Why Wall Street Suddenly Sees SpaceX as an AI Company

Why Wall Street Suddenly Sees SpaceX as an AI Company

SpaceX shares have fallen about 40% since their June 12 IPO and now trade below the $135 listing price.

Wall Street is increasingly framing SpaceX's Starlink network as AI infrastructure rather than just a space or satellite business.

SpaceX's first public earnings report on Aug. 6 is seen as pivotal for validating the AI narrative amid mixed analyst price targets.

When SpaceX NASDAQ: SPCX went public just over a month ago, on June 12, it did so as the most hotly anticipated listing in years, and unmistakably as a space company. Rockets, satellites, and Mars ambitions were the story. But barely a month into its life on the public markets, a different narrative is taking hold on Wall Street, and it has far more to do with artificial intelligence (AI) than with space travel.

SPCX SpaceX $123.99 -7.12 (-5.43%) As of 07/17/2026 04:00 PM Eastern 52-Week Range $122.12 ▼ $225.64 Price Target $234.78 Add to Watchlist

The timing is interesting because the stock itself has had a rough start. After hitting a post-IPO high in the sessions following its IPO, SpaceX shares have slumped around 40% and are now trading below the $135 price at which they listed.

Get SpaceX alerts: Sign Up For a company that generated so much excitement coming to market, dipping below the IPO price inside the first few weeks isn’t a great look. Yet beneath that disappointing price action, the emerging investment case may be more compelling than the chart suggests.

Why the AI Narrative Is Taking Over The core of the argument is Starlink, SpaceX's satellite internet network. On the surface, it's a connectivity business, beaming broadband down to homes, vehicles, and remote corners of the planet. But increasingly, investors are recognizing that a global, low-latency connectivity network is exactly the kind of infrastructure the AI era is going to depend on. As AI systems become more embedded in everyday devices, vehicles, and industrial applications, the need for reliable connectivity to move data back and forth grows enormously. Starlink is one of the very few networks capable of providing that coverage at scale.

The bulls argue that this could make SpaceX something like an AI infrastructure landlord, with its network and vertical integration allowing it to control data movement and potentially support entirely new compute products over time. This is a view that Wedbush's Dan Ives has been vocal about for some time. He argues that SpaceX should be seen as much more of a data and AI play than a traditional space company, pointing to the strategic value of its network and the growing data demands flowing through it. If that framing gains wider acceptance, it fundamentally changes the lens through which the company is valued to the upside.

The Speculative Upside, and the Very Real Risks Beyond connectivity, there's an even more ambitious element to the thesis. There has been growing discussion around the potential for data centers in space, using solar power and natural cooling to run compute-intensive AI workloads outside the constraints of terrestrial infrastructure. Tied to this is the Terafab semiconductor project, which Oppenheimer recently described as “critical” to SpaceX's future valuation, while also cautioning that it remains speculative and carries real execution risk. That tension sits at the heart of the debate. The upside case is enormous, but it rests on ambitious projects that are far from proven, and the company is burning through significant cash to pursue them. The bears make a fair point that the current valuation already implies extraordinary growth, with no guarantee that the vast AI opportunity translates cleanly into durable, high-margin profits.