SpaceX Could Be Bigger Than China, According to Elon Musk

Space Exploration Technologies (NASDAQ: SPCX) CEO Elon Musk likes to think in trillions. For the world's first trillionaire investor, that probably makes sense. For the rest of us, however, it's hard to imagine what a trillion really is.

Mathematically, of course, a trillion is 1,000 times a billion. Simple.

But pondering the real-world implications last week, The Wall Street Journal explained it thus: Yes, "a trillion is a thousand times more than a billion." But to illustrate, 1 billion pennies stacked one atop the other would stand as tall as the driving distance from New York City to Cape Canaveral, Florida.

One trillion stacked pennies, though, would be as tall as the distance to the moon and back.

Twice.

Image source: The Motley Fool.

What does this have to do with SpaceX?

Excellent question, and here's the answer:

In the IPO prospectus that SpaceX filed just before its IPO last week, the space-and-social media-and-artificial-intelligence (AI) company argued that people should invest in it because it has "identified the largest TAM [total addressable market] in human history." Across its three main businesses, space (rockets), connectivity (Starlink), and AI, Musk believes his company could potentially capture as much as $28.5 trillion in annual revenue.

Specifically:

• $370 billion from space
• $1.6 trillion from connectivity ($870 billion from Starlink Broadband and $740 billion from Starlink Mobile and "additional opportunities")
• And $26.5 trillion from AI, including infrastructure, consumer subscriptions, digital advertising, and enterprise applications

That's a lot of pennies. Enough to travel to the moon and back and to the moon and back and to the moon and back...57 times.

A trillion pipe dreams

And Elon Musk thinks SpaceX can make that much revenue every year? That implies total growth of 152,300% from the $18.7 billion that SpaceX booked last year -- which seems a bit ambitious.

To be fair, the prospectus never actually says when Musk believes SpaceX will reach a $28.5 trillion TAM. He might think that's the situation today. It might be he's talking about 100 years from now.

Before relying too much on Elon Musk's prediction, make sure to check your risk tolerance, just in case things don't work out quite as well as he's promising.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.