SpaceX IPO: 1 Reason This Is the Top Space Stock to Watch in 2026

A SpaceX initial public offering (IPO) could be just around the corner. And while the company hasn't revealed many details surrounding the potential IPO, analysts are hearing that a public stock sale could make history. "Now that Musk has merged the rocket enterprise with xAI, another pillar of his empire, he expects the combination to raise $50 billion in capital, and garner a market cap of $1.5 trillion," a report from Fortune magazine recently revealed. "At those numbers, SpaceX would notch the single biggest IPO capital raise of all time."

Should you be getting excited about the SpaceX IPO? Absolutely. With $50 billion in fresh capital, plus direct access to public capital markets to quickly raise billions in additional funding, SpaceX will be able to dream bigger than ever before. The biggest dream may not be a trip to mars or the moon, but the establishment of artificial intelligence (AI) data centers in space.

AI data centers in space would change everything

Electricity costs in the U.S. jumped 6.9% in 2025 -- roughly double the baseline rate of inflation that year. According to most experts, the surge is far from finished. A recent report from Goldman Sachs, for example, predicts that electricity prices will continue to rise through the end of the decade. It's not hard to figure out why. Data centers -- a critical piece of infrastructure that makes AI applications possible -- are experiencing a massive global build-out. By 2030, Goldman Sachs predicts they will be responsible for 40% of the growth in electricity demand.

This is a multipronged problem for both data center operators and AI companies. Right now, fossil fuels still contribute 60% of the power needed to run data centers. And due to geopolitical conflicts, the supply and pricing of fossil fuels is as uncertain as ever. Rising electricity prices, meanwhile, won't just hinder growth, but will also pit these companies against a growing political backlash. Goldman Sachs analysts believe consumers will end up with lower disposable income as a result of higher energy costs. "The income and spending drags will likely be larger for lower-income households because electricity accounts for a greater share of their spending," an analyst from Goldman Sachs stresses.

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Why are data centers so in need of electricity? A single data center often consists of thousands of high-performance servers, processors, and storage drives running ceaselessly. This is why component manufacturers are increasingly trying to develop more energy-efficient systems. But perhaps the most difficult hurdle is the significant energy needed for cooling all these systems. Without proper cooling, the components could suffer performance degradation, and at worst permanent damage.

To lower cooling costs, data center businesses have repeatedly explored locating data centers in colder regions like Alaska or Greenland. The main issue here is finding a nearby energy source that is large and reliable enough to power the remaining electricity needs. This is why nuclear innovators like Oklo and NuScale Power are aggressively investing in SMR technology: an approach to nuclear power that is smaller and more modular, making it an ideal fit for remote, off-grid locations.

But what about space? So-called orbital data centers, or ODCs, could theoretically tap into a constant supply of solar power, benefiting from extremely cold conditions in low-Earth orbit. Some ODC innovators believe this approach could reduce cool costs by up to 90%. Of course, initial deployment costs would be massive. This is what makes SpaceX such a compelling contributor. No other company, for instance, has been able to match SpaceX's execution of its Starlink satellite internet network. Why? Because the company can launch payloads into space faster and cheaper than any other competitor. And soon, its launches could be 10 times cheaper thanks to its massive Starship prototype.

Huge challenges remain for the advent of ODCs. The vacuum of space, for example, presents one of the major physics hurdles for lowering cooling costs. But if there's any company globally that would likely be the beneficiary of space-based data centers, it would be SpaceX given its impressive lead of scaling low-cost rocket launches. Up to $7 trillion could be spent on scaling data center infrastructure over the next few years. With the fresh capital of a massive IPO -- enough to fund legitimate attempts at achieving viable ODCs -- SpaceX could be a primary beneficiary.

Ryan Vanzo has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Goldman Sachs Group. The Motley Fool recommends NuScale Power. The Motley Fool has a disclosure policy.