punctuated the analysis by claiming that a major crash following the share unlock is not very likely, as not all shares are necessarily sold immediately. 

Furthermore, last month’s large unlocks likewise had no such effect on the prices, and investor enthusiasm around SpaceX’s artificial intelligence (AI), satellite, and computing businesses could provide substantial demand to offset any pressure.

Accordingly, if SpaceX is above $155-$160 dollars going into September 24, the chatbot expects the unlock to cause only a modest pullback, potentially toward $145-$150. 

Featured image via Shutterstock

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Space Exploration Technologies (SPCX -1.20%) stock has climbed 18% over the last month, bringing welcome news for shareholders. Over the stock's short trading history, it's already been a wild ride, with shares trading as low as $104.83.

SpaceX stock did a lot of work to get back above its initial public offering pricing of $135, and according to forecasts, that's just the start of where it could be heading by September 2027.

Image source: Getty Images.

What a $10,000 investment today could be worth by next year Based on the Sept. 4 closing price of $147.95, purchasing $10,000 worth of SpaceX stock would yield a little more than 67 shares through fractional investing.

For where analysts think the stock price could go next, of the 41 who cover the stock, the median price target over the next 12 months for SpaceX is $216, according to CNN. If SpaceX hit that price, that would turn a $10,000 investment at the Sept. 4 closing price of $147.95 into approximately $14,599.

For a broader range of scenarios, we can also estimate the potential value of a $10,000 investment in SpaceX by looking at the lowest price target. I won't go over the highest price target, $800, which seems more of a long-term possibility over the next several years than something feasible in the next 12 months.

The lowest price target from that group of analysts is $75. If the SpaceX stock price were to sink that low, that would turn a $10,000 investment into a loss of approximately $5,069.

There's no guarantee that SpaceX will reach any of those prices. Rather, price targets offer a mental model investors can use to gauge sentiment around the stock and develop a risk-to-reward framework to assess whether the stock is a potential portfolio fit.

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Investment considerations In the near term, SpaceX will remain unprofitable. While its 2026 second-quarter earnings report showed its net loss narrowed from $1 billion the year before to $541 million, it's still a loss.

That said, this still could be a stock worth considering adding to a portfolio for more aggressive investors. The upside potential with SpaceX lies in its ability to lead the charge in the next wave of artificial intelligence (AI) infrastructure, with SpaceX forecasting a $26.5 trillion total addressable market (TAM).

It's showing early signs of what it can do through its ground-based data centers, striking deals with both Alphabet and Anthropic to rent out compute capacity. Together, those two contracts could generate $26 billion in annual revenue for SpaceX. As a reference point, SpaceX generated $18.7 billion in revenue for all of 2025.

But that could just be an early preview of what to expect from its data-center deals, as SpaceX plans to launch over 1 million satellites to serve as orbital data centers, with launches expected to begin in 2028. Over time, if SpaceX executes on that AI infrastructure build-out and captures as much of that $26.5 trillion TAM as is possible, it could make the $800 price target mentioned earlier much more realistic to reach over the long term.

Space Exploration Technologies (SPCX -1.20%), commonly referred to as SpaceX, got an initial share price bounce when it IPO'd due to enthusiasm about what it might do over the years to come -- such as building orbital data centers. It's also an Elon Musk company, which draws a lot of interest. (Tesla has averaged annual gains of 39% over the past decade.)

You might be wondering whether you should buy shares yourself or just forget about it.

I myself am forgetting about it, but every investor is different, so it's worth learning more and making your own decision. Here are some considerations.

Image source: Getty Images.

Why you might buy SpaceX Here are reasons for buying:

Some Wall Street analysts are bullish on it. The stock recently traded around $150 per share (as of Sept. 3), and the average one-year price target from analysts is $222, roughly 48% higher. SpaceX is a leader in space launches, and its Starlink leads in satellite communications. Those are areas with plenty of growth potential. It also has an artificial intelligence (AI) platform. It's already growing. Its second quarter featured revenue up 92% year over year to $7.8 billion.

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Why you might forget SpaceX Those may be some compelling reasons to buy, but here are some reasons to pass on SpaceX:

While revenue is up, its bottom line is red, with a second-quarter net loss of $541 million. (That's an improvement from the year-earlier loss of $1 billion.) Its valuation is steep. There are no earnings, so there's no price-to-earnings (P/E) ratio. But the price-to-sales ratio is a steep 65, and the forward-looking P/E ratio was recently 194. There's no margin of safety here. If the company fumbles, the stock could fall sharply. More than a billion early investors' shares will be "unlocked" in September and October, allowing them to be sold -- which could send shares downward. Think it through for yourself and do some more research. I'm steering clear based on what I'm seeing.

Selena Maranjian has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.

Two months ago, Elon Musk made a bold claim. (I know. Shocking!) Explaining in its initial public offering (IPO) prospectus why Space Exploration Technologies (SPCX -1.20%) was justified in asking investors for a valuation more than $1.5 trillion, Musk & Co. asserted that, in the not-too-distant future, its products and services would serve a $28.5 trillion market for space, connectivity, and artificial intelligence (AI) services.

And the biggest of these was AI.

According to Musk, AI is a market opportunity of $26.5 trillion.

Image source: Getty Images.

SpaceX argues, Anthropic echoes Such a gargantuan number obviously stuck with me. And when another AI company -- Anthropic -- announced last week that, in its opinion, the total addressable market (TAM) for AI services could reach $30 trillion, well, that rang a big bell.

Anthropic reported $11.6 billion in revenue in the second quarter (Q2) of 2026, more than doubling year over year. According to The Wall Street Journal, the company earned a "small operating profit" as well. But Anthropic sees even bigger things ahead for it as its TAM swells to $30 trillion and beyond.

So, $26.5 trillion? $30 trillion? These are big numbers, and they're suspiciously close to each other. But that's not the only thing they have in common. Anthropic says it's targeting a TAM comprising "the full scope of work that could be completed with AI models," according to the Journal. And it can reach this TAM if it can "theoretically capture ... 100% market-share."

