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July was a brutal month for space stocks.
BlackSky (BKSY) was down almost 20%. Rocket Lab (RKLB), AST SpaceMobile (ASTS), and Planet Labs (PL) shed more than 30%. Even SpaceX (SPCX) – fresh off the largest IPO in history – slid over 50% from its June 16 record close.
But here’s what makes this moment so interesting: while the stocks were selling off, the businesses were doing the exact opposite.
BlackSky just reported 50% year-over-year revenue growth and swung to positive adjusted EBITDA. Redwire (RDW) posted record revenue – up nearly 90% year-over-year – with gross margins flipping from deeply negative to nearly 28%, and a record $542 million backlog. And SpaceX’s first-ever public earnings report showed revenue up 92%, with its AI segment growing 247%.
That’s a dislocation. Prices went one way while fundamentals went the other. And now, these beaten-down names are showing early signs of reversal.
We think they’ve still got miles of orbital runway left.
Why? Because the space economy is finally getting real. It’s no longer some far-off “Jetsons” fantasy.
Defense Spending Is Becoming a Growth Engine for Space Stocks
We’ll start with the national security angle first.
Governments are waking up to the uncomfortable fact that space is the new strategic battleground.
Satellites can now provide real-time battlefield intelligence, secure military communications, early warning missile detection, navigation and targeting systems, and surveillance on rival (and even friendly) nations.
Just look to Ukraine – its military would likely have been wiped off the map without Starlink – or China, which now considers satellite dominance a national priority.
Even the Pentagon has created a $30-plus billion annual budget line called the U.S. Space Force.
This is a long-term arms race – one that favors nimble, responsive space companies with launch capacity, satellite imaging capabilities, and hardware manufacturing.
The usual suspects benefit here:
- BlackSky, which provides real-time Earth intelligence for military and defense
- Planet Labs, operator of the largest constellation of Earth observation satellites
- Rocket Lab, launch provider for government payloads, hypersonic testing
- Palantir (PLTR), which offers analytics for satellite data
The bottom line? We estimate national defense TAM in space is about $30- to $40 billion today. But as intelligence demand and geopolitical tensions escalate, it could easily double over the next decade.
And it’s just one vertical of the multi-faceted Space Economy…
Satellite Internet Is Expanding the Space Economy
Another big vertical here is space-based communications because the entire communications industry is being rewritten from orbit.
The world is moving toward a space-powered internet: a global, always-accessible broadband network delivered from thousands of small satellites in low Earth orbit (LEO).
This is more than a theoretical future. It’s already in action:
- Starlink now has over 10,000 satellites in orbit and serves 12 million users worldwide.
- Amazon Leo (formerly dubbed Project Kuiper) continues building out its constellation to support AWS and global internet.
- AST SpaceMobile is going one step further, building the first cell tower in the sky that connects directly to your smartphone without dishes or terminals.
That’s a major step up, especially considering that 2.2 billion people worldwide still lack reliable internet access, and billions more suffer from poor mobile coverage.
Not to mention, we still don’t have cell coverage on airplanes. And natural disasters like earthquakes, fires, and tsunamis often knock out cell coverage when we need it most.
That’s why we think the total addressable market here is huge. We see it climbing toward $150 billion by 2035 – possibly much more if these constellations become the backbone for rural broadband, global telecom, and even cloud connectivity.
Who benefits?
- ASTS – offers direct satellite-to-phone coverage in partnership with AT&T, Vodafone, and Telefonica
- RKLB – launching communications satellites for multiple players
- PL & BKSY – may support telecom mapping, planning, and routing
- SpaceX – now public after the largest IPO in financial history, giving retail investors direct access to the most dominant player in the space economy for the first time
Between national defense and communications, we’re already staring at a $50- to $65 billion market in space today.
And it’s still very early days.
Orbital Data Centers Could Become the Space Economy’s Biggest New 蜜桃传媒
Here’s the vertical that didn’t exist when we first started writing about the space economy – and it may end up being the biggest of them all.
AI’s growth is running into hard physical limits on Earth. Data centers need enormous amounts of land, power, and water – and communities increasingly don’t want them nearby. Lawmakers in at least 14 states have introduced legislation to restrict new data center construction.
Space solves all three problems at once. Orbital data centers harvest uninterrupted solar power around the clock, require zero land, and radiate waste heat directly into the vacuum of space – no water needed.
The ‘land grab’ has already begun. SpaceX has filed with the FCC to launch up to one million orbital data centers. Google has entered talks with SpaceX to expand its own space-based compute efforts. Anthropic has expressed interest in partnering on orbital AI capacity. And Jeff Bezos’ Blue Origin just asked the government for permission to launch more than 50,000 orbital data centers of its own.
