SpaceX's AI Compute Bet Takes Off as Google Deal Kicks In and Analysts Chase $300 Targets

SpaceX's Alphabet data center partnership is live, adding to a $1.25B monthly Anthropic contract; shares rose 7.2% to EUR 141.20.

SpaceX has quietly crossed a threshold that has little to do with rocket exhaust. As of the start of October, the company's multibillion-dollar data center partnership with Google parent Alphabet is officially live — a milestone that, combined with an existing contract with AI firm Anthropic worth $1.25 billion per month, funnels roughly $2.2 billion in monthly AI-related revenue into the company's coffers.

Investors took notice. The stock closed Friday's European session at EUR 141.20, a gain of 7.2 percent on the day, with media reports crediting a run of successful rocket launches in recent days for lifting sentiment around the space company. The market, it seems, is no longer pricing SpaceX as a pure launch provider but as a linchpin of orbital infrastructure and next-generation technology projects.

Hardware Ties to Nvidia Add Fuel

Momentum in the segment is being reinforced on the hardware side. Elon Musk has publicly signaled close cooperation with semiconductor maker Nvidia, with SpaceX developing a customized variant of Nvidia's VR72 system through a co-design effort. The unit is aimed at high-density data center installations and, according to Musk, could deliver average performance of nearly 250 kilowatts.

Market watchers view the pairing of orbital connectivity with AI compute capacity as a key driver of the company's future revenue profile — and as a pillar supporting its valuation.

A Launch Cadence That Speaks for Itself

Operationally, SpaceX has been firing on all cylinders. Three Falcon rockets were dispatched successfully within a 13-hour window, a tempo that underscores the company's industrial-scale execution. The recent manifest has been varied: four astronauts were ferried to the International Space Station under NASA's Crew-13 mission, a Falcon 9 carried 130 payloads to orbit on the rideshare flight Transporter-18, and a Falcon Heavy lofted the NROL-97 reconnaissance satellite for the U.S. National Reconnaissance Office.

The most consequential cargo, though, may be the least visible. Aboard Transporter-18 was a prototype satellite for Google's Project Suncatcher, designed to begin testing an orbital AI computing concept. That experiment, in the eyes of many observers, marks a shift in how the business model is perceived: SpaceX is transforming from a freight carrier into an indispensable enabler of cloud and AI infrastructure in near-Earth space. If orbital computing takes hold as a new asset class, the revenue potential stretches well beyond traditional transport budgets.

Starship's Bumpy Path Doesn't Shake Confidence

Euphoria in the markets has proven resilient even in the face of technical hurdles. On September 28, Starship reached Earth orbit for the first time and deployed 26 Starlink satellites — though the flight ended early after a premature engine failure, and the vehicle tipped over and caught fire after splashdown.

Traders appear to be treating such episodes as calculated development steps rather than fundamental setbacks. Macquarie offered a case in point: on September 30, according to a Reuters report, the firm reaffirmed its "Outperform" rating and a $250 price target, citing AI-related agreements and the partial success of the Starship orbital flight. The confidence looks justified given the breakneck development pace management is sustaining — one that competitors are struggling to match.

Telecom Pushback and a Government Backstop

Not every signal is green. AT&T CEO John Stankey said on September 29 that a potential Starlink strategy for phone and internet services is not viable, arguing a satellite service cannot prevail against fiber. The critique lands on a sensitive spot: Starlink must prove in the mass market that it can compete economically with terrestrial networks.

Against that, SpaceX retains a sturdy revenue base from government customers. NASA awarded a $946 million contract on September 18 for three additional crewed ISS flights running through 2030, and an agreement with Exolaunch dated September 21 covers payload integration for a Starfall mission aboard Starship in 2029.

Where the Analysts Stand

Sell-side interest in the satellite-plus-AI combination is running hot. Morgan Stanley sees substantial headroom in the new revenue streams and carries a $300 price target, pointing to the Google and Anthropic contracts alongside plans to integrate new software solutions into the existing satellite network. At ARK Invest, futurist Brett Winton highlights the leverage embedded in future transport capacity: by the firm's calculations, each Starship flight could generate more than $700 million in additional annual revenue.

The task ahead is execution. SpaceX must now deliver the promised compute capacity reliably. Should the Nvidia systems mesh technically with the demands of cloud customers, the company stands to cement a role extending well past the classic transport business.

Despite the recent surge, the shares remain 27 percent below their 52-week high of EUR 194.46 — a gap that leaves room for the bull case to run, provided the technological lead holds. Reliable multibillion-dollar NASA orders, an unmatched launch frequency and emerging fields like orbital AI infrastructure together form a compelling fundamental foundation. So long as SpaceX keeps its edge, operational stumbles in the Starship program are likely to be read on Wall Street as temporary buying opportunities rather than reasons to retreat.