SpaceX Stock Forecast: Musk Says AI Could Account for 99% of Valuation in Five Years, How Much Higher Can SPCX Stock Rise?
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Elon Musk projects that AI could comprise 99% of SpaceX’s company value within five years, driven by massive computing capacity expansion and strategic acquisitions. Second-quarter revenue surged 92% year-over-year, bolstered by rapid AI growth. Despite heavy infrastructure expenditures presenting execution risks, Wall Street remains optimistic, with price targets reaching up to $800. Morgan Stanley highlights significant upside potential, noting the market undervalues SpaceX's end-to-end AI platform. Technically, the stock has broken above its downtrend line and 20-day moving average, signaling strengthening momentum with key resistance near the $150 Fibonacci level and support at $133.
TradingKey - Elon Musk recently stated at an internal SpaceX (SPCX) all-hands meeting that within the next five years, the AI business could account for about 99% of SpaceX's company value, at which point SpaceX's overall valuation will reach an "astronomical figure." This means that in Musk's plan, SpaceX will no longer be merely an aerospace company relying on rocket launches and Starlink business growth, and AI is expected to become a new core growth engine.
This shift has already begun to show in its financial performance. SpaceX's second-quarter revenue reached $7.814 billion, up 92% year-over-year, with AI business revenue of about $2.6 billion, up 213% quarter-over-quarter and 247% year-over-year. Musk also expects AI revenue to surpass all other SpaceX businesses as early as September this year, and further expand its lead in the fourth quarter. If this goal is achieved, AI will become SpaceX's largest revenue source for the first time.
What truly deserves market attention is that Musk's goal is not merely to make AI an additional business for SpaceX, but rather to redefine the company's business model.
Traditionally, SpaceX built its revenue foundation primarily on rocket launches, spacecraft, and Starlink, but today the company is gradually connecting AI models, computing power, cloud services, satellite communications, and even future space infrastructure.
SpaceX has announced the acquisition of AI coding tool Cursor for about $60 billion and disclosed cloud service contracts totaling approximately $14.1 billion in its second-quarter earnings report. Meanwhile, the company continues to expand its AI computing capacity and plans to further advance orbital AI computing.
Musk revealed that the company's current AI computing capacity is about 1.4 gigawatts, expected to exceed 2 gigawatts by the end of this year, with plans to expand to about 10 gigawatts by the end of 2027. According to his estimates, if 10 gigawatts of computing capacity comes online and is calculated at $30 to $50 per watt annually, the related business could generate $300 billion to $500 billion in annual revenue in the future.
SpaceX's AI ambitions do not stop at terrestrial data centers either; Musk proposed that while AI training will still be completed mainly on Earth in the future, inference tasks could gradually shift to space.
Of course, there remains a significant execution gap between this goal and reality. A capacity of 10 gigawatts means SpaceX will need to expand massively in chip procurement, power supply, thermal management, data center construction, and capital expenditures. The company invested heavy funds into building AI infrastructure in the second quarter, which was one of the key reasons for the market's cautious reaction to SpaceX's financial results previously.
Wall Street Bets on SpaceX AI Potential With Price Target Up to $800
At present, overall market expectations are also relatively optimistic. Based on forecasts from 31 Wall Street analysts over the past three months, the average 12-month price target for SpaceX is $231.15, about 58% higher than the latest stock price of $146.15; the highest price target reaches $800, while the lowest is $75.
Source: TipRanks
Morgan Stanley (MS) noted in its latest research report on August 10 that although SpaceX's stock price has recently gained over 25% cumulatively, the market's valuation of its AI business remains relatively conservative, meaning there is still significant upside potential for the company's stock price. Morgan Stanley set a base price target of $300, representing a potential upside of over 100% from the current stock price of around $140, while in the most optimistic bull-case scenario, the target price could reach as high as $600, corresponding to a potential gain of nearly 350%.
Morgan Stanley believes that the market is currently still pricing SpaceX's AI business largely according to the logic of an emerging cloud service provider, which has not yet fully reflected the potential of the end-to-end AI platform it is building.
SpaceX Stock Price Technical Analysis
Source: TradingView
On the daily chart, SPCX is flashing a clear technical strengthening signal. The stock recently closed at $146.15, up 9.65% for the day, not only breaking above its previous downtrend line but also reclaiming its 20-day moving average at $121.22. Volume expanded significantly that day, indicating that the rally is supported by capital inflows and improving the credibility of the breakout.
Regarding momentum indicators, the 14-day RSI rose to 58.25, entering bullish territory, but it still has room before reaching the overbought line of 70, suggesting short-term upside momentum has not been fully exhausted. However, the stock price is currently approaching the 0.382 Fibonacci retracement level of around $150, which will be the first key resistance level to confirm a reversal.
If SPCX can break through and consolidate above $150 on heavy volume, the subsequent targets will be $165 and $180, representing potential upside of approximately 13% and 23% respectively from $146.15.
On the downside, initial support is at $133; if the stock holds this level during a pullback, the overall price action can still be regarded as a normal consolidation after a breakout. A more critical medium-term support lies near the 20-day moving average at around $121.22. If the stock falls back below this region, the reversal signal will weaken significantly, and it may retest the low of $104.25.
This content was translated using AI and reviewed for clarity. It is for informational purposes only.
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