Starlink is the part of spaceX making money. Selling a low latency global communications capability is a sound business model. The rocketry part is close to break even. I suspect it could do with a few more launches that weren’t starlink.
It’s xAI that’s tanking the whole thing. Without that SpaceX would be profitable. With it, it’s a trash stock.
The business model is armament. Future warfare uses land and air drones and they require network access, which Starlink provides and they’re much more difficult to jam than ground-based network facilities.
And he played his hand too soon in Ukraine: by deciding for himself to reject Ukrainian coverage in Crimea. This creates an opening for competitors that only war can afford to duplicate.
Yeah. Are they really expecting me to believe we can‘t have wide spread fiber that has fairly little maintenance costs but we can totally afford weekly space rocket launches to maintain Starlink? And Starlink is supposed to be an affordable option while still being profitable? Yeah, sure buddy. Totally doesn‘t sound like a hyperloop-esque pipe dream. /s
But basically it’s a subscription service which they can sell around most of the planet and compete with infrastructure heavy services (as in expensive to replace them). They also have a lot of enterprise customer usecases (like agriculture and construction) as well as cashcow government (army).
Their growth is actually massive compared to last year, and starlink itself is already profitable. Their economy gets better with the investment in the rocket tech. Starship will be able to lift 20x the amount of starlink than falcon 9, apparently also cheaper, while the next gen starlink sats will also be able to serve a lot more customers. That’ll drive their operating cost down, while allowing selling more.
(Just to be clear, spacex as a company is still hot garbage because of the bundling of x and xai and also probably the control structure giving musk all the power while not even holding majority stake, the above is just about starlink and the rocket tech.)
The problem with Starlink is it’s only ever a niche service. There’s a limit to how many satellites you can have in the sky over paying subscribers (as opppsed to, say, deserts or oceans) - I did some back of the envelope maths that put it at about 15 million subscribers with acceptable speeds, maybe double that with terrible service.
By comparison, Deutsche Telekom in Germany alone has 5 times as many mobile subscribers, and a similar number of fixed-line broadband. Amd best of all, Deutsche Telekom doesn’t need to replace all its infrastructure every 5 years when it falls to Earth.
So on what possible basis does Starlink warrant a “to the moon” valuation, and traditional providers don’t? Traditional providers can serve more consumers, at lower cost, with better return on assets…
Starlink, and batshit ideas about datacentres in space, exist for one reason: US infrastructure is complete shit. It would almost certainly be long-run a better investment to fix the power, water, and telecomms infrastructure on the ground, but right now you have a government that would rather private companies fire money into space than pay taxes.
I don’t disagree that even starlink is overvalued, my point was that it’s the only thing in spacex bringing in profit and why.
FWIW, their v3 satellite model is apparently a 10x bandwidth increase over v2 (although weights about 5x as much). At the moment they are so oversubscribed that they can charge a $1000 surcharge for people to just sign up in some areas, so there’s definitely demand. So given they’re already around 10 mill subscribers there is some growth to be had (although I agree it won’t be 100s of millions, maybe a few 10s - far from the 50+ multiplier on the valuation, even ignoring the other 2 money pits bundled in)
That being said, you’re entirely correct that fixing the on-ground infrastructure is a much better investment if the goal is good internet service and would deliver a better quality service for cheaper, but that is happening extremely slowly in most of the developed countries (e.g. UK has terrible internet infra as well), especially in rural areas. So for the next 10 years starlink doss have a large market because the ground infrastructure sucks, and it’s not “hype” to spend money on it for investors where’s space stuff is.
From this article from early 2025, we get a median life for Starlink satellites of 5.3 years, though expected to improve with newer versions of the satellites.
From other more broad analysis of the life expectancy of low orbit satellites we get that the solar cycle - which is 11 years - means that at its peak many more such satellites die due to the Earth’s athmosphere expanding (so the satellites are more impacted by athmospheric drag hence are less likely to manage to remain in orbit, which they do using engines which have limited propellant). This is in addition to normal hazards of space, such as failures due to solar activity.
