SpaceX’s Starlink profits are front-loaded by a secret launch subsidy

Firefly Aerospace Inc. was awarded a Spacecraft Processing Operations Contract from NASA on August 17, a multiple-award contract that also includes All Points Logistics, Blue Origin, and L3Harris Technologies and carries a total ceiling value of $100 million with an ordering period extending through February 2033. The contract positions Firefly to compete for task orders providing payload processing facilities and services for NASA missions launching from Vandenberg Space Force Base. "Reliable access to space depends on more than rockets — it depends on the infrastructure that gets payloads ready to fly," said Adam Oakes, Vice President of Launch at Firefly Aerospace. Two days later, on August 19, Firefly announced it is onboarding Zeno Power to its upcoming Blue Ghost lunar mission to demonstrate radioisotope technologies designed to survive the lunar night. On September 9, Firefly signed a multi-launch agreement with SSC Space for two Alpha rocket launches from Sweden's Esrange Space Center.

NASA has awarded SpaceX a $946 million contract for three additional astronaut missions to the International Space Station, extending the company's crewed flights to the orbiting laboratory through 2030. The award brings SpaceX's total NASA astronaut missions under the contract to 17 and raises its total value to $5.92 billion. The contract covers astronaut and spacecraft preparations, launches, in-space mission operations, crew returns and capsule recovery, and also includes transporting supplies and keeping the spacecraft at the station as an emergency escape vehicle. NASA selected SpaceX and Boeing in 2014 to develop spacecraft capable of carrying astronauts to the station, and SpaceX's role has grown after Boeing's Starliner encountered problems during its 2024 crewed test flight, which returned the capsule without its crew while astronauts Butch Wilmore and Suni Williams came home aboard SpaceX's Crew Dragon after their planned 10-day mission stretched beyond nine months. NASA said it wants both companies operating crew flights so a technical problem or accident involving one provider does not interrupt US access to the station.

Morgan Stanley analyst Adam Jonas reiterated a Buy rating and $300 price target on SpaceX, implying roughly 99% upside, as investors await Starship's first orbital test on September 22. The 14th Starship flight is expected to send the vehicle into orbit and deploy 26 Starlink V3 satellites, tying the launch directly to one of SpaceX's biggest growth businesses. CEO Elon Musk has said Starlink V3 deployment will begin in September and that the next-generation satellites could eventually deliver more than 100 times the bandwidth of the current constellation. Bernstein analyst Douglas Harned maintained an Outperform rating with a $248 target, implying about 64% upside, and said gaining Starship reusability to enable orbital data centers remains most important for SpaceX's valuation; he expects the Connectivity business to generate more than $100 billion in EBITDA by 2031. William Blair analyst Louis DiPalma called the latest deal SpaceXAI's fourth compute agreement in the past four months exceeding $11 billion in ARR, while Wall Street's average SpaceX price target stands at $232.07, implying about 54% upside.