Emphasis on "theoretically."

But here's the problem: Estimating the size of a company's TAM requires "a bit of guesswork," says the Journal. Rarely does the company approaching an IPO tell you exactly what it includes in its TAM. Even more rarely does it tell you when it expects to achieve the TAM it cites.

Unlike actual market-share reports, says the Journal, TAM estimates are "especially squishy."

Which is another way of saying it's impossible to verify them before the IPO has happened -- by which time it may be too late.

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Examples from history Need examples? In 2019, ride-share company Uber (UBER -0.26%) told investors that its TAM was $6 trillion. But how much revenue did Uber actually pull in last year? $52 billion. Or about nine-tenths of one percent of what it cited as its TAM.

In 2021, Rivian Automotive (RIVN -1.07%) claimed its TAM was $9 trillion. Last year, Rivian booked less than $5.4 billion in revenue -- less than one-tenth of one percent of the claimed TAM.

In 2023, Instacart (CART -1.26%) targeted a $1.1 trillion TAM in groceries. Amazingly, Instacart was the most accurate of these three companies. Its revenue in 2025 was $3.7 billion, or about 3.4% of its TAM estimate.

What's the upshot for investors? What lesson should investors draw from the above?

Not that TAM is necessarily complete bunk. I suppose if you look out far enough, a TAM in just about anything can grow into any number you like; it just may take a few decades, or centuries, for that to happen. If a company wants to hypothesize a bright future far in the distance and not pin a precise date to it, then, technically, I suppose there's no reason they shouldn't be allowed to do that.

Your job, however, is to realize that when a company like Uber, Rivian, Instacart -- or SpaceX and Anthropic -- gives you a TAM, it's more of a marketing ploy than a realistic prediction of the near future.

You should also be aware that two things can be true at once. SpaceX and Anthropic may both estimate the AI economy will grow to $30 trillion eventually. They may even be right! But if SpaceX and Anthropic are both targeting this same $30 trillion AI market, neither one of them is going to own all 100% of it. It's much more likely that SpaceX will claim one sliver of the market, Anthropic another -- with rivals such as OpenAI, Microsoft, Meta (META +1.00%), and DeepSeek all claiming their pieces of the pie as well.

Ultimately, no matter how big the TAM, every one of these companies is going to have to share with the others, and no one of them is going to get anywhere near the full $30 trillion. Caveat investor.

Investors who bought SpaceX (NASDAQ: SPCX) stock during the August recovery rally have yet to fully recover their losses despite a strong rebound over the past month.

This is evident in the performance of a $10,000 investment made on July 6, 2026. With SpaceX shares trading at $160 at the time, the investment would have purchased 62.5 shares. 

At the current price of about $147, that stake is worth approximately $9,188, representing a loss of roughly 8%.

SpaceX stock price chart. Source: Finbold Notably, SpaceX has experienced sharp swings since its June 2026 initial public offering. After debuting at $135 per share, the stock surged above $225 during its first weeks of trading as investor enthusiasm pushed the company’s valuation beyond $2 trillion.

The rally proved short-lived as shares retreated throughout July and eventually fell to a post-IPO low near $105 in early August. Since then, buyers have returned, helping the stock recover into the mid-$140 range.

While the rebound has been significant, the stock remains below both its July trading level and its post-IPO peak.

The sell-off was driven by concerns over elevated valuation levels, heavy spending on artificial intelligence infrastructure, and insider selling pressure following lock-up expirations.

SpaceX positive fundamentals  Investor sentiment improved after the company reported strong second-quarter results. Revenue climbed 92% year-over-year to $7.8 billion, while adjusted EBITDA jumped 191% to $3.5 billion.

Starlink remained a key growth driver, with subscribers reaching 12 million and SpaceX securing more than $6 billion in new Starshield government contracts during the quarter.

The company’s artificial intelligence segment is also gaining traction. AI solutions and infrastructure revenue reached approximately $2.7 billion in the second quarter, reinforcing investor interest in SpaceX’s long-term compute ambitions.

Meanwhile, a key near-term catalyst is Starship Flight 14, expected as early as mid-September. The mission could mark the program’s first orbital deployment of operational Starlink V3 satellites, a milestone closely watched by investors.

At the same time, markets are monitoring upcoming post-IPO lock-up expirations, which could release hundreds of millions of additional shares for trading and create short-term selling pressure.

Featured image via Shutterstock

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The race to provide global satellite connectivity is heating up as space-based networks move from concept to commercial reality. Choosing between AST SpaceMobile (ASTS +0.29%) and Space Exploration Technologies (SPCX -1.20%) requires weighing infrastructure versus integration.

AST SpaceMobile focuses on connecting standard smartphones directly to its satellite constellation without special hardware. In contrast, Space Exploration Technologies, known on the street as SpaceX, leverages its own reusable rockets to deploy the massive Starlink broadband network. While both target the frontier of global communication, their business models and financial scales differ significantly for investors.

The case for AST SpaceMobileAST SpaceMobile competes among communication stocks by partnering with global mobile network operators to provide satellite-based services. Its primary strategy involves using a proprietary satellite constellation to provide connectivity to standard smartphones without hardware modifications. According to its latest annual report, filed for FY 2025, the company has secured agreements with over 50 partners, including AT&T Inc (T -1.95%) and American Tower Corp (AMT -1.07%). Customer concentration like this adds a layer of risk to the business.

In FY 2025, revenue reached approximately $70.9 million, a substantial jump from the $4.4 million reported in the prior fiscal year. The company reported a net loss of nearly $342 million for the period. While revenue growth is accelerating as the company begins its commercial rollout, profitability remains a distant goal during this build-out phase.This resulted in a net margin of negative 482%, illustrating the high costs associated with launching a satellite constellation before reaching full operational scale.