So expect that even for the lastest generation, half-life of these satellites is between 5 to at best 11 years.
Deutsche Telekom does not have the capital costs of replacing half its network every 5 - 11 years.
For Starlink and SpaceX, I can probably understand the business model, considering the race to getting more satellites to orbit be it for surveying or in case of Starlink stable Internet anywhere. But anything beyond that, like data centers in space I just ridiculous. No way that their valuation is anywhere near what it is realistically.
Starlink is basically a military tech that is too expensive even for the US military, so it was sold to gullible investors as a great deal… It won’t ever be profitable, at least not near the level that was promised. But it might turn out to be essential during a few wars.
GPS was planned out and deployed over 20 years (from proposal to operational).
It was also designed and worked for its intended purpose with only 24 satellites.
Block III gps satellites are designed to last 15 years and there are 10 of them.
Starlink is disposable chains of 1,000s of satellites that will be constantly burning up in the atmosphere and replaced at huge costs, including co2 from the launches.
I don’t think it’s the same, we already have the infrastructure for the network in most places with a dense population. Existing infrastructure is of the similar quality to Starlink, and the maintenance cost for the existing infrastructure is lower.
In case of GPS, the infrastructure existing before was much worse.
The only cases I can think of, where Starlink outperforms the existing infrastructure are:
Areas with low population density - the problem, in those areas, by definition, there aren’t many customers
Situation when someone is actively trying to sabotage the existing infrastructure, like those ships, that are breaking underwater internet cables, or the active jamming near the front lines - what happens in the Ukraine shows that Starlink is great for that case. It is enough to treat it as strategically important, but it doesn’t justify the starlink valuation. I really hope this market won’t grow much.
Countries that refuse to guarantee fiber to every home so you’re not getting it unless the gods (Telia in the case of Estonia) decide you should get it.
I look at Starlink where currently about 6 spacecraft deorbit a week and need replacement as a huge operational cost. Many SpaceX launches are Starlink launches, it raises the question of whether this is a circular or self fulfilling industry.
An analysis from early 2025 showed that the median life expectancy of a 1st generation Starlink satellite was 5.3 years, though expected to improve in v2 and v3.
Beyond that, the solar lifecycle means that every 11 years the earth’s orbit expands increasing drag on low-orbit satellites (which brings them down) as well as bombarding them with more radiation (increasing the likelihood of failures).
Other sources I’ve found in searching for it give their median life-expectancy as being 5-7 years.
Land-based telecom operators don’t have to replace pretty much all of their transmission infrastructure - worse, in a costly to access location - more than once a decade.
Space-based tele-communications is more than proven as a viable business model, what’s nowhere near proven (or anywhere close to being mathematically demonstrable) is one single operator of those being worth more than many major land-based telecom operators each with many times the number of customers of that space-based telecoms business and providing much faster network access (somebody else gave Deutsche Telecomm as an example) put together.
(How exactly in terms of actual PHYSICS will Starlink deliver via radio waves to for example all 245 million European households - necessary to justify such valuations - a reliable 1Gbps connection for €10/month needed to to beat the land operators?)
SpaceX’s IPO valuation which itself is mostly anchored on Starlink, is totally unjustified and unjustifiable by fundamentals.
Unless you want to separate starlink from spacex it’s kinda the other way around.
I think spacex was adding starlink deployment to all their rockets and their “plan” was to launch other satellites and nasa projects, then get the starlink stuff up there for less.
Its actually a great business model as they need to do actual test flights to build better rockets and instead of that being pure R&D expenses, its supplemented by launching Starlink satellites which generate their own revenue for the company.
Great theory, but the Falcon 9 is already a proven design and most of SpaceX’s R&D is going to the starship, which uses completely different engines and which has blown up or disintegrated just as much as its successfully gotten above the atmosphere. It’s also never actually completed an orbit or delivered a gram of anything to orbit.
