Starship sticks the landing

Elon Musk is a lot of things, but a quitter is certainly not one of them. After 13 increasingly ambitious test flights, SpaceX’s Starship finally reached orbit this morning after its 14th launch.

Fourteenth time’s the charm

Starship is SpaceX’s next-generation rocket system, designed to become a much larger and fully reusable successor to Falcon 9—the workhorse that currently carries satellites and other cargo into orbit.

It’s a pretty big upgrade:

• Size: Starship has a payload capacity roughly four times that of Falcon 9.
• Reusability: Falcon 9 reuses only its first-stage booster, while Starship is designed for both major stages to be recovered and reused.
• Cost: SpaceX says Starship could eventually reduce the cost of reaching orbit by 99% or more compared with historical launch costs.
• Starlink: Falcon 9 currently carries Starlink’s V2 satellites, while Starship is designed for the larger V3 generation. A full load of 60 V3s could add more than 20 times as much Starlink bandwidth per launch, and Musk said all 26 satellites carried on today’s flight were “deployed and operating nominally.”

Starship isn’t just a cool rocket, it’s central to SpaceX’s larger ambitions. Musk says the company could grow from $18.7 billion in revenue last year to $1 trillion by 2030, a target that will require putting far more payload—the satellites and other cargo a rocket carries—into orbit at far lower cost.

Starlink, SpaceX’s satellite-internet business, has become a major revenue engine for the company—and brings in more than half of its income. SpaceX’s Connectivity segment, where Starlink sits, generated $4.29 billion in Q2 revenue and $1.66 billion in operating income, while its traditional Space segment brought in just $962 million in revenue and lost $542 million.

The service also had 12 million subscribers at the end of June, double a year earlier, but average revenue per subscriber fell 22% as SpaceX expanded internationally and added cheaper plans. As Starlink brings on more lower-paying customers, keeping launch costs down becomes increasingly important to protecting margins.

More to prove

While today’s flight was a significant milestone for the company, the stock fell 2.16% this afternoon thanks to some blips along the way: One of Starship’s six upper-stage engines shut down during ascent.

While successfully reaching orbit removes one major technical hurdle, SpaceX has yet to show that it can reliably recover and reuse both stages—a key step toward bringing down costs and potentially opening the door to larger commercial payloads, government missions, and other launches that Falcon 9 can’t handle as efficiently.

Today’s flight moved Starship closer to that goal. But for a company already carrying enormous expectations in its valuation, investors were left wanting more.—SY