The current debt-to-equity ratio is roughly 1.2x, showing the company relies more on debt than equity to fund its operations. Based on the December 2025 balance sheet, the so-called current ratio is roughly 16.4x. This indicates a high level of liquid assets relative to near-term liabilities. Free cash flow, which is cash flow from operations minus capital expenditures, was more than negative $1.1 billion for FY 2025, as the firm invested heavily in its proprietary manufacturing and launch capabilities.

The case for SpaceXSpace Exploration Technologies operates a vertically integrated business that designs, manufactures, and launches its own rockets and satellites. The company generates revenue through its Starlink broadband service, which serves millions of subscribers across the consumer, enterprise, and government markets. It currently serves customers in 164 countries and territories, utilizing its proprietary launch capabilities to expand its orbital constellation.

In FY 2025, revenue reached nearly $18.7 billion, which is a growth of roughly 33% over the previous fiscal year. The company reported a net loss of close to $4.9 billion, resulting in a net margin of roughly negative 26%. This loss follows a profitable year in 2024, highlighting the variable nature of heavy capital investment in the aerospace sector.

As of its December 2025 balance sheet, the current ratio is approximately 1.4x. The debt-to-equity ratio is nearly 0.6x, indicating that the company uses less debt relative to equity compared to its peer. Free cash flow was approximately negative $14 billion, and stock-based compensation (SBC) represented roughly 29% of operating cash flow, which inflates reported cash generation since SBC is a non-cash expense added back in the cash flow statement.

Risk profile comparisonAST SpaceMobile faces significant risks regarding its financial viability and ongoing capital requirements. The company has a history of losses and has not yet generated revenue from its core SpaceMobile Service, leading to potential shareholder dilution if more funding is needed. Operational execution is also critical, as the service depends on the successful launch and performance of a complex satellite constellation. Furthermore, the company faces intense competition from established providers like Starlink.

Space Exploration Technologies operates in the high-risk aerospace industry, where launch failures or technical setbacks can cause significant financial and reputational damage. The company is subject to intense regulatory scrutiny and must maintain a high cadence of successful launches to sustain its Starlink expansion. Competition is also a factor, as the company faces pressure from other satellite providers such as Iridium Communications (IRDM +0.55%) and Viasat Inc (VSAT +5.02%).

Valuation comparisonSpace Exploration Technologies appears more reasonably priced based on its P/S ratio and Forward P/E relative to its larger revenue base.

MetricAST SpaceMobileSpace Exploration TechnologiesForward P/En/a196xP/S ratio153x66xValuation metrics sourced from Financial Modeling Prep (FMP) and may differ from other data providers.

SpaceX's various businesses intend to leverage the company's core launch capabilities, starting with reusable rockets. The ability to reuse boosters significantly lowers per-launch costs and spreads fixed manufacturing costs across multiple missions. Expectations are that scaling up quickly will happen, with Wall Street analysts projecting $39 billion in sales for fiscal 2026, a much lower net loss of around $1.6 billion, and profitability in 2027.

The lack of free cash flow appears to be crushing; projections indicate free cash flow will be negative $28 billion this year, then jump to negative $67 billion in 2027.

Still, the success of Tesla Inc (TSLA -5.92%) has made founder Elon Musk the richest man in the world and raised expectations that he can make an even greater fortune from SpaceX. The business certainly has market support behind it, raising the world's largest IPO, $85.7 billion this year.

SpaceX has a very real business in Starlink, which mitigates the possibility that grander plans won't come to fruition.

AST SpaceMobile expects its space-based network to give it a significant business in a few years. Essentially, AST SpaceMobile is a direct-to-device play to provide full mobile phone compatibility for major carriers without the need for specialized equipment. Many of its potential clients are also equity holders in the company, including AT&T, Verizon Communications (VZ -0.89%), Bell Canada, Rakuten, Vodafone (VOD +1.93%), Alphabet Inc (GOOGL -1.11%), American Tower, and Telus (TU -0.72%).

By the end of 2026, the company should have 45 satellites, which will allow it to fully service the U.S., and that should start to supercharge revenue growth. For fiscal 2026, Wall Street sees $149 million in sales, jumping to $725 million the following year, when the company is projected to turn its first modest profit. Free cash flow appears much more manageable, with analysts expecting positive free cash flow in 2029.

In choosing between the two, the major telecom businesses backing AST SpaceMobile lend confidence that the company's plans will pan out over the long term. Meanwhile, SpaceX's mission appears muddled: is it a telecom provider, a space cargo business, or a Mars colonization outfit?

The better bet for 2026 is AST SpaceMobile.

Space Exploration Technologies (SPCX -0.40%) has given investors plenty to get excited about this year. The company's IPO was all the rage this summer, as tech pundits and analysts weighed its impact on the market. But for retail investors, SpaceX has a problem that has little to do with rockets: Its various stakeholders can't sell most of the shares they own -- yet.

When companies go public, their pre-IPO stakeholders -- employees, executives, and other early investors -- can't start selling their shares immediately. Lockup periods are put in place to prevent too many shares from flooding the market in too short a time frame. SpaceX laid out a staggered schedule for the release of those shares over the next year, and the next release date falls on Sept. 9. 

Image source: Getty Images.

As of that day, those early shareholders will be able to sell another 319 million shares. That does not mean every shareholder will sell their newly eligible shares. But it does create a potential technical headwind for a stock that entered the public market with a small effective float. SpaceX's own filing also registered shares held by current and former employees for potential resale, meaning investors have to think about supply as well as demand.

That is one reason I'd rather look for opportunities elsewhere in the space and technology markets today. Three companies stand out because their growth stories are tied to infrastructure that still has to be built.

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1. Rocket Lab is building the other end of the launch market Rocket Lab (RKLB +0.72%) is not trying to replicate SpaceX one-for-one. Its smaller-payload Electron rocket has given the company launch experience, while its larger Neutron vehicle addresses the medium-lift market. Rocket Lab has said Neutron is intended to support constellation deployments, and it already has dedicated launches booked.