Starlink is a useful tool to boost launch numbers precisely so investors think things are better than they actually are. Originally SpaceX burned through government and private investor money. Now that they’ve blown through the entire Artemis budget the interim director of nasa gave them through blatant corruption, and launched even more billion dollar fireworks using private investor money, they are desperately trying to convince the public for more fireworks funds.
The entire valuation is that they say that they can find $28T of businesses on mars and the moon, that that creating these business ideas is something they can do repeatably.
To be fair, you’re only a moron if you are considering it a “hold forever” stock. If you get out in time, or even if you miss-time it, that’s just gambling, which only makes you a moron if you can’t afford the loss.
The water utility for my country’s capital is a publicly traded company for some reason. The only way they’re going out of business is if people stop using water or water stops existing in the area.
That can honestly be considered a forever stock as far as I can tell. Dividends aren’t super high but that’s because they’re constantly saving up half the profit for future infra work.
Depends on the company. Some asset heavy companies (think railroads, commercial REITs) pay steady dividends, and are extremely unlikely to just go under without warning.
Starlink is massively profitable, look at their balance sheets. It’s very simple, their users pay them a lot of money to access the internet. Far, far more than the launch costs to maintain the constellation.
Their defense launch business is also profitable, though I haven’t checked how much.
The Starship development and stupid acquisitions (xai) have been a money pit though.
I don’t think that’s quite true. (Happy to be proven wrong if somebody has better numbers than me.)
From what I can see the launch business generated $4.1 billion, but profits in that segment are negative because the $3 billion in Starship development costs are lumped in to that. The overall loss (-$600 million) would instantly turn into great profit if they decided to give up on Starship.
But for sure, xAi is a nightmare. Absolutely Elon trying to bail himself out again.
The best numbers I can find are from 2024, when Starlink made a total of $72 million in profit.
Not great numbers though, as the article explains. It only talks about the cost of the end user hardware and providing the service, so the profit is against those expenses. It doesn’t factor in the cost of launches and satellites.
I understand the business pretty well, my issue is where the money is coming from to pay for it the huge costs. It may be there are enough users to sustain it and at what point will it saturate and stagnate?
SpaceX’s annual capital expenditures quintupled in two years, hitting $20.7 billion in 2025, fueled by simultaneous Starship launch infrastructure and AI data center buildouts.
Reusable vehicles meant something like 1/20 the per-launch costs of the pre-existing competition? No matter what you want to pay to have put in space, the supplier who reuses equipment will have a huge advantage.
And starlink? Satellite internet access for remote properties used to have all the latency of a return trip to geostationary orbit. Starlink is a massive advantage compared to that.
Never understood the business model for SpaceX and Starlink. Huge capital and operational costs without a clear understanding of who is paying for it.
Starlink is the part of spaceX making money. Selling a low latency global communications capability is a sound business model. The rocketry part is close to break even. I suspect it could do with a few more launches that weren’t starlink.
It’s xAI that’s tanking the whole thing. Without that SpaceX would be profitable. With it, it’s a trash stock.
The business model is armament. Future warfare uses land and air drones and they require network access, which Starlink provides and they’re much more difficult to jam than ground-based network facilities.
And he played his hand too soon in Ukraine: by deciding for himself to reject Ukrainian coverage in Crimea. This creates an opening for competitors that only war can afford to duplicate.
Yeah. Are they really expecting me to believe we can‘t have wide spread fiber that has fairly little maintenance costs but we can totally afford weekly space rocket launches to maintain Starlink? And Starlink is supposed to be an affordable option while still being profitable? Yeah, sure buddy. Totally doesn‘t sound like a hyperloop-esque pipe dream. /s
Stsrlink is about the only thing in the company pulling in solid revenue. There’s a good analysis on https://newspaceeconomy.ca/2026/05/30/what-is-starlinks-financial-performance
But basically it’s a subscription service which they can sell around most of the planet and compete with infrastructure heavy services (as in expensive to replace them). They also have a lot of enterprise customer usecases (like agriculture and construction) as well as cashcow government (army).
