By Al Root
SpaceX's mega IPO and valuation can yield some interesting math.
Try this: Elon Musk's space company, which sends dozens of rockets into orbit each year is worth more than all the aerospace & defense companies in the S&P 500.
That includes a dozen companies, including GE Aerospace, Boeing, Lockheed Martin, Northrop Grumman, and RTX.
Aerospace companies in the S&P are worth roughly $1.5 trillion. SpaceX will be valued at about $1.8 trillion, based on its expected IPO pricing of $135 a share.
Those aerospace players also generate roughly half a trillion in annual revenue, more than 10 times what SpaceX is expected to produce in 2026.
None of that is truly surprising. SpaceX isn't really an aerospace and defense company. Its space launch business -- an aerospace business -- only enables it to do what really excites investors: space-based communications and AI computing.
Starlink is SpaceX's space-based broadband product with some 10,000 satellites and 10 million-plus subscribers. Starlink generated first-quarter 2026 revenue of $3.3 billion, up 32% year over year. Operating profit was $1.2 billion, up 15%.
Verizon Communications, AT&T, and T-Mobile US are worth a combined $540 billion. SpaceX dwarfs them, too.
To put SpaceX in context requires looking at the tech sector. The top 10 tech companies in the S&P 500, including Nvidia, Broadcom, Micron Technology, and others, are worth $26 trillion and generate annual sales of $2.7 trillion.
That's what SpaceX is shooting for with its orbital data centers, which Musk hopes will be cost-competitive with terrestrial data centers in a few years.
AI is what underpins most of SpaceX's massive valuation. Now, the company just needs to build low-cost AI data centers in space.
Many investors will doubt it can happen. Musk has done it once before. Tesla essentially invented the EV business. Now, it's worth roughly $1.5 trillion, easily more than the combined value of the U.S. auto sector.
Of course, Tesla's EV sales have slowed, and it's pivoted toward "phyical AI" applications such as robo-taxis and robots. AI underpins Tesla's valuation just like it does SpaceX. And AI optimism is a big reason that Tesla is worth more than 10 times Ford Motor and General Motors combined.
Write to Al Root at allen.root@dowjones.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
June 10, 2026 00:30 ET (04:30 GMT)
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