SpaceX (SPCX) and Rocket Lab (RKLB) are investing heavily in order to control more of the space economy. Aerospace and AI company SpaceX already combines launch services with its Starlink internet and has plans for orbital data centers. Meanwhile, launch and space-systems company Rocket Lab (RKLB) is taking a different path as it begins expanding into the satellite business and prepares its Neutron rocket. Nevertheless, Wall Street analysts currently prefer SpaceX.

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SpaceX Isn't Just a Launch Company

Beginning with SpaceX, the firm has the much larger business, and Starlink is a big reason why. Its satellite internet network gives the company a major source of recurring revenue between rocket launches. SpaceX is also spending heavily on AI infrastructure, so investors no longer see it as only a launch company.

And the latest quarterly results showed just how large those businesses have become. Overall revenue reached $7.81 billion, up 91.9% from a year earlier. Starlink and related connectivity operations generated $4.29 billion, while the AI segment produced $2.56 billion.

However, costs are rising fast, as research and development expenses reached $3.55 billion in Q2 due to Starship and AI investments. Capex spending was even more aggressive at $18.37 billion. This was up 557% year-over-year from $2.8 billion, and $15.83 billion went to AI alone.

Therefore, the next question is whether SpaceX can turn its huge investments into even more revenue. So far, the company completed two successful Starship V3 flight tests during the prior 90 days and signed cloud-services agreements worth $14.1 billion in contracted sales. If SpaceX can keep up this momentum, these heavy investments could be justified.

Rocket Lab Wants to Handle More of the Space Supply Chain

In contrast, Rocket Lab is much smaller. However, the company wants to handle more of the space supply chain through launches, satellites, spacecraft parts, and communications services. Indeed, its planned acquisition of Iridium Communications (IRDM) is a clear example of this.

The $54-per-share cash-and-stock deal values Iridium at roughly $8 billion on an enterprise-value basis. If completed, it would give Rocket Lab an established satellite communications network instead of forcing the company to build one from scratch.

Rocket Lab is also getting closer to finishing Neutron, which is its larger reusable rocket. In fact, the company still expects Neutron to reach the launch pad by Q4 2026. Rocket Lab is also seeing strong financial momentum.

More specifically, Q2 revenue rose by 62% to a record $234 million, while its backlog reached $2.36 billion. Moreover, management now expects Q3 revenue of $250 million to $265 million. However, some of these catalysts also create risks. For example, Neutron still has to prove itself, and a deal as large as Iridium could be difficult to integrate.

Wall Street's Take

Turning to Wall Street, out of the two stocks mentioned above, analysts think that SPCX stock has more room to run. In fact, SPCX's price target of $228.59 per share implies 63.6% upside potential. On the other hand, analysts expect 45.7% upside from RKLB and a price target of $110.93. (See SPCX Stock Forecast)