NEW YORK – SpaceX (NASDAQ:SPCX) shares rallied 15.8% to $133.11 on Friday, defying concerns over a newly confirmed lunar crater caused by an uncontrolled Falcon 9 upper-stage impact. The stock’s advance came as investors focused on the company’s massive artificial intelligence investments, which dominate its capital expenditure and overshadow the space debris incident.
Satellite imagery from South Korea’s Danuri spacecraft verified the crater on the Moon’s surface, confirming the August 5 impact of the roughly four-ton rocket stage traveling at approximately 5,400 mph. The collision, which occurred after the stage completed its primary mission of delivering Firefly Aerospace’s Blue Ghost 1 lander in January 2025, was caused by increased solar activity and gravitational forces that altered its trajectory. NASA has stated the event poses no threat to Earth and that controlled lunar impacts are a standard disposal practice in some cases, though this particular impact was uncontrolled.
AI Dominates Financial Picture
The market’s reaction underscores the shifting priorities at SpaceX. In the second quarter, artificial intelligence accounted for $15.83 billion, or 86.2%, of total capital expenditures, while the space segment generated just $962 million, or 12.3%, of revenue. The Connectivity segment contributed $4.291 billion, or 54.9% of revenue, and was the only segment to post an operating profit, while AI posted an operating loss of $1.257 billion. Overall, the company reported a net operating loss of $143 million on total revenue of $7.814 billion.
Chief Financial Officer Bret Johnsen highlighted that AI initiatives are achieving a “less than one-year payback,” a key factor driving investor enthusiasm. Argus analyst Steven Silver upgraded SpaceX to Buy with a $160 price target, citing the rapid payback and expanding compute capabilities. The broader analyst consensus remains positive, with 30 bullish ratings, 6 holds, and 3 bearish, and a median target of $217, implying a 63% upside from Friday’s close. However, price targets range widely from $75 to $800, reflecting a sharp divide over the company’s multi-pronged strategy spanning AI, broadband, and space launches.
Space Sector Peers Advance
The positive sentiment extended to other space-related stocks. Firefly Aerospace (NASDAQ:FLY) rose 11.0% to $26.71, Intuitive Machines (NASDAQ:LUNR) gained 9.8% to $16.40, Rocket Lab USA (NASDAQ:RKLB) advanced 9.5% to $82.83, and Redwire (NYSE:RDW) jumped 14.9% to $13.59. Each of these companies also posted gains for the week, with Redwire leading with a 41.0% surge since Monday’s close. Rocket Lab’s advance was supported by its 92nd Electron launch, while SpaceX received an upgrade from Argus, contributing to the broad rally.
Lunar Impact Details
Danuri’s images show darker surface areas, ejecta, and the newly formed crater, which is estimated to be roughly 60 feet across and 12 feet deep, according to initial NASA projections. The space agency’s Lunar Reconnaissance Orbiter is scheduled to fly over the target area next week to refine measurements. Spectrometry detected sodium and lithium traces, according to PBS. The impact energy is comparable to an event that occurs roughly every six days, NASA said.
Market Implications and Risks
The stock’s resilience suggests that investors view the lunar debris as a lesser risk to valuation compared to AI-related spending and insider share sales, which were key topics in the earnings call. However, risks remain: a larger detected crater could trigger calls for stricter disposal regulations, and multiple unsuccessful trajectories would increase the financial impact. Substantial AI investment and additional insider share sales continue to be immediate overhangs.
Looking ahead, Rocket Lab is scheduled to report earnings after Monday’s market close, and Intuitive Machines will release its results before Thursday’s opening. NASA’s LRO may provide further updates on the crater’s size. The wide range of analyst targets and the mix of positive and negative factors suggest that volatility could persist in the space sector.