The technical opportunity for the company is bigger than selling launches. Rocket Lab is building itself into an end-to-end space company, with launch vehicles, spacecraft, and components under one roof. That vertical integration can matter because satellite operators don't just need a ride to orbit. They need spacecraft, propulsion, power systems, and the ability to replace aging satellites or expand satellite constellations over time.

Neutron is also the major swing factor. Developing a reusable medium-lift rocket is expensive and carries execution risk, but success could earn Rocket Lab an additional layer of recurring launch demand from commercial and government clients.

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2. AST SpaceMobile is attacking a different bottleneck AST SpaceMobile (ASTS +0.64%) is taking another approach to the space economy. Instead of selling launches, it is trying to integrate satellites into terrestrial cellular networks.

Its next-generation BlueBird satellites have phased arrays measuring almost 2,400 square feet and are designed to connect directly with ordinary smartphones. The company's architecture uses its proprietary AST5000 chip, which provides up to 10 gigahertz of processing bandwidth per satellite.

What caught my attention is the pace of the company's build-out. AST SpaceMobile launched BlueBirds 8 through 10 in June and BlueBirds 11 through 13 in August. The company says its production system is designed to build six satellites per month and expects to have about 45 in orbit by early next year.

This is still a capital-intensive bet with real technical and regulatory risks. But each successful satellite deployment moves the company closer to a being continuously available network in its chosen markets rather than another technology demonstration.

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3. Redwire is selling the infrastructure behind the infrastructure Redwire (RDW +2.75%) may be the least obvious name here, but that is what makes it interesting.

The company is developing systems that provide power, manufacturing, and other infrastructure for spacecraft. Its new ELSA solar array is designed for mass-produced satellites and can deliver up to 50% more power per unit volume than traditional arrays. Redwire has also won contracts tied to national security satellites and commercial space infrastructure.

SpaceX gets attention because everyone can understand a rocket launch. The less glamorous opportunity may be the companies supplying key components and hardware for satellite constellations.

None of these three companies is as proven as SpaceX. That is the trade-off. Rocket Lab still has to complete its first Neutron launch, AST SpaceMobile has to grow its satellite constellation into a viable communications network, and Redwire has to execute across a growing set of space and defense programs.

Space Exploration Technologies (SPCX +6.42%) spent $18.4 billion on capital projects in the second quarter. Given the company's name, you might expect the lion's share of that to have gone toward rockets, satellites, and the like. You'd be wrong.

$15.8 billion -- about 86% -- went to its artificial intelligence (AI) segment, SpaceXAI.

The rest was basically a rounding error by comparison: SpaceX put $1.4 billion into Starlink, its satellite-based internet business, and $1.2 billion into its Space business -- that is, rockets. Here's the full breakdown:

SegmentQ2 2026 capexShare of totalAI (SpaceXAI)$15.8 billion86%Starlink$1.4 billion8%Space (rockets)$1.2 billion7% SpaceXAI's compute capacity hit 1.4 gigawatts in Q2 2026 as revenue nearly tripled The bulk of those AI dollars went toward compute infrastructure -- the data centers, specialized chips, networking equipment, and power and cooling systems needed to train and run AI models. SpaceXAI increased its compute capacity from 1 gigawatt (GW) in the first quarter to 1.4 GWs in the second quarter. That's roughly enough energy to power more than 1 million homes.

An AI data center. Image source: Getty Images.

SpaceX's capacity is highly valuable at the moment. The company began servicing a contract to supply Anthropic, the creator of Claude, with compute that will eventually generate $1.25 billion per month once all the chips are up and running. The segment's revenue jumped quarter over quarter from $818 million to $2.56 billion.

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Meta, Amazon, Microsoft, and Alphabet spent $303 billion on AI capex in H1 2026 SpaceX is far from alone in spending incredible amounts on AI infrastructure. According to Motley Fool Research, four of the largest hyperscalers -- Meta, Amazon, Microsoft, and Alphabet -- have already spent $302.8 billion in just the first half of 2026.

It's a big bet that needs an equally big payoff. I'm not convinced it will work out long-term, but for anyone considering SpaceX stock, the $15.8 billion shows that while the company may be known for rockets and Starlink, its financial future depends heavily on AI.

Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, and Microsoft. The Motley Fool has a disclosure policy.

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Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in SPCX over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

When recently IPO'd Space Exploration Technologies (SPCX +6.42%), or SpaceX, released its first quarterly earnings report, there wasn't much in it that was unexpected.

Revenue grew. Net loss shrank. Capital expenditures in the AI business skyrocketed. Ho hum. But buried in the report were a pair of numbers that made me do a double-take. I had to check to make sure I read them correctly.

These two numbers could actually be a game changer for SpaceX's profitability. Here's what they are and why they're important.

Image source: Getty Images.

Buried on page 5 SpaceX highlighted its biggest, boldest numbers on page 1 of its report, boasting about its $14.1 billion in contracted Cloud Services Agreements sales, and its $6 billion in multi-year government Starshield contracts.

But on page 5 -- literally halfway through the 10-page report -- these two numbers caught my eye: 12.0 and $66.

12.0 is the number of subscribers, in millions, for SpaceX's Starlink satellite broadband and wireless network, which offers communications access to people around the globe who aren't served by traditional cellular towers or internet cable networks.

That's actually a sizable 16.5% jump from the 10.3 million Starlink subscribers that SpaceX reported in the first quarter, and it's double the 6 million Starlink subscribers that SpaceX reported in the second quarter of 2025.

The other number -- $66 -- is where it really gets interesting.

Image source: The Motley Fool.

Holding steady $66 is the monthly average revenue per user (ARPU) of those 12 million Starlink subscribers. That's unchanged from Q1 ... which is a big surprise.

In Q2 2025, Starlink's monthly ARPU was $85 for its 6 million subscribers. When that shrank to $66 for 10.3 million subscribers in Q1, most analysts assumed that Starlink's ARPU would continue steadily shrinking as it expanded into less profitable markets, likely at a similar rate. Instead, Starlink was able to add 1.7 million net new subscribers without margin shrinkage. That's huge.

