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The space bit of SpaceX is worth $8 a share, says Morgan Stanley
- ben_w 3mo agoMy draft blog post about all the things that are up with space data centres keeps getting bigger and bigger. "The other half of the MS model is data centres. “Orbital compute deployments” start in 2028, reach cost parity with their earthbound equivalents by 2031, and put 364GW of rigs in space by 2040." With 25% efficient cells, at 500 km altitude, in a terminator-tracing SSO, this is enough to occupy a *contiguous* ring roughly 25 m tall, all the way around that orbit. Also, from other statements they're clearly copying Alphabet's study which said cost parity in 2035, if they can actually launch 370,000 tons and maintain their learning rate. https://arxiv.org/pdf/2511.19468 https://arxiv.org/pdf/2511.19468 "A $668bn funding obligation to 2034 that delivers free cash flow that year of negative $48bn sounds less than ideal, though FCF might flip positive to $138bn in 2035 if everything goes to plan, so that’s nice. The SpaceX CEO presumably has a long history of delivering products on time and to the required specification that can support such confidence." I love the snark here. "Helium-3 is one of the clearest examples of why lunar infrastructure could matter. The isotope is extremely rare on Earth, with current supply largely tied to tritium decay, but the Moon has accumulated helium-3 for billions of years because it lacks Earth’s atmosphere and magnetic field. NASA mining concepts often assume concentrations around 20 parts per billion, meaning helium-3 is abundant in total but painfully diffuse, requiring hundreds of tons of regolith to be mined and heated to recover small quantities." Ugh. This will need a separate blog post for why it's stupid. At 20 ppb, even if we could fuse He3, that makes lunar regolith marginally less energy dense than firewood. Also, anyone with a fusion reactor can make He3, even highschool students with home-made fusors can already do this. I'll have to check sources and maths to make sure I've not missed something important about which would be cheaper, *currently existing* neutron sources like fusors or going to the moon, but regardless, we can't currently use this stuff for fusion and the moment we can we won't need to mine it. (I have not yet formed an opinion about non-fusion uses for He3).
- adastra22 3mo agoHe3 is needed as a cryogenic for quantum systems, not fusion fuel.
- laughing_man 3mo agoAs I understand it, He3 is also used in nuclear materials detectors.
- ben_w 3mo agoMorgan Stanley list both.
- antonvs 3mo agoNot a coincidence that both technologies aren’t going to live up to the proponents’ claims, and both want materials we don’t really have.
- incognito124 3mo agoI'm also writing a blogpost on orbital datacentres, maybe we should compare notes!
- f4c39012 3mo agoDotnetrocks did an excellent breakdown https://www.dotnetrocks.com/details/2007 https://www.dotnetrocks.com/details/2007
- ben_w 3mo agoHere's my current draft; I expect perhaps 20-30% of it will need rewriting, not counting anything I've yet to add: https://github.com/BenWheatley/blog/blob/main/2026/06/22-23.18.43.content https://github.com/BenWheatley/blog/blob/main/2026/06/22-23....
- ubercore 3mo agoI just skimmed that linked paper. Only mention I found of cooling is: > Cooling would be achieved through a thermal sys- tem of heat pipes and radiators while operating at nominal temperatures. Isn't that drastically underselling potentially one of the harder parts of this whole endeavor?
- Havoc 3mo agoThat feels…low. They’re the only one with significant proven and operational space lift capacity
- verzali 3mo agoSpace lift is not very profitable. The money comes from whatever you actually put in orbit with that lift capacity.
- adastra22 3mo agoSpaceX’s launch services have huge margins.
- ben_w 3mo agoHuge negative margins, according to the article: "Starting with the reusable rockets, MS expects SpaceX to eat itself. Launch costs will collapse by more than 99 per cent versus their historical average within 10 years, it says. Operating margin on launches will have jumped to about 40 per cent, from around negative 50 per cent currently, but 40 per cent of less than 1 per cent still isn’t very much." Though as someone (probably JumpCrisscross, can't remember) pointed out a previous time this came up, as SpaceX is selling launch to Starlink, and also own Starlink, which one of the two gets to count as making a profit or a loss is just a matter of preference.
- adastra22 3mo agoThis is my industry I know it well, apparently much better than these bozos. SpaceX launch is only “unprofitable” only in the accounting sense because they reinvest their profits into Starship. Their actual profit margin for launch of F9 is 62% - 80% depending on configuration. That is a margin unheard of in aerospace. There is literally no competition worth speaking of, and nobody to provide downward price pressure. SpaceX started moving into their own constellations because lower prices open up new markets, and this lets them access those markets without having to lower launch prices. And if you think, as Morgan Stanley seems to, that the only money to be made in space is selling launch of earth orbiting satellites, you’re going to miss out on the boom that is going to make the first quadrillionaire.
- adastra22 3mo agoThis feels like the “there’s a global market for maybe 4 computers” of the 21st century.
- SideQuark 3mo agoThis feels like the “we should make an internet company that ships pet food to anyone, anywhere!” of the 21st century.
- JumpCrisscross 3mo ago> In our model, we estimate SpaceX raising an average of $72bn annually between 2027 and 2030 and then an average of $95bn annually between 2031 and 2034 Ah. There it is. Even if that's all done as investment-grade debt (with a 50 bp underwriting spread), that's $3+ billion of banking fees.
- kryptiskt 3mo agoI really wish I could buy the SpaceX part of SpaceX decoupled from all the AI hopium.
- tristanj 3mo agoYou might enjoy Rocket Lab $RKLB, pure space tech without the AI distraction.
- discreteevent 3mo agoPanhandler > I sat out the TMT bubble until they quit using the term "information superhighway," and it saved me an 80% drawdown. > I'm sitting out the AI / chip / SpaceX [AICSX, pronounced like the wrestling shoes?] bubble until they stop using the word "compute" as if it were a noun. > I'm guessing I'll save myself a drawdown on a similar scale. A comment under the original article.
- antonvs 3mo ago> until they stop using the word "compute" as if it were a noun. That’s a bit silly, since it is a noun at this point, meaning computing resources or computing capacity. It’s nowhere near being a term similar to “information superhighway”, which was never a technical term used within the industry, it was purely used in communication mostly to the public or in government agency and contractor slide decks.
- JKCalhoun 3mo ago“Information Superhighway”, ha ha (and replete with billboards as we have come to find out). As opposed, I suppose, to the library. Which is perhaps more like an information bike lane. (Or a pedestrian walkway?)
- deleted 3mo ago[deleted]
- ghtbircshotbe 3mo agoI have a hard time imagining how spx stock will drop to a reasonable price. You have to be a true believer at its current valuation, so who is going to sell? Maybe if enough insiders or stock options start selling it will drop.
- padjo 3mo agoSlowly at first, then quickly.
- JKCalhoun 3mo agoThe market overall drops and large investors start shedding their pricier/riskier stocks to offset losses.
- Alpha3031 3mo agoWell, as I understand it, SpaceX intends to continue to raise money from the market. Eventually the true believers will stop having money to give them.
- ben_w 3mo agoI expect via court order or government intervention. How many of the HODLers will be SpaceX believers, vs. Musk believers? Musk's already only narrowly avoided being banned from running publicly traded companies from the $420 tweet years back.
- josefritzishere 3mo agoIt makes zero dollars, but generates a lot of debt. It's worth negative dollars by any sane measure.
- keernan 3mo agoI can't access the article but it's my understanding the AI bit of SpaceX is a negative valuation (ie losing money like a gutted pig).