SpaceX Earnings: Stock Significantly Overvalued as Massive AI Investments Outweigh Hefty Neocloud Rent

Key Morningstar Metrics for SpaceX

• : $62
• : ★

• Morningstar Economic Moat Rating

  : Narrow

• Morningstar Uncertainty Rating

  : Very High

What We Thought of SpaceX’s Earnings

Second-quarter revenue grew to $7.8 billion, up 92% compared with 2025, led by an eye-watering but not surprising sevenfold increase in AI solutions revenue from neocloud rentals. Launch and Starlink grew 29% and 67%. Investments of $3.5 billion in R&D resulted in a $143 million operating loss.

Why it matters: Notwithstanding a sizable market opportunity for profitable growth in Starlink, the widest range of potential outcomes of SpaceX SPCX’s future value lies in its artificial intelligence ventures, which are currently predicated on rapidly deploying computing capacity and renting it out.

The bottom line: We haven’t altered our forecast based on second-quarter results, and we reaffirm our $62 fair value estimate for narrow-moat SpaceX’s stock.

• Even with its marked volatility since the IPO, we think investors are still factoring more optimistic scenarios for Starship reusability and the commercial advantage of orbital datacenters than are most probable at this point.
• We see SpaceX’s stock as overvalued: they traded at around twice our fair value estimate after hours on Aug. 4.

Between the lines: We aren’t sure whether the company’s announcement that it will use Nvidia chips exclusively for its upcoming orbital AI satellites and future terrestrial datacenters represents a retreat from previously announced plans to design and fabricate its own AI chips in co-operation with Tesla.

• On the one hand, we aren’t surprised by the announcement, as we had already modeled SpaceX’s proposed orbital AI “racks” based on Nvidia’s 72-GPU units already in production, and we assume that, with moderate customization, Nvidia can configure them for SpaceX’s needs.
• If the exclusive arrangement remains long-term, it may signal a commitment to maintaining ample computing capacity for neocloud rental, using chips widely understood by industry participants rather than custom chips.