SpaceX Owns a Rocket Company, an AI Platform, and a Consumer Internet Service. Which Business Should Investors Care Most About?

After a splashy public offering immediately followed by impressive gains, shares of Space Exploration Technologies (NASDAQ: SPCX) -- or SpaceX -- are already tumbling. Good. While it's a miserable outcome for anyone who bought in after shares began publicly trading on a stock exchange, the pullback says people aren't simply buying into the hype. They're giving some thought to the ticker's current and future value.

To this end, what's going to be the biggest driver of this stock's future price? Probably not the business you think.

Image source: Getty Images.

The future is likely to look different than the present

You know it best as a maker of rockets that power its orbital launch arm. Heck, it's in the name.

That's not SpaceX's biggest business, though. It's not even its second-biggest business. SpaceX's top breadwinner right now is satellite-based internet service provider (ISP) Starlink, which drove $11.4 billion of last year's companywide revenue of $14 billion, turning $4.4 billion of that into net income. Space launch was a distant second with its 2025 top-line figure of only $4.1 billion, while its artificial intelligence (AI) arm wasn't too far behind that at $3.2 billion in sales. AI and launch services also remain in the red for the time being.

These aren't necessarily the proportions SpaceX expects from these arms in the future. Indeed, the company believes its namesake orbital launch service will eventually be one of its least important profit centers.

It's true! Within the company's pre-IPO prospectus, SpaceX laid out its expectations for the future of each core market it serves. Although without any specific time frame attached, the company believes the space and launch industry will eventually be worth $370 billion per year, while the connectivity market that Starlink serves will eventually be worth a total of $1.6 trillion.

The proverbial big kahuna, however, is enterprise-level artificial intelligence applications. SpaceX expects this global business to be worth $26.5 trillion per year at some point in the foreseeable future.

Yes, that's trillion, with a "T."

Not everyone is as optimistic

As outrageous as this projection seems to be on the surface, it's not necessarily miles beyond the pale. For perspective, the International Monetary Fund (IMF) estimates the planet's annual GDP currently stands at more than $120 trillion. If AI ends up integrating its way into as many slivers of the world as some have suggested (ranging from medicine to logistics to energy management to banking, and more), it's conceivable that the AI business could grow to a massive proportion even compared to its size today.

Do take this optimistic outlook with a huge grain of salt, however. SpaceX hasn't exactly explained how the entire AI industry is going to reach that mark. The United Nations' trade & development outlook suggests the global AI business will only be worth $4.8 trillion by 2033, and that's a relatively bold outlook. Most projections are even smaller, like Polaris Market Research's belief that the worldwide AI market will only reach the $3.6 trillion mark by that point in time.

Connect the dots. Something's got to give unless there's something SpaceX's management has in mind that the rest of the world just doesn't see coming. Never say never.

This lack of clarity is, of course, a big reason this initially red-hot ticker is suddenly selling off.

Just stay level-headed ... and patient

There's the rub. Investors should care the most about SpaceX's AI ambitions. The bulk of the stock's steep valuation is rooted in the company's jaw-dropping expectations for just how big the market is going to get even if SpaceX doesn't end up winning the majority of the industry's future growth. At $26.5 trillion, there's still plenty of revenue to go around for everyone in the business.

In reality, however, it's conceivable that Starlink's connectivity could quietly end up as this company's actual breadwinner. Estimates from Precedence Research put the current size of the worldwide telecom market at just over $2 trillion, en route to $3.4 trillion by 2035.

Obviously, Starlink isn't the only name in the business; AST SpaceMobile is another American satellite-based broadband contender. However, Starlink does bring a competitive distinction to the table; it's got a solid head start on everyone else vying to penetrate this market, with over 10,000 satellites already in orbit serving over 12 million paying customers. It's aiming for 25 million subscribers by the end of this year, and eventually, more than 40,000 satellites.

Of course, there's nothing to prevent these two distinct businesses from being equally important to investors.

Just don't focus on the wrong thing at the wrong time. The echoes of SpaceX's well-ballyhooed IPO are still ringing, wreaking havoc on the stock. There's likely to be plenty more post-IPO volatility to wring out before the market actually starts pricing in the value of its underlying businesses. You can certainly leave SPCX on your watchlist in the meantime, though.

James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends AST SpaceMobile. The Motley Fool has a disclosure policy.