Space Exploration Technologies (SPCX -2.16%) was founded in 2012 by Elon Musk, who wanted to drive down the cost of space transportation. The company went on to expand into the satellite internet connectivity and artificial intelligence (AI) industries, and then went public this past June.
SpaceX stock quickly soared to a peak of $225 following its initial public offering (IPO), but it has since declined by 34% to $148.68 (at the close of trading last Friday, Sept. 25). Despite the company’s incredible growth potential, it’s pulling in more sellers than buyers right now because of its sky-high valuation.
Here’s where I predict the stock will be in one year.
Image source: Getty Images.
$100 billion in AI revenue might be on the table in 2027
SpaceX developed the Falcon 9 and Falcon Heavy reusable rockets which currently launch around 2,500 tons’ worth of commercial payloads into orbit each year. Elon Musk believes enterprises and governments will eventually need up to 10 million tons’ worth of satellites, AI infrastructure, and other hardware sent into orbit each year, so this industry could grow significantly in the future.
However, SpaceX currently draws most of its revenue from the satellite internet connectivity business. The company has launched over 10,200 of its Starlink satellites into orbit to date, which beam internet connectivity to 12 million paying customers on Earth. But it’s about to start sending its new V3 Starlink satellites into space, which have 10 times the bandwidth of the current generation. Plus, they will travel on the new Starship rocket, which has four-times the payload capacity of Falcon 9.
The connectivity business accounted for more than half of SpaceX’s $7.8 billion in revenue during the second quarter of 2026 (ended June 30).
|
Segment |
Q2 Revenue |
Revenue Growth (Year Over Year) |
|---|---|---|
|
Space |
$0.96 Billion |
29% |
|
Connectivity |
$4.29 Billion |
66% |
|
AI |
$2.56 Billion |
247% |
Data source: SpaceX.
But the connectivity business could soon be leapfrogged by the AI business, which is currently growing at a much faster pace. SpaceX entered the AI industry when it acquired Musk’s start-up, xAI, earlier this year. The company uses xAI’s Colossus and Colossus II data centers to further improve its internal models, but it also rents spare computing capacity to other companies like Anthropic, Reflection AI, and Alphabet.
Demand for data center capacity is so strong that SpaceX chief financial officer, Bret Johnsen, thinks the AI business could have $100 billion in annualized run-rate revenue by the end of 2026. If he’s right, it will likely bring in more money next year than the space and connectivity businesses combined — by several orders of magnitude.
SpaceX stock could be much lower in a year
Setting Jonhsen’s forecast aside for a moment, SpaceX has generated $23 billion in total revenue over the last four quarters. Therefore, based on the company’s market capitalization of $2.02 trillion, its stock is trading at a price-to-sales (P/S) ratio of 87. It’s a whopping 13 times more expensive than the Nasdaq-100 index which has a P/S ratio of 6.4, so it looks heavily overvalued compared to America’s most elite tech companies.
Wall Street’s average estimate (provided by Yahoo! Finance) suggests SpaceX could grow its total revenue to $108.3 billion in 2027, so analysts are clearly giving Johnsen’s forecast for the AI business some credit. If we assume the Street proves to be right, then SpaceX has a forward P/S ratio of 18.5. While that looks like a more reasonable valuation, it’s still far more expensive than the Nasdaq-100 is today.
In fact, SpaceX stock would have to decline by 65% over the next year or so to match the P/S ratio of the Nasdaq, translating to a price of $52. I’m not suggesting it will fall that sharply, because the company has significant long-term potential, which brings me to my next point.
Space Exploration Technologies
Today’s Change
(-2.16%) $-3.21
Current Price
$145.47
Key Data Points
Market Cap
Day’s Range
$145.36 – $150.80
52wk Range
$104.83 – $225.64
Volume
1.3M
Avg Vol
92.6M
SpaceX recently developed a new satellite called Starmind, which is fitted with a variant of Nvidia‘s Vera Rubin data center systems. It’s designed to process AI workloads from space, where it will run on solar energy and won’t require an expensive cooling solution. It will beam data back to Earth via the existing Starlink network, so SpaceX is one of the world’s only companies with the distribution infrastructure to make space-based AI a reality.
Lawmakers in more than a dozen U.S. states have introduced legislation to temporarily ban the construction of new data centers while they weigh the social, economic, and environmental impacts. AI infrastructure consumes a significant amount of electricity and water, and citizens are starting to notice the negative effects, making it a hot-button political issue. Since Starmind satellites have none of that baggage, they could become the first choice for AI companies.
As a result, I think it’s possible for SpaceX stock to trade below $100 in a year from now because of its hefty valuation, but that might be a buying opportunity for long-term investors.