Starlink is currently SpaceX's only profitable segment, and it's essentially offsetting all the losses from the rocket launch segment and some of the losses from the AI segment. However, if Starlink can continue to grow its subscriber base while mostly maintaining its current ARPU, the company could become profitable much earlier than most analysts -- including me -- anticipated.

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That said, one quarter doesn't make a trend. It's always a good idea to wait for multiple quarterly reports before buying shares of a recent IPO.

It's possible this quarter is just a blip, and Starlink's ARPU will continue to shrink in the third quarter. Or SpaceX's AI losses might accelerate faster than anticipated. With just one official quarterly report to go on, there's no way to tell.

But if this trend continues in Q3, I might have to rethink my conclusion that SpaceX is wildly overvalued.

It has been about a month since the last earnings report for SpaceX (SPCX - Free Report) . Shares have added about 30% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is SpaceX due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

SpaceX Beats Q2 Earnings Estimates on AI Cloud and Starlink Growth

SpaceX reported a loss of 9 cents per share for the second quarter of 2026, 73.5% narrower year over year. The bottom line beat the Zacks Consensus Estimate of a 26-cent loss by 65.4%.

Revenue surged 91.9% to $7.81 billion and topped the $6.72 billion consensus by 16.3%, led by AI cloud services and Starlink expansion. Starlink subscribers doubled to 12 million, while nameplate compute reached 1.4 gigawatts.

SPCX Growth Broadens Across Segments

All three operating segments posted year-over-year revenue gains. Connectivity remained the largest contributor, while AI recorded the fastest growth and Space benefited from a more favorable customer launch mix.

The revenue mix also shifted toward newer infrastructure services. AI generated nearly one-third of quarterly sales, supported by the initial ramp of cloud agreements. Recurring connectivity operations remained the company’s only segment-level source of operating income.

Connectivity Delivers Operating Leverage

Connectivity revenues climbed 65.8% year over year to $4.29 billion. Consumer revenues increased 44.4% to $2.49 billion, while Enterprise & Government revenues more than doubled to $1.81 billion on aviation wins and U.S. government demand.

The segment’s operating income rose 79.4% to $1.66 billion, lifting operating margin about 3 percentage points to 38.6%. Adjusted EBITDA soared 64.1% to $2.60 billion. Average revenue per user was $66, unchanged sequentially and down from $85 a year earlier. Management expects geographic expansion may pressure blended ARPU over time.

AI Cloud Deals Lift Profitability

AI revenues jumped 247.5% year over year and 213.1% sequentially to $2.56 billion. New cloud services agreements contributed $1.60 billion of incremental infrastructure revenue, while total contracted cloud sales reached $14.10 billion. Compute capacity increased from 1.0 gigawatt in the first quarter and 0.4 gigawatt a year earlier.

The segment posted adjusted EBITDA of $1.15 billion, reversing from a $276 million loss a year ago. Its operating loss narrowed 49.1% sequentially to $1.26 billion. The filings also noted customer concentration in AI revenues and said cloud agreements generally can be terminated on 90 days’ notice after initial ramp periods.

Starship Spending Pressures Space

Space revenues increased 29.0% year over year and 55.4% sequentially to $962 million. The company completed 10 customer launches and 28 internal launches during the quarter, carrying 485 metric tons to orbit. First-half activity totaled 78 launches and 1,041 metric tons.

Higher Starship research and development spending kept the segment in the red. Space recorded an operating loss of $542 million and an adjusted EBITDA loss of $205 million. Management said Flight 13 met all objectives after quarter-end, supporting plans to deploy operational V3 Starlink satellites on upcoming Starship missions.

Capex Surge Reshapes Cash Deployment

Total costs and expenses rose 57.8% to $7.96 billion. Research and development spending increased 81.2% to $3.55 billion, reflecting investments across Starship, next-generation satellites and AI infrastructure. Still, the company reduced its consolidated operating loss to $143 million from $970 million and generated adjusted EBITDA of $3.54 billion.

Capital expenditures reached $18.37 billion, including $15.83 billion for AI. Six-month operating cash flow improved to $3.47 billion, but investing activities used $34.49 billion. Following $85.68 billion of IPO proceeds and a $25 billion bond offering, cash and marketable securities were $100.01 billion, with backlog at $47.46 billion.

SpaceX Sets Ambitious Year-End Targets

Management expects capital spending in each of the next two quarters to remain near the second-quarter level. The company targets more than 2 gigawatts of compute by year-end, with newly contracted cloud services worth $6.70 billion beginning to ramp in October over a six-month period.

SpaceX believes growth across cloud services, Cursor and its other businesses can support at least $100 billion in annualized revenue run rate by December. Management also expects V3 satellites to deliver a major capacity increase, while next-generation Starlink Mobile service is targeted to begin by the end of 2027.

How Have Estimates Been Moving Since Then?In the past month, investors have witnessed a upward trend in estimates revision.

The consensus estimate has shifted 129.53% due to these changes.

VGM ScoresAt this time, SpaceX has a subpar Growth Score of D, however its Momentum Score is doing a bit better with a C. However, the stock has a grade of F on the value side, putting it in the bottom 20% quintile for value investors.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

OutlookEstimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise SpaceX has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.

Performance of an Industry PlayerSpaceX belongs to the Zacks Wireless National industry. Another stock from the same industry, AT&T (T - Free Report) , has gained 12.5% over the past month. More than a month has passed since the company reported results for the quarter ended June 2026.

AT&T reported revenues of $31.56 billion in the last reported quarter, representing a year-over-year change of +2.3%. EPS of $0.65 for the same period compares with $0.54 a year ago.

For the current quarter, AT&T is expected to post earnings of $0.62 per share, indicating a change of +14.8% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.

AT&T has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of B.

