Elon Musk confirmed SpaceX will go public in 2026, reversing a
position he held for more than a decade.
The IPO could raise $30 billion in value of the company in 1.5
trillion, making it the largest public offering in history,
surpassing Saudi Aramco's $29 billion listing in 2019.
Musk had long insisted SpaceX would remain private until
rockets were flying regularly to Mars, arguing that public
shareholders would prioritize profits over his colonization
dreams. So why did he change his mind?
The answer involves data centers in space.
Musk plans to retrofit new generation Starling satellites
into orbital computing platforms that could power the AI
revolution, and he needs massive capital to make it happen.
Today, we're going to cover the technical specs of these space
data centers, the competitive race with Jeff Bezos and Google,
and what this means for Musk's Mars timeline.
Now, SpaceX confirmed the 2026 IPO after ours Technica reporter
Eric Berger published an analysis of why the company
would finally go public. Musk responded on X with four
words. As usual, Eric is accurate.
The company is currently conducting an insider share sale
at an $800 billion valuation, exactly double what SpaceX
commanded at its last capital raise in 2025.
And the core driver behind this reversal is a new business line
that would not exist when Musk first swore off public markets.
SpaceX wants to build orbital data centers using its Starlink
V3 satellites, which feature high speed laser links capable
of 1 terabit per second throughput.
Now, that number is 10 times the capacity of current Starlink V2
satellites. The V3 satellites require
Starship to launch because they are significantly larger, and
SpaceX plans to deploy 60 of them per flight starting in
2026. Unlike previous Starlink
generations optimized purely for communications, the V3 units are
being engineered as compute capable infrastructure with
larger solar arrays, machine learning accelerators, and
radiation shielding designed to extend operational life in the
harsh space environment. Each satellite will process data
before transmitting it to Earth, reducing bandwidth requirements
and enabling real time AI inference at latencies below 10
milliseconds. Now space offers several
advantages over terrestrial data centers that make this bet
rational. Solar panels in orbit capture
roughly 8 times more energy than ground installations because
there is no atmosphere, no weather, and no night time and
the sun facing side. Cooling comes naturally through
radiative heat dissipation into the vacuum of space, eliminating
the massive water and electricity requirements that
plague Earth based facilities. And the International Energy
Agency reports that data centers consumed about 415 terawatt
hours of electricity globally in 2024, roughly 1.5% of total
power consumption. That figure is climbing rapidly
as AI training runs demand more computational resources now.
Goldman Sachs forecasts that global power demand from data
centers will increase 50% by 2027, as much as 165% by the end
of the decade. Orbital facilities avoid the
land use conflicts and NIMBY opposition that have stalled
terrestrial data center construction across the United
States and Europe. Musk has described an even more
aggressive long term vision. He wants to build satellite
factories on the moon and use an electromagnetic rail gun to
launch EI satellites at lunar escape velocity without rockets.
In his estimation, his approach could eventually deliver 100
terawatts of AI computing capacity per year into orbit.
Figure sounds absurd until you remember that Musk has a track
record of building things other people called impossible.
Now SpaceX is not pursuing this opportunity in isolation.
Jeff Bezos announced in October that Blue Origin has been
developing orbital data center technology for more than a year.
He predicted GW scale space data centers without 10 to 20 years
and claimed they would eventually beat the cost of
terrestrial facilities. Google launched Project
Suncatcher in November of 2025, partnering with Planet Labs to
put TPU chips on satellites launching in early 2027.
And Google's research paper envisions 81 satellite clusters
arranged in a 1 kilometer radius formation, communicating through
free space optical links to distribute AI workloads across
the constellation. The NVIDIA backs startup Star
Cloud already has a satellite in orbit running an H-100 GPU,
successfully training Google's Jemma A1 model in space.
Now. Star Cloud CEO told CNBC the
orbital data centers would have 10 times lower energy costs than
terrestrial facilities. Company plans to build a 5 GW
orbital data center with solar and cooling panels measuring
roughly 4 kilometers in both width and height.
Now China has entered the race with its three body computing
constellation, which launched 12 satellites in May 2025 through a
partnership between Zhengjiang Lab and Alibaba Group.
The financial picture for SpaceX makes the IPO timing very
logical right now. Company generated roughly $15
billion in revenue in 2025, is projected to hit about 24
billion in 2026, putting it roughly on par with NASA's
annual budget. And Starlink alone has grown to
over 9 million subscribers from 4 million just 15 months
earlier. Musk stated publicly the less
than 5% of SpaceX revenue now comes from NASA, meaning the
future of the company depends almost entirely on Starlink.
SpaceX launched more than 160 Falcon 9 rockets in 2025, which
is more than the rest of the world combined, and put over
3200 Sterling satellites into orbit during the calendar year.
A single Falcon booster, designated B1O67 has now
launched and landed 32 times, with turn around windows as
short as three weeks. The company hit successful 500
landings in October 2025, more than every other company in
nation state combined. Blue Origin, in second place,
has landed exactly 1. Now Mars, it remains on the
forefront. It's the elephant of the room
for long time SpaceX fans. Musk founded the company
specifically to make humanity multiplanetary, and he spent
years arguing the public shareholders would never
tolerate that expense. Now he said it would be
unprofitable work of colonizing another planet.
In 2023, he told Twitter followers that SpaceX would only
go public when Mars colonial transport, Now SpaceX President
Gwyn Shotwell reinforced his position in 2018, saying the
company would remain private until rockets were flying
regularly to the Red Planet. That's not happened yet.
They haven't even gotten a Starship to orbit yet.
There's no in orbit refuelling, and they haven't landed on
another celestial body, let alone on Mars.
Starship has not completed a successful orbital mission after
several explosive tests, and unaccrued flights to Mars remain
at least a year away by the most optimistic projections.
But that's probably not going to happen as well.
Elana stated on the record that Mars is the distraction now.
Justice Palmer, CEO of Fortuna Investments and venture capital
firm invested in SpaceX, said he expected an IPO to happen after
Starship reaches Mars because it would remove a massive risk
factor. A failed Mars attempt as a
private company causes no risk, no stock fluctuation, but the
same failure as a public company could hammer the share price.
Now the technical challenges are substantial, but not
insurmountable. Radiation in space can damage
computer chips, causing bit flips and burnout that corrupt
AI calculations. Space rated processors currently
lag three to four orders of magnitude behind commercial
hardware and raw performance, but Google estimates that space
based AI computing will only become economically viable by
2035 if launch cost dropped to $200 per kilogram from the
current 1400 to $2900 range. Starship is the key to hitting
that target, which puts SpaceX in a stronger position than any
other competitor.