SpaceX (SPCX) shares advanced more than 1.5% on Thursday, trading near $153, even as the broader market retreated under pressure from a sharp rise in Treasury yields. The S&P 500 slipped 0.2%, the Nasdaq Composite edged down 0.1%, and the Dow Jones Industrial Average fell 215 points, or 0.1%.
The market-wide decline was fueled by a surge in long-term borrowing costs. The 10-year Treasury yield hit an intraday high of 5.342%, its highest level since April 2002, while the 30-year yield climbed to 5.663%, also near levels not seen in roughly 24 years. Higher yields typically weigh on growth-oriented equities, but SpaceX bucked the trend, buoyed by a series of AI-related developments.
Google's Orbital AI Test
A key catalyst was Alphabet's plan to launch its homegrown AI chips into orbit aboard a SpaceX Falcon 9 rocket on Thursday. The uncrewed Transporter-18 mission, scheduled for approximately 11:15 a.m. PT from Vandenberg Space Force Base in California, will carry Planet Labs satellites, including a solar-powered prototype equipped with Google's tensor processing units (TPUs).
This marks the first in-orbit test for Project Suncatcher, a "moonshot" initiative Alphabet unveiled in November 2025. The project aims to develop solar-powered AI computing infrastructure capable of operating continuously in space, potentially offering an alternative to Earth-based data centers, which face challenges such as power availability, land constraints, and community opposition.
SpaceX's Own Orbital Data Center Ambitions
SpaceX is also advancing its own plans for orbital data centers. The company intends to deploy swarms of satellites equipped with graphics processing units and solar arrays. CEO Elon Musk has suggested that space-based data centers could become the cheapest way to train AI within several years. COO Gwynne Shotwell said in September that the company expects to launch "supercompute in space" in 2027.
Alphabet is a significant investor in SpaceX, with its stake currently valued at more than $82 billion. The two companies are partners in space infrastructure while competing in parts of the broader AI market.
TD Cowen's Bullish Outlook
The AI-computing opportunity is increasingly central to the investment case for SpaceX. TD Cowen analysts, led by John Blackledge, initiated coverage earlier this week with a Buy rating and a $200 price target, describing computing as the company's "biggest near-term driver" of revenue. The brokerage expects roughly 35% of SpaceX's 2026 sales to come from activities linked to selling computing power.
TD Cowen sees the computing business potentially overtaking Starlink, which it calls SpaceX's "crown jewel," as early as the first quarter of 2027. The firm forecasts AI compute leasing to account for roughly 60% of SpaceX revenue in 2027 and 65% by 2028. It also projects SpaceX revenue to grow at a compound annual rate of 62% between 2026 and 2031, with nearly 1,000 low-Earth-orbit launches by 2031. Blackledge expects close to half of SpaceX's planned computing capacity to be leased to external companies over the next several years.
The combination of Google's orbital AI test and TD Cowen's optimistic projections helped SpaceX outperform the broader market, even as rising yields pressured other stocks. Investors are increasingly viewing SpaceX as a key player in the emerging space-based AI infrastructure sector.
This article is for informational purposes only and does not constitute financial advice.
