SpaceX, recently added to the Nasdaq-100, boasts a market value ($1.48 trillion) that surpasses Meta and Tesla, though it lags behind the other Magnificent Seven tech giants. Despite a high valuation and current unprofitability, Wall Street anticipates significant sales growth and a return to positive EPS by 2027, driven by its ambitious AI ventures in addition to its space and Starlink businesses.
Space Exploration Technologies (SPCX), despite not being an official member of the esteemed "Magnificent Seven" group of tech giants, boasts an impressive total market value of $1.48 trillion. This valuation places it ahead of two key Magnificent Seven components: Meta Platforms (META) and Tesla (TSLA).
The remaining members of the Magnificent Seven – Apple (AAPL), Nvidia (NVDA), Alphabet (GOOG, GOOGL), Microsoft (MSFT), and Amazon (AMZN) – stand as the five most valuable companies globally. These tech powerhouses are not only leaders of the Nasdaq-100 index, a critical barometer for market sentiment toward technology and artificial intelligence (AI), but also represent the pinnacle of innovation and market capitalization.
SpaceX made its official debut on the Nasdaq-100 index on July 7, following a rule change that expedited its inclusion. However, since its addition, the market has seen some volatility: the S&P 500 has declined 2%, the Nasdaq-100 is down 7%, and SpaceX stock itself has experienced a significant 25% drop.
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Most of the Magnificent Seven companies have recently unveiled their earnings reports, with Nvidia's report anticipated on August 26. SpaceX is also gearing up to release its own on August 4.
During its initial public offering (IPO), Elon Musk and the SpaceX leadership initially aimed to raise $75 billion. However, overwhelming demand led underwriters to exercise their overallotment, ultimately allowing SpaceX to raise an impressive $86 billion. This robust IPO brought the company's total valuation to an astounding $2 trillion, signaling strong market confidence that SpaceX belongs among the world's leading tech powerhouses.
But does this valuation align with its underlying fundamentals? Let's delve deeper into how SpaceX truly stacks up against the Magnificent Seven.
Is SpaceX Just Getting Started?
A key distinction is SpaceX's size in terms of sales compared to its peers. While it commands a similar market value, its sales figures are considerably smaller, leading to the conclusion that it carries a much higher valuation multiple. This is clearly reflected in its price-to-sales (P/S) ratio.
| Company | TTM Sales | Price-to-Sales ratio | Most Recent Quarterly Sales Growth |
|---|---|---|---|
| SpaceX | $19 billion | 77 | 15% |
| Apple | $451 billion | 11 | 16% |
| Nvidia | $253 billion | 19 | 85% |
| Alphabet | $446 billion | 9 | 24% |
| Microsoft | $318 billion | 11 | 18% |
| Amazon | $743 billion | 3 | 20% |
| Meta | $215 billion | 6 | 28% |
| Tesla | $104 billion | 11 | 26% |
Data sources: Company filings, YCharts, Yahoo Finance. Growth is year over year. TTM = trailing-12-month.
SpaceX currently trades at an exceptionally high valuation and, paradoxically, isn't demonstrating faster growth than its larger counterparts. Investors, however, appear to be betting on SpaceX as the future, anticipating immense growth and earnings potential. Analysts at Goldman Sachs project a 100-fold increase in AI revenue by 2030, while Morgan Stanley analysts foresee SpaceX achieving a staggering $3.4 trillion in revenue by 2040. Wall Street analysts expect SpaceX to hit $39 billion in sales by 2026 and $73 billion the following year, which implies an 87% increase, a growth rate comparable to Nvidia's recent stellar performance.
Cash Burn and Path to Profitability
Unlike the consistently profitable Magnificent Seven stocks, SpaceX is currently operating at a loss. While its Starlink satellite broadband division has achieved positive net income, the company reported a total net loss exceeding $4 billion in the first quarter of 2026. It's worth noting that Elon Musk's other major public venture, Tesla, also endured a prolonged period of unprofitability before achieving consistent earnings, demonstrating his track record of turning nascent, cash-intensive businesses into profitable enterprises.
Wall Street is already anticipating a return to profitability for SpaceX, with an average analyst consensus targeting earnings-per-share (EPS) of $0.08 for the third quarter. While a full-year loss of approximately $0.55 per share is projected, analysts expect a positive EPS of around $0.65 in 2027.
Long-Term AI Opportunity
With the acquisition of xAI earlier this year, SpaceX now operates across three distinct business segments: rocket launching, Starlink satellite broadband, and AI. While many investors are captivated by the company's ambitious space endeavors, SpaceX itself identifies its most substantial opportunities within the AI sector. The company estimates its total addressable market at $28.5 trillion, with a staggering $26.5 trillion attributed to AI. The recent acquisition of Cursor, a rapidly expanding AI coding firm, is expected to introduce a significant new revenue stream, details of which investors eagerly await in the upcoming August 4 quarterly update.
However, most of the Magnificent Seven companies also possess substantial AI opportunities, meaning SpaceX doesn't hold a unique advantage in this arena. Each tech giant approaches AI differently; Apple integrates it into its iPhones and devices, while Nvidia provides the crucial chips and hardware fueling AI development. SpaceX might be competitive here, but its long-term standing remains to be seen. Its large language model, Grok, is gaining traction, but it faces stiff competition from established rivals such as OpenAI's ChatGPT, Alphabet's Gemini, and Anthropic's Claude.
While SpaceX shows promising aspects when compared to the Magnificent Seven, the enduring success of these tech titans is built on a proven track record. SpaceX has yet to demonstrate this long-term stability. The market will undoubtedly scrutinize its performance over time, and if it fails to meet the high expectations, it risks falling significantly behind the established tech giants.
