Bernstein reiterated its Outperform rating and $248 price target for SpaceX on Friday, citing the company’s dominant position in space launch and potential orbital data center revenue as key valuation drivers. Analyst Douglas Harned emphasized that SpaceX’s multi-trillion dollar valuation opportunity remains tied to its ability to leverage orbital infrastructure for artificial intelligence applications, rather than near-term telecom services.
Harned highlighted significant technical obstacles to SpaceX’s planned direct-to-device mobile service, which the company has targeted for a late-2027 launch. The initiative, centered on a second-generation satellite constellation operating at roughly 350 kilometers—lower than typical LEO satellites—faces uplink path loss and battery consumption challenges. Higher transmit power required to connect smartphones to satellites at that altitude accelerates battery drain and strains antenna gain capabilities, Harned noted.
The analyst described the engineering hurdles as substantial, stating that solutions are unlikely to be fully resolved in the near term. Bernstein suggests SpaceX may need to pursue additional approaches to compete with terrestrial incumbents such as AT&T, Verizon, and T-Mobile, which collectively invest double-digit billions annually to maintain nationwide LTE and 5G coverage. Harned advocated for a partner-based model, framing a mobile virtual network operator (MVNO) arrangement as the most viable path forward.
SpaceX is collaborating with mobile network operators in more than 30 countries on its direct-to-device service, but Harned cautioned that economic viability will require coverage beyond mere dead zones. The V2 satellite constellation’s design—featuring four times the receiver size and higher beam density—aims to address signal quality issues, though Harned likened amplifying a poor-quality signal to turning up volume on an unclear conversation.
The firm’s bullish stance on SpaceX’s core launch business contrasts with its measured outlook on the telecom segment, where technical and economic barriers remain unresolved ahead of the planned 2027 deployment.
