SpaceX (SPCX +1.22%) is widely considered a space stock. In reality, the company is better considered an artificial intelligence (AI) stock. Take a look at the company's IPO prospectus, and you'll quickly learn why.
"We believe we have identified the largest actionable total addressable market in human history," the company declares. "We estimate that our quantifiable TAM is $28.5 trillion."
Almost all of that total addressable market figure -- some $26.5 trillion -- relates exclusively to AI. Just $370 billion is tied to "space-based solutions." The remainder -- $1.6 trillion -- relates to SpaceX's "connectivity" segment, which primarily includes its Starlink internet and mobile services.
For SpaceX to justify its $1.8 trillion valuation, it will need to capture a large fraction of its AI opportunity. For now, however, it is Starlink that is propping up the company's financials.
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Key Data Points
Here's why SpaceX needs Starlink to succeed
When SpaceX went public this summer, analysts were high on Starlink.
"Though SpaceX was originally pitched as a space exploration company, its most profitable segment is Starlink," stressed Morningstar. "Starlink recorded an 86% increase in adjusted EBITDA between 2024 and 2025, while its total subscribers doubled."
Subscriber growth and operational leverage continued this quarter, with the company posting strong increases in sales and satellite counts, averaging more than 500,000 net subscriber additions per month. Some analysts now predict Starlink will have between 35 million and 45 million subscribers by the end of the decade.
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While Starlink represents a tiny fraction of SpaceX's total claimed long-term growth potential, the segment is critical to the company's near-term financials. The company is flush with the proceeds of its IPO and a follow-on bond offering, but the combined entity still posted a $541 million loss last quarter. That was down from a $1 billion loss during the same period last year.
But with heavy AI-related spending expected for years to come, SpaceX will likely need to rely on capital markets for some time to fund its growth. Starlink's financial success reduces that reliance. And while AI companies aren't facing difficulties raising capital right now, conditions will likely fluctuate in the years to come. Starlink's growth and profitability will play an important role in SpaceX getting its AI ambitions across the finish line -- which will be the only way the company can justify its current gargantuan market cap.
