SpaceX is betting its future on artificial intelligence, and Wall Street thinks the company could be massively undervalued. Morgan Stanley analyst Adam Jonas set a $300 per share price target for SpaceX, implying 129% upside from its current price of $131, based largely on the company's ambitious plans to build orbital data centers in space.

Why Is SpaceX Suddenly Focused on AI?

SpaceX operates three distinct business segments: space launch services, Starlink satellite internet connectivity, and artificial intelligence infrastructure. The company believes it has a unique advantage in combining these capabilities to solve a critical problem facing the AI industry: power and cooling constraints that limit how large terrestrial data centers can grow.

CEO Elon Musk told analysts that SpaceX plans to launch the first orbital data centers in 2027. The company expects to end 2026 with over 2 gigawatts of compute capacity online, then scale to somewhere between 5 and 10 gigawatts by the end of 2027. To put that in perspective, 2 gigawatts is roughly equivalent to the power consumption of a mid-sized city.

"SpaceX combines near-monopoly launch economics, the largest low-Earth orbit satellite network, and a fast-scaling AI infrastructure business. We see the company as one of the few platforms that can link real estate in orbit, global connectivity, and compute capacity into one infrastructure stack," stated Adam Jonas, analyst at Morgan Stanley.

Adam Jonas, Analyst at Morgan Stanley

How Is SpaceX's AI Business Performing Right Now?

SpaceX's second quarter financial results, released as the company's first earnings report after going public, showed explosive growth in the AI segment. Total company revenue jumped 92% to $7.8 billion, but the real story was in AI: sales more than tripled in that segment alone.

However, the company is still burning cash. SpaceX reported a net loss of $541 million in the second quarter, primarily because the company is investing heavily in AI compute infrastructure and continuing to develop its next-generation Starship rocket. Management signaled that AI spending will accelerate in coming quarters as the company races to build out its orbital infrastructure.

What Does Morgan Stanley Expect From SpaceX's Growth?

Jonas projects that SpaceX's total revenue will compound at 88% annually through 2030, reaching $319 billion. But the growth won't be evenly distributed across the company's three segments. Here's how Jonas breaks down the expected trajectory:

• AI Segment: Expected to grow at 148% annually and reach $190 billion in revenue by 2030, driven by both AI infrastructure services and enterprise AI applications
• Connectivity Segment: Starlink is projected to grow at 69% annually, becoming a major revenue contributor as satellite internet adoption expands globally
• Space Segment: Launch services expected to grow at a more modest 16% annually as the market matures, but still contributing meaningfully to overall revenue

The AI segment's projected dominance is striking. By 2030, Jonas expects AI to account for roughly 60% of SpaceX's total revenue, compared to connectivity at about 30% and space launch at roughly 10%.

What Are the Risks Investors Should Consider?

SpaceX faces significant challenges that could derail these ambitious projections. The company's plans to build orbital data centers remain entirely theoretical; no orbital AI infrastructure has been deployed or tested at scale yet. Additionally, SpaceX is currently unprofitable and burning substantial cash, which means the company will need to successfully execute on multiple fronts simultaneously.

There's also the matter of share dilution. SpaceX's initial public offering (IPO) in 2026 sold 555 million shares, but another 911.5 million shares became available for trading after the company's second quarter earnings report. The company's float, or the number of shares available for public trading, will more than triple from about 1.4 billion today to over 5 billion by year end. This means early investors and insiders may sell shares in the coming months, potentially pressuring the stock price.

Despite these headwinds, Jonas and other Wall Street analysts remain bullish. The stock has actually gained more than 10% since its first lockup expiration on August 6, suggesting that investors are betting on the company's long-term potential rather than panicking about near-term profitability.

How Should Investors Think About SpaceX Stock?

SpaceX is a difficult company to value because it's pursuing multiple growth vectors simultaneously. The company has a proven business in launch services and a rapidly growing satellite internet network in Starlink. But the AI infrastructure play is entirely new territory, and success is far from guaranteed.

For investors with a time horizon of at least five years, the risk-reward profile may be attractive. The stock is currently trading below its IPO price of $135 per share, and the median price target among 40 analysts is $217 per share, implying 65% upside. Jonas's more aggressive $300 target suggests even greater potential if SpaceX successfully executes on its orbital AI infrastructure vision.