Key Takeaways
- Elon Musk says roughly 90% of SpaceX’s revenue this year will be commercial and expects government revenue to account for less than 5% in Q4.
- SpaceX’s revenue increased from $10.4 billion in 2023 to $18.7 billion in 2025, while gross margin expanded from 41.2% to 49.4%.
- Starlink and commercial demand remain central to the SpaceX growth story, although government and defense relationships remain meaningful.
- SpaceX’s Enterprise & Government business more than doubled in the second quarter, showing why its exact government exposure is more complicated than one headline percentage.
SpaceX (SPCX) shares rallied on Friday after a busy week that included Starship reaching Earth orbit for the first time, NASA’s Crew-13 mission to the International Space Station, and Google’s Project Suncatcher prototype launch aboard a SpaceX rideshare mission. Yahoo Finance reported that SpaceX shares rallied after the successful ISS and Google launches.
SpaceX senior vice president of Falcon and Dragon Jon Edwards called it “an extraordinary week for SpaceX,” according to Yahoo Finance’s report on the company’s run of major launches.
Earlier in the week, Starship reached Earth orbit for the first time and deployed 26 Starlink V3 satellites, another milestone for a vehicle that is central to SpaceX’s plans to expand Starlink capacity and reduce launch costs.
The stock’s move also came as investors debated how dependent SpaceX really is on government business.
Investor Aaron Burnett argued on X, citing SpaceX’s S-1, that directly attributable government revenue had declined from 15% of revenue three years ago to 4% in the most recent quarter.
Elon Musk responded that roughly 90% of SpaceX’s revenue this year would be commercial and said government revenue would be less than 5% in Q4.
That distinction matters for investors because it changes how SpaceX’s growth should be viewed.
If most of its expansion comes from commercial customers rather than government spending, Starlink subscriber growth, enterprise adoption, launch demand, and execution become much more important drivers of the long-term investment thesis.
SpaceX’s Revenue Has Nearly Doubled Since 2023
SpaceX’s financial growth provides some support for that argument.
Revenue increased from approximately $10.4 billion in 2023 to $14.0 billion in 2024 and $18.7 billion in 2025, representing roughly 80% growth in two years, according to TIKR data.
Applying Burnett’s percentages directly to those annual revenue figures provides only a rough illustration because his 4% figure refers to one quarter rather than a full year.
On that basis, 15% of $10.4 billion would equal about $1.56 billion, while 4% of $18.7 billion would equal roughly $750 million.
The more useful takeaway is that SpaceX added more than $8 billion in annual revenue between 2023 and 2025 while the directly attributable government share cited by Burnett moved lower.
Profitability improved at the same time.
SpaceX’s gross margin increased from 41.2% in 2023 to 43.0% in 2024 and 49.4% in 2025, according to TIKR data.
That margin expansion suggests SpaceX’s economics have improved as the business has scaled.
Starlink is especially important to that story because its subscriber base adds recurring connectivity revenue alongside the company’s launch business.
Government Exposure Is More Complicated Than One Number
There is an important caveat.
SpaceX combines enterprise and government revenue in the same reporting category.
That means Enterprise & Government represented roughly 23% of quarterly revenue.
However, that does not mean 23% of SpaceX’s revenue came from government customers because enterprise customers are included in the same category.
Instead, the figure shows why SpaceX’s exact government exposure cannot be determined simply by looking at the combined Enterprise & Government business.
SpaceX’s relationship with Washington also extends beyond reported revenue.
SpaceX said it had been awarded more than $6 billion in multi-year U.S. government contracts for Starshield, its secure satellite network designed for government and national-security applications.
That creates an interesting balance for investors.
Commercial businesses such as Starlink can drive growth independently of Washington, while government and defense work can still provide another meaningful source of demand.
What Investors Are Really Buying
The next question is how much investors are already paying for that growth.
SpaceX currently trades at about 26.9x forward revenue, below its roughly 30.7x post-IPO average. The multiple has ranged from about 19.2x to 62.1x since the IPO.
That is still a demanding valuation. Investors are effectively paying nearly $27 in enterprise value for every dollar of revenue SpaceX is expected to generate over the next 12 months.
For that valuation to hold up, SpaceX will likely need continued growth from Starlink, commercial launches, enterprise customers, and its broader space infrastructure businesses.
Government contracts can strengthen the story, but they do not need to be the entire story.
The numbers support the broader point Musk is making: SpaceX is primarily a commercial growth story, not a business driven mainly by government revenue. Even under the broadest reading, SpaceX’s Enterprise & Government business represented about 23% of second-quarter revenue, and that category also includes non-government enterprise customers.
Still, Musk’s specific claim that government revenue will fall below 5% in Q4 remains a forecast until SpaceX reports the quarter.
For investors, the bigger question is whether SpaceX can keep growing commercial revenue fast enough to justify a valuation that still sits at nearly 27x forward sales.
So what is SpaceX stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
