AI and space: two increasingly connected investment themes
SpaceX’s initial public offering (IPO) was a landmark moment for many investors, opening up a new galaxy of opportunities.
Its historic June debut saw the space exploration company valued at $1.77 trillion at its IPO and its share price surging by 50% in the first three days of trading. .
SpaceX’s (NASDAQ:SPCX) share price has fallen back since, but the appetite for space investing is only ramping up, with investors having more ways to access the sector than ever before.
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Opportunities to invest in space are being fuelled by the ongoing artificial intelligence (AI) boom.
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“Old space put humans on the Moon. New space is building the commercial infrastructure of the global economy,” said Mark Boggett, CEO of space tech investment firm Seraphim Space. “The convergence of AI and space tech, together with rising demand for connectivity, defence and sovereign capability, is creating one of the most compelling investment opportunities of the coming decade.”
How SpaceX and Nvidia are joining space and AI
It’s tempting to think of artificial intelligence (AI) and space as two separate themes, but they are increasingly closely linked.
SpaceX, for example, is largely an AI company since it merged with xAI, Elon Musk’s AI company and maker of the Grok LLM suite, earlier this year. SpaceX identified a $28.5 trillion total addressable market in its IPO prospectus, of which $26.5 trillion was attributed to AI – compared to $1.6 trillion for satellite connectivity and $370 billion for space launch services, which have historically been the pillars of SpaceX’s business.
One of the most visible crossovers between the space and AI themes is the concept of the orbital data centre – essentially, a data centre in space. These don’t exist yet, but they may not be far away: Starcloud, a start-up dedicated to making orbital data centres a reality, raised $250 million at a $2.3 billion valuation in August.
Among the list of investors in Starcloud’s latest investment round are tech hardware giants Nvidia and Cisco.
“Orbital data centres have gone from science fair to a funded race in a matter of months, with Nvidia neatly hedging both sides by backing Starcloud and SpaceX’s rival Starmind,” said James Lockyer, research analyst at investment bank Peel Hunt said.
Nvidia especially is increasingly central to the space industry’s designs. Colette Kress, the company’s chief financial officer, confirmed at Nvidia’s Q2 earnings call that SpaceX is among a number of leading partners that the firm’s latest generation of chip, Vera CPU, is being shipped to.
Nvidia also holds a stake in SpaceX via an earlier investment into xAI.
“The chip cycle and the space cycle are fusing,” said Lockyer. “Nvidia funding, supplying, and holding equity in SpaceX ties the single most valuable name in AI to the most valuable name in space, and for investors it makes SpaceX a compute story as much as a launch one.”
How to invest in the new space economy
As the space industry develops, investors have greater access than ever before. While SpaceX is the largest company in the space sector and is readily available to buy since its IPO, other stocks such as Rocket Lab (NASDAQ:RKLB) and AST SpaceMobile (NASDAQ:ASTS) offer space exposure too.
Companies like these can be accessed through thematic exchange-traded funds (ETF), such as the WisdomTree Space Economy UCITS ETF (LON:WSPG) or the Seraphim New Space UCITS ETF (LON:SERA), which launched on 2 September.
Seraphim New Space UCITS ETF is based on the Seraphim New Space Index, which identifies and weights companies across various components of the space investment ecosystem. Its representative holdings include SpaceX, as well as companies like space infrastructure company Intuitive Machines (NASDAQ:LUNR) or BlackSky (NYSE:BKSY) which offers “space-based intelligence” by using AI and machine learning to instantly analyse imagery captured from satellites.
The ETF also holds a position in Seraphim Space Investment Trust (LON:SSIT), which gained 56% in 2026 through to 28 August. Unlike the ETF, which will mostly hold publicly-listed companies, Seraphim’s investment trust mostly holds private companies related to the space economy.