Their growth is actually massive compared to last year, and starlink itself is already profitable. Their economy gets better with the investment in the rocket tech. Starship will be able to lift 20x the amount of starlink than falcon 9, apparently also cheaper, while the next gen starlink sats will also be able to serve a lot more customers. That’ll drive their operating cost down, while allowing selling more.
(Just to be clear, spacex as a company is still hot garbage because of the bundling of x and xai and also probably the control structure giving musk all the power while not even holding majority stake, the above is just about starlink and the rocket tech.)
The problem with Starlink is it’s only ever a niche service. There’s a limit to how many satellites you can have in the sky over paying subscribers (as opppsed to, say, deserts or oceans) - I did some back of the envelope maths that put it at about 15 million subscribers with acceptable speeds, maybe double that with terrible service.
By comparison, Deutsche Telekom in Germany alone has 5 times as many mobile subscribers, and a similar number of fixed-line broadband. Amd best of all, Deutsche Telekom doesn’t need to replace all its infrastructure every 5 years when it falls to Earth.
So on what possible basis does Starlink warrant a “to the moon” valuation, and traditional providers don’t? Traditional providers can serve more consumers, at lower cost, with better return on assets…
Starlink, and batshit ideas about datacentres in space, exist for one reason: US infrastructure is complete shit. It would almost certainly be long-run a better investment to fix the power, water, and telecomms infrastructure on the ground, but right now you have a government that would rather private companies fire money into space than pay taxes.
I don’t disagree that even starlink is overvalued, my point was that it’s the only thing in spacex bringing in profit and why.
FWIW, their v3 satellite model is apparently a 10x bandwidth increase over v2 (although weights about 5x as much). At the moment they are so oversubscribed that they can charge a $1000 surcharge for people to just sign up in some areas, so there’s definitely demand. So given they’re already around 10 mill subscribers there is some growth to be had (although I agree it won’t be 100s of millions, maybe a few 10s - far from the 50+ multiplier on the valuation, even ignoring the other 2 money pits bundled in)
That being said, you’re entirely correct that fixing the on-ground infrastructure is a much better investment if the goal is good internet service and would deliver a better quality service for cheaper, but that is happening extremely slowly in most of the developed countries (e.g. UK has terrible internet infra as well), especially in rural areas. So for the next 10 years starlink doss have a large market because the ground infrastructure sucks, and it’s not “hype” to spend money on it for investors where’s space stuff is.
It gets even worse.
From this article from early 2025, we get a median life for Starlink satellites of 5.3 years, though expected to improve with newer versions of the satellites.
From other more broad analysis of the life expectancy of low orbit satellites we get that the solar cycle - which is 11 years - means that at its peak many more such satellites die due to the Earth’s athmosphere expanding (so the satellites are more impacted by athmospheric drag hence are less likely to manage to remain in orbit, which they do using engines which have limited propellant). This is in addition to normal hazards of space, such as failures due to solar activity.
So expect that even for the lastest generation, half-life of these satellites is between 5 to at best 11 years.
Deutsche Telekom does not have the capital costs of replacing half its network every 5 - 11 years.
For Starlink and SpaceX, I can probably understand the business model, considering the race to getting more satellites to orbit be it for surveying or in case of Starlink stable Internet anywhere. But anything beyond that, like data centers in space I just ridiculous. No way that their valuation is anywhere near what it is realistically.
Starlink is basically a military tech that is too expensive even for the US military, so it was sold to gullible investors as a great deal… It won’t ever be profitable, at least not near the level that was promised. But it might turn out to be essential during a few wars.
Starlink is the only thing making SpaceX profitable right now though
While you’re probably right, I wonder if we would’ve said the same thing about GPS
GPS was planned out and deployed over 20 years (from proposal to operational).
It was also designed and worked for its intended purpose with only 24 satellites.
Block III gps satellites are designed to last 15 years and there are 10 of them.
Starlink is disposable chains of 1,000s of satellites that will be constantly burning up in the atmosphere and replaced at huge costs, including co2 from the launches.