Key Takeaways The global space economy reached $686 billion in 2025, with commercial activity driving most of the growth.Space ETFs like ARKX can cushion financial setbacks by diversifying across the broader space value chain.The global space economy may surpass $1 trillion by 2032, with commercial activity likely to remain dominant. The investment landscape for the space industry has fundamentally reshaped this year, driven by a watershed moment: the landmark initial public offering (IPO) of SpaceX (SPCX - Free Report) . This particular listing broadened investor interest far beyond traditional space-focused funds, reinforcing the industry's emergence as a legitimate asset class and attracting investors with limited or no prior space exposure.

As per a report published by Reuters in July 2026, space companies raised about $7.5 billion across 141 venture funding deals in the second quarter, compared with a record $8 billion across 159 deals in the first quarter.

This rising investment trend raises a crucial question for investors: What growth opportunities lie ahead for the space industry, and is it the right time to invest?

This guide explores the compelling growth opportunities within the global space industry and examines why the current environment may present a favorable entry point for investors. Finally, we highlight several exchange-traded funds (ETFs) that offer diversified exposure to the broader space economy.

Growth Opportunities in the Global Space IndustryThe global space economy, in particular the commercial sector, has rapidly evolved from a speculative frontier into a high-growth industry over the past couple of years. 

The numbers paint a picture of a robust and expanding market. In 2025, the global space economy reached a record $686 billion, up 12% from the previous year, with commercial activity accounting for the vast majority, or roughly 79%, according to a report from the Space Foundation.

With the growing dominance of private-sector investment in commercial space activities, backed by plummeting launch costs, several commercial players are competing nowadays to grab more space assets. 

The industry is also benefiting from the shift from government-led initiatives to a revenue-driven model. Companies are monetizing outcomes such as satellite connectivity, Earth observation data, and in-space services rather than simply selling hardware, thereby generating more predictable recurring revenue streams.

Structural demand for space rockets and components continues to rise, driven by government procurement reforms and national sovereignty needs amid growing geopolitical tensions worldwide.

The industry outlook remains bullish, with the Space Foundation projecting that the global space economy could surpass $1 trillion as soon as 2032, with the commercial sector once again expected to account for the majority of the total.

Why This May Be a Good Time to Invest in Space ETFsWhile the long-term growth story is compelling, the industry faces significant risks that could weigh on individual stock investments. 

The space industry is inherently capital-intensive, requiring massive upfront investments in research, development and infrastructure before generating any returns. Launch delays, technical failures, and cost overruns are common, with several high-profile setbacks in 2026 highlighting the risks and undermining investor confidence in affected companies. 

Regulatory complexities around spectrum allocation, orbital debris and national security concerns add another layer of uncertainty. Many space companies remain unprofitable, with their valuations driven more by growth prospects than current earnings, making them particularly susceptible to shifts in market sentiment and interest rates.

These industry-specific challenges underscore why space ETFs represent a prudent choice for most investors seeking exposure to this transformative sector. 

By providing a diversified basket of companies across the space value chain, from launch providers and satellite manufacturers to ground equipment suppliers and data analytics firms, ETFs mitigate the idiosyncratic risks that plague individual stocks. This diversification cushions the impact of any single company's technical failure or financial setback.

Space ETFs to ConsiderConsidering the aforementioned discussion, investors seeking to capitalize on the long-term growth opportunities offered by the global space economy may consider adding the following ETFs to their watchlists and investing in them if appropriate:

Tema Space Innovators ETF (NASA - Free Report)

This fund, with assets under management (AUM) worth $1.04 billion, offers exposure to 37 companies involved in space exploration, rockets and propulsion systems, and satellite technology, among other commercial opportunities. SPCX holds the first spot in this fund with 24.34% weightage, while Rocket Lab (RKLB - Free Report) holds the second spot with 9.73% weightage. 

NASA charges 75 basis points (bps) in fees and traded at a good volume of 1.07 million shares in the last trading session. 

ARK Space & Defense Innovation ETF (ARKX - Free Report)

This fund, with net assets worth $759.5 million, offers exposure to companies that are engaged in space exploration and defense innovation. SPCX holds the first spot in this fund with 10.12% weightage, while L3Harris Technologies holds the second spot with 6.82% weightage. 

ARKX charges 75 bps in fees and traded at a volume of 0.28 million shares in the last trading session. 

Procure Space ETF (UFO - Free Report)

This fund, with net assets worth $551.8 million, offers exposure to companies engaged in space-related industries. Trimble Inc. holds the first spot in this fund with 6.72% weightage, while Garmin Ltd holds the second spot with 6.65% weightage. 

UFO charges 75 bps in fees and traded at a volume of 0.23 million shares in the last trading session. 

VanEck Space ETF (WARP - Free Report)

This fund, with net assets worth $35.3 million, offers exposure to 23 companies involved in the space industry. SPCX holds the first spot in this fund with 22.73% weightage, while RKLB holds the second spot with 10.71% weightage. 

WARP charges 50 bps in fees and traded at a volume of 0.02 million shares in the last trading session.

After years of waiting, investors finally gained the opportunity to buy stock in Space Exploration Technologies (SPCX -1.07%) after the company held its initial public offering (IPO) in June. Shares of SpaceX rocketed higher after their debut on public markets, closing 19.6% higher on their second day of trading after closing at $160.95 on the day of the IPO.

But how have those who bought shares at the IPO fared since SpaceX stock launched on June 12? Are they heading to the stars or falling back to Earth?

Image source: Getty Images.

Enthusiasm fueled early gains for SpaceX stock With much fanfare, SpaceX stock opened on its first day of trading at $150 and soared to $176.52, eventually closing at $160.95.

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The upward momentum in SpaceX stock continued. Shares closed at $192.50 and then $201.80 on their second and third market sessions, respectively.

Bears quickly emerged, though.

In late June, investors balked upon learning that the company planned to offer a $25 billion bond, a considerable capital raise shortly after a successful IPO. Plus, several analysts offered uninspiring takes on SpaceX stock, countering the market's initial exuberance. On June 22, for example, KeyBanc initiated coverage of SpaceX stock with a neutral rating, and the next day, Susquehanna initiated coverage with a neutral rating and a $170 price target.

