To revenue and beyond: Defining valuations in China’s commercial space industry

SpaceX’s upcoming IPO has put the commercial space industry in the spotlight for investors, raising the question of how these companies should be valued

By Lee Shih Ta

If everything goes according to plan, June 12 could become a watershed moment for the global commercial space industry.

Market reports suggest that Elon Musk’s SpaceX space venture has entered the final stages of preparing for an IPO, with a valuation that could reach $1.75 trillion or more. Such a listing would not only rank among the largest tech IPOs of all time, but could also establish the first meaningful valuation benchmark for a commercial space company.

Commercial space has been officially incorporated into China’s strategy for developing “new quality productive forces” over the last two years. Both the central and local governments have rolled out supportive policies, while development of low-Earth-orbit (LEO) satellite projects such as the Spacesail and GW constellations have accelerated. Companies including LandSpace, GalaxySpace and MinoSpace have completed new financing rounds, and several are reportedly preparing for public listings. According to the China Center for Information Industry Development (CCID), the size of China’s commercial space industry has rocketed from about 800 billion yuan ($118 billion) in 2020 to nearly 3 trillion in 2025.

Yet there is still little consensus on how the industry should be valued. New energy vehicle (NEV) makers can be assessed by their sales volumes and market share. AI companies can be measured by model capabilities and user scale. But what should investors look for when valuing commercial space companies? The number of rocket launches? Number of satellites deployed? The size of their order backlog? Or something else?

In many ways, SpaceX’s IPO provides an ideal window to examine this question. Under traditional aerospace valuation models, SpaceX would clearly not come close to its current estimated valuation. While the company operates one of the world’s most successful commercial launch systems, its valuation far exceeds what could be justified by launch services alone.

Over the past decade, SpaceX’s greatest achievement may not be landing reusable rockets, but rather using lower launch costs to build the Starlink satellite network. For investors, the real attraction is not SpaceX’s actual launch capability, but rather a global communications network made up of thousands of satellites and the recurring revenue it could generate in the years ahead.

According to publicly available data, Starlink had deployed more than 7,000 LEO satellites by early 2026, with its subscriber base surpassing 5 million and annual revenue estimated at more than $10 billion. What investors are chasing is not the 7,000 satellites themselves, but the millions of paying subscribers behind them and their steadily growing stream of service revenue.

By comparison, the LandSpace Constellation project, led by Shanghai Spacecom Satellite Technology plans to deploy about 15,000 LEO satellites, a number that would eventually exceed Starlink’s current constellation of satellites in orbit. Yet the real concern for investors is not how many satellites ultimately get launched, but whether they can support a sustainable business model and generate stable cash flow.

From satellites to networks

China’s commercial space sector broadly encompasses three distinct groups. The first is companies focused on launches and manufacturing. These include commercial rocket makers such as LandSpace and iSpace, as well as satellite developers and manufacturers, whose competitive edge lies in their engineering expertise and execution capabilities. These businesses face high technological barriers to entry. But their revenue models remain largely project-based, making them more comparable to advanced manufacturing or defense contractors.

The second group is operations and services providers. Companies such as Shanghai Spacecom Satellite, which is building the Spacesail Constellation, and Geespace, backed by carmaker Geely, derive their long-term value not from the number of satellites they launch but from their ability to build and operate reliable satellite communications networks.

The third group is centered on data applications. Companies such as Piesat Information Technology (688066.SH) and Geovis Technology (688568.SH) have evolved beyond simply supplying satellite imagery. They now provide aerospace information services, digital Earth platforms and data-driven solutions. Rather than selling actual satellites, these companies provide the information and insights generated by those satellites.

Investment activity in China’s commercial space sector has increasingly shifted downstream. Beyond satellite internet infrastructure, investors are increasingly looking for companies that can provide remote-sensing data, geospatial services and aerospace data applications. Industries ranging from agriculture and logistics, to energy management, low-altitude aviation and autonomous driving, are increasingly relying on real-time spatial information to support their decision-making.

As a result, the value chain of the commercial space industry is gradually extending downstream. Investors have traditionally viewed aerospace companies through a manufacturing lens. But the greatest valuation upside in the future may come from companies providing data services, communications networks and the applications built on top of them.

Commercial space can be better understood as an industrial chain rather than as a single industry. From rocket launches and satellite manufacturing to satellite operations and data services, each segment serves different customers, addresses different markets and follows different business models. Investors may currently group them under the same theme, but valuation differences are likely to become increasingly apparent as the industry matures.

Once SpaceX goes public, the market may, for the first time, establish a valuation framework that can serve as a reference point for the commercial space industry.

For Chinese companies, the challenge is not simply sending more satellites into orbit, but turning those satellites into viable businesses. Spacesail may deploy 15,000 satellites and LandSpace may launch more rockets. But without recurring revenue, those assets ultimately remain cost centers rather than value creators.

Over the past decade, the companies that have commanded the highest valuations have generally not been those that merely control hardware, but those that control networks, users and data. Tesla is one case in point. Nvidia is another.

Whether commercial space will follow the same trajectory remains an open question. But as more Chinese commercial space companies move toward public listings, the key question for investors may ultimately be: Who will be able to charge the most for services in the future space economy?

Lee Shih Ta is an editor at Bamboo Works.

You can contact him at shihtalee@thebambooworks.com

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