Rockets & space

Space companies make rockets that lift things into orbit — satellites for internet, weather, GPS, and spying; cargo for space stations; and sometimes people.

For decades only governments could afford this. Then SpaceX figured out how to land rockets back on the ground so they could be reused. Launch costs dropped from about $50,000 per kilo to under $2,000. That single change made a private space industry possible.

Three big layers. Launch (rockets and the companies that make them). Satellites (the things being launched). And ground (the dishes and software that talk to those satellites).

A single mission usually crosses all three. SpaceX is unusual because it does both launch (Falcon 9) and satellites (Starlink) — most companies pick a layer.

Three customer types today. Government contracts (NASA, the US Space Force, defense agencies) — still the biggest. Telecom — companies launching internet, TV, and phone satellites. And science / Earth observation — climate satellites, weather data, agriculture monitoring.

Tourist trips (Virgin Galactic, Blue Origin) and asteroid mining grab headlines but are still tiny businesses.

Even with reusable rockets, every launch costs millions. The hardware is heavy engineering, the fuel bills are large, and a single failure can ground the whole program for months.

Most public space companies are still spending more than they earn. The bet investors are making is that demand for orbit will keep growing fast enough to grow into the costs.

SpaceX is the industry leader but it's private — you can't buy shares directly. Public competitors include Rocket Lab, traditional defense companies like Lockheed Martin and Boeing (joint venture ULA), and a few smaller launch start-ups that went public via SPAC.

This makes investing in "space" tricky. Most of the action is at a company you can't buy.

Rockets fail. Even SpaceX still loses about one in twenty. A high-profile failure can hammer a stock for months.

Government contracts can be lost or politicized. Regulation around debris in orbit is tightening. And the industry is small — a handful of customers, a handful of suppliers, lots of single-point-of-failure relationships.