I don’t think it’s the same, we already have the infrastructure for the network in most places with a dense population. Existing infrastructure is of the similar quality to Starlink, and the maintenance cost for the existing infrastructure is lower.
In case of GPS, the infrastructure existing before was much worse.
The only cases I can think of, where Starlink outperforms the existing infrastructure are:
Areas with low population density - the problem, in those areas, by definition, there aren’t many customers
Situation when someone is actively trying to sabotage the existing infrastructure, like those ships, that are breaking underwater internet cables, or the active jamming near the front lines - what happens in the Ukraine shows that Starlink is great for that case. It is enough to treat it as strategically important, but it doesn’t justify the starlink valuation. I really hope this market won’t grow much.
I look at Starlink where currently about 6 spacecraft deorbit a week and need replacement as a huge operational cost. Many SpaceX launches are Starlink launches, it raises the question of whether this is a circular or self fulfilling industry.
An analysis from early 2025 showed that the median life expectancy of a 1st generation Starlink satellite was 5.3 years, though expected to improve in v2 and v3.
Beyond that, the solar lifecycle means that every 11 years the earth’s orbit expands increasing drag on low-orbit satellites (which brings them down) as well as bombarding them with more radiation (increasing the likelihood of failures).
Other sources I’ve found in searching for it give their median life-expectancy as being 5-7 years.
Land-based telecom operators don’t have to replace pretty much all of their transmission infrastructure - worse, in a costly to access location - more than once a decade.
Space-based tele-communications is more than proven as a viable business model, what’s nowhere near proven (or anywhere close to being mathematically demonstrable) is one single operator of those being worth more than many major land-based telecom operators each with many times the number of customers of that space-based telecoms business and providing much faster network access (somebody else gave Deutsche Telecomm as an example) put together.
(How exactly in terms of actual PHYSICS will Starlink deliver via radio waves to for example all 245 million European households - necessary to justify such valuations - a reliable 1Gbps connection for €10/month needed to to beat the land operators?)
SpaceX’s IPO valuation which itself is mostly anchored on Starlink, is totally unjustified and unjustifiable by fundamentals.
As far as I understood, I always thought that they just used other people’s rockets to piggyback their own satellites to space basically for free
Unless you want to separate starlink from spacex it’s kinda the other way around.
I think spacex was adding starlink deployment to all their rockets and their “plan” was to launch other satellites and nasa projects, then get the starlink stuff up there for less.
Haven’t heard that though you need a lot of other launches with space available….
Its actually a great business model as they need to do actual test flights to build better rockets and instead of that being pure R&D expenses, its supplemented by launching Starlink satellites which generate their own revenue for the company.
Great theory, but the Falcon 9 is already a proven design and most of SpaceX’s R&D is going to the starship, which uses completely different engines and which has blown up or disintegrated just as much as its successfully gotten above the atmosphere. It’s also never actually completed an orbit or delivered a gram of anything to orbit.
Starlink is a useful tool to boost launch numbers precisely so investors think things are better than they actually are. Originally SpaceX burned through government and private investor money. Now that they’ve blown through the entire Artemis budget the interim director of nasa gave them through blatant corruption, and launched even more billion dollar fireworks using private investor money, they are desperately trying to convince the public for more fireworks funds.
I suppose that it is that dependence upon Starlink to boost launch numbers makes me suspicious of the books. The whole thing just feels ponzie scheme.
It’s a FOMO play for morons.
The entire valuation is that they say that they can find $28T of businesses on mars and the moon, that that creating these business ideas is something they can do repeatably.
To be fair, you’re only a moron if you are considering it a “hold forever” stock. If you get out in time, or even if you miss-time it, that’s just gambling, which only makes you a moron if you can’t afford the loss.
No single stock should be a hold forever play (unless you count ETFs as a single stock)
A steady dividend stock might be a hold forever stock. Especially if you don’t want to realize the capital gains of the stock’s appreciation.