Every one of those satellites needs launch capacity, solar arrays, specialized hardware, and in-orbit servicing. The companies supplying those pieces sit directly in the path of what could become a multi-trillion-dollar buildout.
Four More Space Economy 蜜桃传媒s Investors Should Watch
This is all great news for RKLB, PL, BKSY, and ASTS. But those are likely just the first puzzle pieces to unlocking profits within the trillion-dollar space economy.
Earth Observation: Turning Satellite Images Into Intelligence
There’s Earth observation.
We’re entering the age of persistent planetary surveillance. Think:
- Monitoring crop yields (for commodity traders)
- Tracking cargo ships (for logistics and supply chains)
- Detecting oil spills, deforestation, wildfires, and droughts
- Verifying carbon emissions and ESG compliance
Governments, hedge funds, insurers, farmers, and climate groups all want this data.
PL and BKSY are two of the biggest players in this niche. They control massive constellations of satellites and sell high-frequency data with AI analytics on top.
TAM for this sector is expected to hit $20- to $30 billion by 2030.
Lunar Infrastructure: Building a Commercial Economy Around the Moon
There’s also space infrastructure.
Missions to the Moon. Telecom relays on lunar orbit. Bases on Mars. It all sounds sci-fi – until you realize NASA’s Artemis Program is already working on it.
The Moon is now an infrastructure hub for mining water ice (rocket fuel), telescopes (no light pollution), communication relays, and launching deeper-space missions.
Rocket Lab’s Photon satellite bus has already delivered a mission to lunar orbit. Other players like Intuitive Machines (LUNR) and Astrobotic are planning landers.
It might be niche today, but it’ll be potentially huge tomorrow.
Satellite Servicing: The Maintenance Layer of the Space Economy
There’s also in-space manufacturing because… let’s face it… why make stuff on Earth when microgravity offers the perfect conditions for making certain things? Like:
- ZBLAN fiber optics: 100x better transmission, only manufacturable in space
- Protein crystal growth: better drugs, vaccines, and biotech
- Semiconductors: zero-defect vacuum conditions
Startups like Varda Space are building in-space factories. Redwire is printing tools on the ISS. In fact, Rocket Lab is already launching some of these missions.
Tiny TAM today – but potential for $10- to $20 billion by 2040.
Space Servicing: Maintaining the New Orbital Economy
And then you have the whole satellite servicing market.
Satellites are expensive. They age, fail… and then crash, rendering them nothing more than junk. The solution therein?
- Servicing and refueling in orbit
- ‘Tugboats’ for moving satellites
- Bots to clean up space debris
This is like the equivalent of AAA for space. And we think it could be a $10-billion-plus market by the 2030s.
The Bottom Line: Space Stocks Are Still Early in a Much Bigger Economy
Put all this together – defense, communications, orbital compute, EO, infrastructure, manufacturing, servicing – and the total space economy TAM is already near $100 billion.
Depending on regulation and global policy, that number could stretch to unfathomable heights over the coming decades.
Now here’s the real kicker: outside of SpaceX, not many own this trade yet.
Planet Labs has a market cap of approximately $8 billion. AST SpaceMobile is right around $27 billion. And BlackSky is only valued at about $1 billion.
In terms of their addressable market, these are penny stocks with planetary potential.
Now, to be sure, not every company will win. Some will fizzle or get acquired. Some might crash and burn, literally.
But the winners will provide the foundational infrastructure for the next trillion-dollar economy. And as we saw during the early internet era, a single winner could 20X, 50X, even 100X in a decade.
So, the smartest approach here might be a simple one: buy a basket of them now. Don’t try to pick the single winner. Just be exposed.
Because if this space economy thesis plays out – and the signs are saying it’s already well underway – the upside will vastly outweigh any individual misfires.
There’s just one wrinkle to the basket approach.
For the first time, all the puzzle pieces I just described – launch, satellites, AI compute, robotics, manufacturing – are being assembled under a single roof, by a single man.
Elon Musk took SpaceX public in the largest IPO in history. He merged it with xAI. And now, virtually every Silicon Valley insider – from his own biographer to the president of SpaceX herself – expects him to complete the consolidation with the biggest merger of all time.
The estimates around what it could be worth are staggering – bigger than AI, robotics, clean energy, and driverless cars combined.
And just like the space stocks in this piece, the biggest gains won’t come from owning the giant at the center. They’ll come from the – including one that trades for just $15 a share.
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