Americans Are Cutting Back on Spending. Here's Why That Might Not Matter for SpaceX Investors.

Americans are still spending, but they are getting more cautious and looking for deals. A recent University of Michigan survey showed that Americans expect inflation to be 4.6% over the next year, down slightly from an expectation of 4.8% in May.

On the first day of Amazon's Prime Day event, U.S. online spending rose 5.3% year over year to $8.3 billion across retailers, according to Adobe Analytics, a part of Adobe, which expected the four-day event to drive $26.3 billion in U.S. online spending. Meanwhile, Costco Wholesale's (NASDAQ: COST) May sales rose 14.5% year over year to $20.95 billion. This shows that value-oriented platforms can still win when shoppers are under pressure.

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However, certain areas of the consumer economy are under strain. Beyond Meat's first-quarter revenue fell 15.3% year over year to $58.2 million, with the company citing weak demand and reduced distribution in certain channels. Conagra Brands also showed that certain food categories are not immune. In the third quarter of its fiscal 2026 (ending Feb. 22, 2026), the company's sales and adjusted earnings per share dropped 1.9% and 23.5%, respectively.

But what about a company like Space Exploration Technologies (NASDAQ: SPCX)? After all, you can't buy its products at the store or in an online marketplace. But its Starlink provides internet service to consumers. Starlink had 10.3 million subscribers across 164 markets at the end of the first quarter of 2026, supported by more than 9,600 broadband and mobile satellites in low earth orbit.

SpaceX's Starlink network serves individuals, governments, and businesses and is expanding to aviation and maritime, according to Reuters. Subsequently, Starlink demand is more closely tied to connectivity needs than to ordinary discretionary spending, so I don't think the consumer spending trends are an influence here.

Other risks

Instead of consumer weakness, investors should focus on other risks. SpaceX generated $18.7 billion in revenue in 2025, but it also posted a $4.9 billion net loss. The company also trades at around 110 trailing 12-month sales on June 30, a premium valuation that leaves little room for mistakes.

Starlink's monthly average revenue per user (ARPU) fell to $66 in the first quarter of 2026, down from $86 in the previous year. Starlink needs to expand its customer base without sacrificing too much pricing power or margins.

SpaceX is also exposed to significant execution risk with its next-generation Starship reusable rocket system. The success of Starship will determine whether the company can launch larger Starlink satellites and rapidly expand network capacity, while lowering launch costs. SpaceX is also spending heavily on artificial intelligence infrastructure.

This all points to the fact that a weaker consumer is not the most immediate challenge to SpaceX's investment thesis. Instead, investors should assess the company's rich valuation, Starlink pricing pressures, Starship execution risk, and AI spending before investing in this stock.

Manali Pradhan, CFA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Adobe, Amazon, Beyond Meat, and Costco Wholesale. The Motley Fool recommends the following options: long January 2028 $330 calls on Adobe and short January 2028 $340 calls on Adobe. The Motley Fool has a disclosure policy.