US space stocks rise after SpaceX merges with xAI at $1.25 trillion valuation
U.S. space-related stocks climbed after SpaceX announced a merger with xAI, valuing the combined entity at $1.25 trillion. The deal, unveiled by Elon Musk, signals a major push to expand artificial intelligence infrastructure beyond Earth and into orbit, a vision that has energized investors across the emerging space sector.
Shares of listed space companies rallied following the announcement. Rocket Lab, Planet Labs, AST SpaceMobile, Intuitive Machines and Redwire all posted gains, reflecting growing optimism that space-based infrastructure could play a central role in the next phase of AI development. Musk has said that within two to three years, generating AI computing power in space could become more cost-effective than on Earth, thanks to near-constant solar energy and reduced cooling constraints.
The merger brings together rocket launches, satellite networks, AI software and communications platforms under one umbrella, forming what Musk described as a vertically integrated innovation powerhouse. Analysts said the move strengthens SpaceX’s positioning ahead of a potential public offering later this year, which could value the company above $1.5 trillion. The announcement has also fueled expectations of increased investment in space technology, driven by both government defense spending and private-sector demand for AI-related infrastructure.