It’s one single stock for one company, there is still high risk of extreme losses over a very long time
The water utility for my country’s capital is a publicly traded company for some reason. The only way they’re going out of business is if people stop using water or water stops existing in the area.
That can honestly be considered a forever stock as far as I can tell. Dividends aren’t super high but that’s because they’re constantly saving up half the profit for future infra work.
Depends on the company. Some asset heavy companies (think railroads, commercial REITs) pay steady dividends, and are extremely unlikely to just go under without warning.
Starlink is massively profitable, look at their balance sheets. It’s very simple, their users pay them a lot of money to access the internet. Far, far more than the launch costs to maintain the constellation.
Their defense launch business is also profitable, though I haven’t checked how much.
The Starship development and stupid acquisitions (xai) have been a money pit though.
Starlink is the only part of SpaceX operations that turns a profit.
Rocket launches do not, and xAi is a bottomless money pit just like every other AI venture.
I don’t think that’s quite true. (Happy to be proven wrong if somebody has better numbers than me.)
From what I can see the launch business generated $4.1 billion, but profits in that segment are negative because the $3 billion in Starship development costs are lumped in to that. The overall loss (-$600 million) would instantly turn into great profit if they decided to give up on Starship.
But for sure, xAi is a nightmare. Absolutely Elon trying to bail himself out again.
The best numbers I can find are from 2024, when Starlink made a total of $72 million in profit.
Not great numbers though, as the article explains. It only talks about the cost of the end user hardware and providing the service, so the profit is against those expenses. It doesn’t factor in the cost of launches and satellites.
Generated 4.1 billion with a profit of how much?
And how much money did they get from the US government?
Lockheed Martin gets most of their money from the government and still manages to be profitable.
I don’t think Starlink includes their launch fees, leaving that on SpaceX side of the balance sheet. But I haven’t read details.
the business model today is to sell satellite internet
in rural areas, satellite internet is cheaper than cable internet if the distance to the nearest town is large enough.
I understand the business pretty well, my issue is where the money is coming from to pay for it the huge costs. It may be there are enough users to sustain it and at what point will it saturate and stagnate?
the market will saturate for sure but they charge each month so they keep making revenue nevertheless
yeah, and they’ve made billions off of it.
at this rate, it’ll only take a century or two to scratch the dent on the enormous costs!
have you actually looked at the numbers of cost and revenue, or are you just talking out of your ass?
reuters: SpaceX generated about $8 billion in profit on $15 billion to $16 billion of revenue last year
https://www.reuters.com/business/finance/spacex-generated-about-8-billion-profit-last-year-ahead-ipo-sources-say-2026-01-30/
SpaceX’s annual capital expenditures quintupled in two years, hitting $20.7 billion in 2025, fueled by simultaneous Starship launch infrastructure and AI data center buildouts.
https://finance.yahoo.com/sectors/technology/articles/eye-watering-sum-spacex-spent-124427519.html
but that debt # includes stopgap loans before the IPO
https://money.usnews.com/investing/news/articles/2026-04-23/exclusive-spacex-refinanced-debt-with-stopgap-20-billion-loan-before-ipo-filing
costs will only go up from here, so by all means, give musko some of your money. what could go wrong?
And doesn’t SpaceX now also own xAI and Xitter? He’s trying to offload his terrible investments.
Not Twitter. He only moved the AI over so he could attach it to something that could hide it’s losses (not very well).
Reusable vehicles meant something like 1/20 the per-launch costs of the pre-existing competition? No matter what you want to pay to have put in space, the supplier who reuses equipment will have a huge advantage.
And starlink? Satellite internet access for remote properties used to have all the latency of a return trip to geostationary orbit. Starlink is a massive advantage compared to that.
You’re not wrong, they were kinda burning money to create a business model. I’m a space fanboy though so I’m glad someone is doing it.
Pretty sad that musk is involved at all, but he started it. More sad that it now has the ai cancer stuck to it.
Still I want humans to go beyond earth and I guess I’m willing to let th devil do it