Space Is Becoming a Battlefield – and a Business

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Space has helped inform wars on Earth for decades.

Now the United States has acknowledged that it is prepared to fight there, too.

On Monday, Air Force Secretary Troy Meink publicly confirmed for the first time that the U.S. has deployed what he called “on-orbit space-control weapons.”

He did not say what they are. He did not say how many exist. And he would not explain whether they jam hostile signals, disable enemy satellites electronically, or use some other method entirely.

The details may be classified, but the message is not…

Space is becoming the next battlefield.

That would be a major story on its own.

It is also arriving as a French-UAE consortium commits $1 billion to an AI-enabled satellite constellation, Planet Labs (PL) reports record revenue, BlackSky (BKSY) grows sales 50%, and another rocket startup – Stoke Space – raises $1 billion to expand launch capacity.

For years, investors valued the space economy largely on what it might become. Global internet from orbit. Persistent surveillance. Lunar infrastructure. Factories in microgravity. Data centers floating above Earth.

Now the vision has customers. 

Government budgets are becoming contracts. Satellite fleets are becoming recurring revenue. AI is moving onboard spacecraft. Launch providers are raising billions to meet an expanding manifest.

The space economy is beginning to show up where Wall Street can measure it.

Defense Spending Is Becoming a Growth Engine for Space Stocks

We’ll start with the national security angle.

Governments are waking up to the uncomfortable fact that space is the new strategic battleground.

Satellites provide battlefield intelligence, secure communications, missile warnings, navigation, targeting, and surveillance. 

Modern militaries would struggle to operate without them. Yet, that dependence also makes satellites targets.

China and Russia have spent years developing systems that could jam, disable, deceive, or destroy spacecraft. The U.S. government has repeatedly warned that losing access to orbital systems could cripple military operations on Earth.

Now Washington has publicly acknowledged its response.

Meink said the Space Force has weapons in orbit capable of defending American forces from hostile action. The exact systems remain classified, so investors should resist the temptation to guess which contractors built them.

Which Space Stocks Are Exposed to Defense Spending? 

Instead, remember that this is a long-term arms race – one that favors nimble, responsive space companies with launch capacity, satellite imaging capabilities, and hardware manufacturing.

The usual suspects benefit here:

• BlackSky and Planet Labs provide Earth intelligence.
• Rocket Lab (RKLB) offers launch, spacecraft, and space-system capabilities.
• Palantir (PLTR) helps military customers turn enormous streams of information into decisions.
• And traditional defense companies such as L3Harris (LHX) supply communications, sensors, electronic warfare, and command systems.

We estimate national defense TAM in space is about $30- to $40 billion today. But as intelligence demand and geopolitical tensions escalate, it could easily double over the next decade.

And it’s just one vertical of the multi-faceted Space Economy…

Satellite Internet Is Expanding the Space Economy

Another big vertical here is space-based communications because the entire communications industry is being rewritten from orbit.

The world is moving toward a space-powered internet: a global, always-accessible broadband network delivered from thousands of small satellites in low Earth orbit (LEO).

This is more than a theoretical future. It’s already in action:

• Starlink now has over 10,000 satellites in orbit and serves 12 million users worldwide.
• Amazon Leo (formerly dubbed Project Kuiper) continues building out its constellation to support AWS and global internet.
• AST SpaceMobile (ASTS) is taking another route, building satellites that connect directly to ordinary smartphones without requiring a separate dish or terminal.

That’s a major step up, especially considering that 2.2 billion people worldwide still lack reliable internet access, and billions more suffer from poor mobile coverage.

Not to mention, we still don’t have cell coverage on airplanes. And natural disasters like earthquakes, fires, and tsunamis often knock out cell coverage when we need it most.

The opportunity here extends beyond just the companies operating the constellations.

Every network needs antennas, radio-frequency chips, optical links, ground equipment, spectrum, cybersecurity, and a steady flow of replacement satellites.

A successful constellation is not a one-time hardware sale.

That’s why we think the total addressable market here is huge. We see it climbing toward $40 billion by 2035 – possibly much more if these constellations become the backbone for rural broadband, global telecom, and even cloud connectivity.

Orbital Data Centers Could Become the Space Economy’s Biggest New Market

Here’s the vertical that didn’t exist when we first started writing about the space economy – and it may end up being the biggest of them all.

AI’s growth is running into hard physical limits on Earth. Data centers need enormous amounts of land, power, and water – and communities increasingly don’t want them nearby. Lawmakers in at least 14 states have introduced legislation to restrict new data center construction.

That has pushed companies toward a much bigger idea: Move some of the computing into orbit.

The most ambitious version involves large orbital data centers powered by solar energy and linked through laser communications.

Of course, that will take time. Launch remains expensive. Radiation damages electronics. Hardware is difficult to repair. And while space is exceptionally cold, engineers haven’t yet cracked efficient GPU cooling in orbit because there’s no air for convection.

The long-term race is already drawing some of the biggest names in technology and space. 

SpaceX has filed with the FCC to launch up to one million orbital data centers. Google has entered talks with SpaceX to expand its own space-based compute efforts. Anthropic has expressed interest in partnering on orbital AI capacity. And Jeff Bezos’ Blue Origin just asked the government for permission to launch more than 50,000 orbital data centers of its own.

Most recently, on Sept. 9, a consortium involving companies in France and the UAE committed $1 billion to a new 50-satellite constellation carrying radar, optical cameras, and other sensors.

BlackSky will serve as the exclusive provider of its very-high-resolution optical satellites. Mistral AI is involved on the model side to process information in orbit and deliver useful alerts within seconds.

Giant data centers can come later. The first commercial win may simply be making today’s satellites much smarter.

And that leads directly into one of the space economy’s most established markets: Earth observation.