By Dan Gallagher
Making large-language models is hard. Rockets are even harder.
SpaceX and OpenAI are both racing toward public offerings, which will highlight two very different businesses that are both putting distinctive spins on the artificial-intelligence market.
The rivalry runs deep. SpaceX's IPO filing and the reports that OpenAI's filing is imminent came just two days after SpaceX's founder and chief executive officer, Elon Musk lost a jury trial over a lawsuit challenging OpenAI's corporate structure. That loss still produced a case that packed plenty of embarrassing details for OpenAI and its polarizing CEO, Sam Altman.
The two offerings are sure to invite comparisons despite the sharp differences between the companies. SpaceX is targeting a public valuation of around $1.5 trillion when it lists its shares, expected sometime in the middle of next month. Meanwhile, OpenAI's last private-market valuation of $852 billion strongly suggests that the ChatGPT owner will also have trillion-dollar aspirations.
Importantly, Musk has succeeded in building SpaceX into a unique business that has deep competitive moats. OpenAI, by contrast, is going public as companies such as Alphabet's Google and Anthropic have built competitive AI models that are eating into ChatGPT's first-mover advantage.
Both SpaceX and OpenAI are still relatively small companies to justify such heady market capitalizations. SpaceX generated $18.7 billion in revenue in 2025, while data obtained by The Wall Street Journal shows OpenAI at $13.1 billion in revenue for the same period. That would put both around the middle of the S&P 500 in terms of revenue size. The 11 companies in the index currently carrying market caps above $1 trillion average a little over $260 billion in annual revenue, according to data from S&P Global Market Intelligence.
For SpaceX, a $1.5 trillion market cap would represent a great deal of faith from investors that Musk can accomplish at least some of his science-fiction dreams. But for the here and now, SpaceX has developed a unique business model that is difficult to replicate.
Much focus has been on the Starlink broadband service, which generates the bulk of SpaceX revenue and commanded an operating profit margin of 39% last year. But that profit is made possible as SpaceX handles the expensive task of getting satellites into space. Starlink has about 9,600 satellites in orbit now, which is about 15 times as many as the orbital fleet of the next largest satellite service provider, according to estimates from New Street Research.
The rocket-launching business alone is a strong differentiator. That segment turned a profit for SpaceX in 2024 and only swung to a loss last year owing to the steep development costs of the Starship rocket. That rocket passed a key milestone with a successful launch last week, though it experienced problems that prevented the booster from landing intact. SpaceX has such a lead on the launch competition that even that setback is unlikely to be damaging to its position. The company claims it has accounted for more than 80% of the world's "mass to orbit" since 2023. A Roth Capital analyst, Rohit Kulkarni, said in a recent report that SpaceX has "monopolistic" share in the launch market.
OpenAI doesn't have anything close to that kind of grip on its key market. ChatGPT is still incredibly popular, but usage is also booming for Anthropic's Claude, Google's Gemini and other AI chatbots. The cost of training and running OpenAI's artificial-intelligence models is expected to consume all of its revenue for at least the next few years, while Google's highly profitable advertising and cloud-computing businesses are underwriting its AI investments. News Corp, owner of the Journal, has a content-licensing partnership with OpenAI.
Meanwhile, Anthropic's recent growth surge has put the company on track to turn an operating profit in the current quarter, the Journal recently reported.
SpaceX has started renting out its computing capacity to Anthropic instead of using that network exclusively for its own AI models. That will provide a revenue boost to SpaceX's money-losing AI business, but also sends an interesting signal -- that the famously risk-tolerant Musk feels frontier AI is a bet worth hedging on. SpaceX's other businesses hold a stronger hand anyway.
Write to Dan Gallagher at dan.gallagher@wsj.com
(END) Dow Jones Newswires
May 27, 2026 05:30 ET (09:30 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
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