At today’s trading price, SpaceX is worth $1.77t and Musk’s 42% stake US$760b (from a peak US$1.2t)
SpaceX lost US$4.9b last year on US$18.7b revenue, according to its pre-IPO filing with the United States Securities and Exchange Commission.
That means SpaceX is trading at close to 100x its revenue, compared to Nvidia (regarded by some as trading in a bubble) at 22x.
SpaceX bulls – who include its IPO underwriter Goldman Sachs with a US$205 12-month target and Morgan Stanley, which sees the stock hitting US$300 in a year – see huge growth ahead, including data centres in space. Longer term, SpaceX’s prospectus raised the prospect of asteroid mining and colonising the moon and Mars.
In the immediate term, there are some more down-to-Earth challenges.
Starlink – SpaceX’s cash cow, with 10 million users worldwide, including 85,000 in New Zealand – seems set to lose its monopoly on low-Earth orbit satellite broadband within months.
Amazon’s Amazon Leo says it will have enough satellites in orbit – around 400 – for commercial launch by year’s end. SpaceX has around 10,000 in orbit but only around 650 of its next-gen model capable of satellite-to-mobile voice and data.
Jeff Bezos’ firm has earmarked at least US$10b toward Amazon Leo, which has included buying land for a ground station in New Zealand and hiring local staff. It’s also jump-started its effort by spending US$11.6b to acquire established satellite network operator Globalstar.
A second rival, AST SpaceMobile – backed by Google, Vodafone, Samsung and other tech and telco giants – is also just months away from its satellite broadband launch.
AST has a different model, relying on a handful of satellites, each with a tennis court-sized array for a giant coverage footprint.
AST’s local partner 2degrees has been building a ground station for the US firm in Marton in the Manawatū (as well as one in central Auckland for SpaceX).
Earlier this week, 2degrees chief executive Mark Callander revealed that his company has gained a radio licence to operate the Marton ground station, which could be an indication its commercial launch is close.
Then there’s Sir Peter Beck’s Rocket Lab, which has won a lot of US military and Nasa rocket launch business – with Musk’s feuding with US President Donald Trump and the US space agency not hurting the Kiwi-American company’s cause.
On June 30, Rocket Lab said it had entered into an agreement to buy satellite network operator Iridium for US$8b, with plans to upgrade. Beck had long hinted at an ambition to take on Starlink. Now, he’s part of scrum of contenders taking on the SpaceX subsidiary.
The new competition was now highlighted in Space X’s pre-IPO SEC filing, which had 63 mentions of future Martian operations but only a single mention each for Amazon Leo and AST SpaceMobile, each on page 219.
Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.