Investors also took exception to the company's second-quarter 2026 financial results presentation on Aug. 4, when SpaceX reported massive investments worth $15.8 billion in artificial intelligence (AI) infrastructure during the quarter.

SpaceX stock has failed to gain altitude For those who hitched a ride with a SpaceX investment at the time of the company's IPO, the returns have hardly been out of this world. Those who bought $500 of SpaceX stock at the time of its IPO on June 12, 2026, have seen their positions sink to $479 as of the close of trading on Aug. 31, 2026.

Is there potential for SpaceX stock to reverse its downward trajectory? While anticipation for the SpaceX IPO had been sky-high, shares have failed to attract the bulls. But looking at SpaceX's poor performance and concluding that the space stock isn't worthy of consideration would be grossly unwise. IPO stocks -- whether those of the Elon Musk variety or otherwise -- tend to exhibit significant volatility shortly after they debut on public markets -- a dynamic that leads many investors to eschew them completely.

Fortunately for those eager to gain exposure to SpaceX yet uninterested in the potential volatility of a stock purchase, there are several exchange-traded funds (ETFs) that hold SpaceX stock.

Social platform X is moving U.S. creator payouts to its own payments service, X Money, as it expands the role of its financial products within the platform. Starting Wednesday (Sep.

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SPCX buy-the-dip puts

Buy put protection on SpaceX (SPCX) into the unlock dates. The thesis is not just “down”—it’s timing: lockup expirations and insider selling typically create step-down moves, and the technical pattern suggests a breakdown could accelerate into the $104 area. Puts let you profit if the stock drops on those specific dates without needing a perfect entry.

Key Risk: The stock grinds higher on strong AI demand headlines, making puts lose value from time decay and implied volatility compression.

SPCX short

Sell/short SpaceX (SPCX). The chart is flashing a bearish setup: ADX has fallen to ~14.5 (trend losing strength), a rising wedge is forming (often breaks down), and PPO shows bearish divergence. With huge upcoming unlocks (319M shares Sept 9 plus more) and likely insider selling, the path of least resistance is toward the prior low near $104.

Key Risk: A sharp catalyst (major launch success or a big contract/financing win) that flips momentum and squeezes shorts before the unlock wave hits.

SpaceX stock has rebounded in the past few weeks, moving from the year-to-date low of $104 to the current $142. This rebound, however, is losing momentum, and the stock faces some major risks that may affect its performance in the coming months.

One of the top risks facing SPCX stock is its technicals. The four-hour chart shows that it has lost momentum in the past few days, with the Average Directional Index (ADX) dropping to 14.5 from the August high of 30.7. In most cases, a falling ADX is a sign that an asset is losing momentum.

At the same time, there are signs that the stock has formed a rising wedge pattern, which is made up of two ascending and converging trendlines. This pattern often leads to a bearish breakout. 

The Percentage Price Oscillator (PPO) has formed a bearish divergence pattern, which happens when an oscillator is falling as an asset is in an uptrend. Therefore, there is a risk that the stock will have a bearish breakout, potentially to the year-to-date low of $104. 

SPCX stock chart | Source: TradingView

Another big risk facing SpaceX stock is that millions of shares are expected to come online in the coming months. 319 million shares will unlock on September 9 followed by 59 million a day later. In total, over 2.62 billion shares will unlock this year, and many more will come next year.

A lockup expiration often weighs on a company's stock because it increases the number of shares available for trading. It also tends to trigger insider selling, which can add further pressure on the price.

READ MORE: SpaceX stock gains as Bernstein maintains bullish outlook

Free cash flow to remain under pressureSpaceX stock is also facing substantial risk as its free cash flow comes under pressure because of its spending. Its recent results showed that its space business had over $1.17 billion in capital expenditure, up slightly from the $1.05 billion it spent in the second quarter of last year.

The AI segment spent over $15.8 billion in capital expenditure, up from $7.7 billion in the same quarter last year. It spent $23 billion in the first six months of the year as it continued its data center rollout. 

This spending will likely continue as the company seeks to compete with companies like CoreWeave, Nebius, and Meta Platforms. Also, the segment is seeing some substantial delays that are affecting its business, which has pushed it to replace some of its leaders.

On the positive side, this business is seeing strong demand from companies like Anthropic and Google. 

Another risk is that Grok, its AI chatbot is losing market share to companies like OpenAI and Anthropic. A recent report showed that the two models have the biggest share in the United States. Grok and other models are also facing substantial competition from Chinese platforms like Kimi and DeepSeek. 

Additionally, there are signs that the company is highly overvalued, with its market capitalization approaching $1.95 trillion.

Key Takeaways The global space economy reached $686 billion in 2025, with commercial activity driving most of the growth. Space ETFs like ARKX can cushion financial setbacks by diversifying across the broader space value chain. The global space economy may surpass $1 trillion by 2032, with commercial activity likely to remain dominant. The investment landscape for the space industry has fundamentally reshaped this year, driven by a watershed moment: the landmark initial public offering (IPO) of SpaceX (SPCX - Free Report) . This particular listing broadened investor interest far beyond traditional space-focused funds, reinforcing the industry's emergence as a legitimate asset class and attracting investors with limited or no prior space exposure.

As per a report published by Reuters in July 2026, space companies raised about $7.5 billion across 141 venture funding deals in the second quarter compared with a record $8 billion across 159 deals in the first quarter.

This rising investment trend raises a crucial question for investors: What growth opportunities lie ahead for the space industry, and is it the right time to invest?

This guide explores the compelling growth opportunities within the global space industry and examines why the current environment may present a favorable entry point for investors. Finally, we highlight several exchange-traded funds (ETFs) that offer diversified exposure to the broader space economy.

Growth Opportunities in the Global Space IndustryThe global space economy, in particular the commercial sector, has rapidly evolved from a speculative frontier into a high-growth industry over the past couple of years. 

The numbers paint a picture of a robust and expanding market. In 2025, the global space economy reached a record $686 billion, up 12% from the previous year, with commercial activity accounting for the vast majority, or roughly 79%, according to a report from the Space Foundation.

With the growing dominance of private-sector investment in commercial space activities, backed by plummeting launch costs, several commercial players are competing nowadays to grab more space assets. 

The industry is also benefiting from the shift from government-led initiatives to a revenue-driven model. Companies are monetizing outcomes such as satellite connectivity, Earth observation data, and in-space services rather than simply selling hardware, thereby generating more predictable recurring revenue streams.

Structural demand for space rockets and components continues to rise, driven by government procurement reforms and national sovereignty needs amid growing geopolitical tensions worldwide.

The industry outlook remains bullish, with the Space Foundation projecting that the global space economy could surpass $1 trillion as soon as 2032, with the commercial sector once again expected to account for the majority of the total.

Why This May Be a Good Time to Invest in Space ETFsWhile the long-term growth story is compelling, the industry faces significant risks that could weigh on individual stock investments. 

The space industry is inherently capital-intensive, requiring massive upfront investments in research, development and infrastructure before generating any returns. Launch delays, technical failures, and cost overruns are common, with several high-profile setbacks in 2026 highlighting the risks and undermining investor confidence in affected companies. 

Regulatory complexities around spectrum allocation, orbital debris and national security concerns add another layer of uncertainty. Many space companies remain unprofitable, with their valuations driven more by growth prospects than current earnings, making them particularly susceptible to shifts in market sentiment and interest rates.

These industry-specific challenges underscore why space ETFs represent a prudent choice for most investors seeking exposure to this transformative sector. 

By providing a diversified basket of companies across the space value chain, from launch providers and satellite manufacturers to ground equipment suppliers and data analytics firms, ETFs mitigate the idiosyncratic risks that plague individual stocks. This diversification cushions the impact of any single company's technical failure or financial setback.

Space ETFs to ConsiderConsidering the aforementioned discussion, investors seeking to capitalize on the long-term growth opportunities offered by the global space economy may consider adding the following ETFs to their watchlists and investing in them if appropriate:

Tema Space Innovators ETF (NASA - Free Report)

This fund, with assets under management (AUM) worth $1.05 billion, offers exposure to 37 companies involved in space exploration, rockets and propulsion systems, and satellite technology, among other commercial opportunities. SPCX holds the first spot in this fund with 24.15% weightage, while Rocket Lab (RKLB - Free Report) holds the second spot with 9.68% weightage. 

NASA charges 75 basis points (bps) in fees and traded at a volume of 1.25 million shares in the last trading session.

ARK Space & Defense Innovation ETF (ARKX - Free Report)

This fund, with net assets worth $759.5 million, offers exposure to companies that are engaged in the Space Exploration and defense innovation. SPCX holds the first spot in this fund with 10.22% weightage, while L3Harris Technologies holds the second spot with 6.87% weightage. 

ARKX charges 75 bps in fees and traded at a volume of 0.41 million shares in the last trading session.

Procure Space ETF (UFO - Free Report)

This fund, with net assets worth $545.6 million, offers exposure to companies engaged in space-related industries. Trimble Inc. holds the first spot in this fund with 6.78% weightage, while Garmin Ltd holds the second spot with 6.70% weightage.

UFO charges 75 bps in fees and traded at a volume of 0.21 million shares in the last trading session.

VanEck Space ETF (WARP - Free Report)

This fund, with net assets worth $34.8 million, offers exposure to 23 companies involved in the space industry. SPCX holds the first spot in this fund with 23.25% weightage, while Rocket Lab holds the second spot with 10.75% weightage. 

WARP charges 50 bps in fees and traded at a volume of 0.02 million shares in the last trading session.  

Starting in August and reinforced by an impressive earnings report, SpaceX (NASDAQ: SPCX) stock has slowly been regaining ground lost in its initial months in the public markets.

Indeed, the fall to all-time lows early in the previous month and the subsequent performance lent credence to speculation that waiting for a relatively predictable correction rather than investing immediately upon the SPCX initial public offering (IPO) would prove the savvy move.

Thus, traders who took the then-imminent earnings report as a sign the downtrend could be broken and put $10,000 in SpaceX stock at the very start of August – specifically at the month’s first closing price of $114.53 – would have enjoyed $2,419 in profits by the September 1 closing bell.

SpaceX stock price one-month chart. Source: Google Investors who recognized, through luck and skill, $104.83 reached shortly before the earnings and built up a position of the same size at the price would have seen an even greater 35.68% return for nearly $3,568 in profits and SPCX holdings worth $13,657.68.

How much could a $10,000 SpaceX stock investment be worth in the future Meanwhile, early SpaceX stock investors – or at least those who failed to fill their orders at the IPO price of $135 – are yet to see a profit on their trades, as, even after the rally, SPCX remains below its day-one open at $150 and close at $160.95.

Still, the vast majority of institutional analysts and several high-profile technology executives remain confident the situation will change in the future. 

For example, the Street high SpaceX stock price target for the next 12 months stands at $800, indicating that a $10,000 investment made on the equity’s first day could rise above $50,000 by the summer of 2027.

Though the average forecast is substantially lower and at $232.35, it still means that institutional analysts anticipate original buyers will see their positions nearly double within just a year.

Still, Nvidia (NASDAQ: NVDA) CEO Jensen Huang might be the most bullish individual who has, so far, opined on the future value of Elon Musk’s newer public company. 

Specifically, he opined that buying SPCX shares close to their IPO might be akin to holding a stake in companies like Amazon (NASDAQ: AMZN), Meta (NASDAQ: META), and Google (NASDAQ: GOOGL).

In the most extreme interpretation – the one that assumes SpaceX stock will behave like AMZN – the prediction means a $10,000 investment in the social media, rocket, internet, and artificial intelligence (AI) company could end up worth nearly $29 million early in the second half of the century.

Featured image via Shutterstock

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