Analyst: xAI Accounts for 71% of SpaceX's $2 Trillion Valuation
A senior equities analyst at the Center for Financial Research and Analysis (CFRA) estimates that xAI contributes 71% to SpaceX's current $2 trillion market capitalization. The analyst, Keith Snyder, indicates that achieving this valuation necessitates an "almost comical growth" for AI that current adoption data for Grok does not support. SpaceX's S1 filing claimed a $26.5 trillion total addressable market in AI, a figure challenged by analysts given current xAI adoption rates.
SpaceX's valuation, reaching a $2 trillion market capitalization after a $1.77 trillion IPO, has drawn scrutiny from financial analysts. Keith Snyder, a senior equities analyst at the Center for Financial Research and Analysis (CFRA), states he can only align with the $2 trillion valuation by factoring in what he describes as "almost comical growth for AI," yet still finds the figures challenging to fully reconcile.
Snyder estimates that xAI accounts for 71% of SpaceX's overall valuation. He expressed skepticism regarding the AI projections presented in SpaceX's S1 filing, hoping investors did not heavily weight those numbers. While acknowledging that SpaceX's rocket and satellite business, including Starlink, is profitable and has millions of subscribers, the substantial portion attributed to AI raises questions.
The S1 filing projected a significant future for AI, claiming 93% of SpaceX's total addressable market (TAM) would be "in AI," equating to roughly $26.5 trillion. SpaceX stated in its S1 filing with the Securities and Exchange Commission: “We believe we have identified the largest TAM in human history.” This $28.5 trillion quantifiable TAM included $26.5 trillion allocated for AI, broken down into $2.4 trillion for AI infrastructure, $760 billion for consumer subscriptions, $600 billion for digital advertising, and $22.7 trillion for enterprise applications.
However, current data on xAI's Grok adoption presents a different picture. Out of 117 million users interacting with Grok's freemium model, only 1.6% (1.9 million subscribers) pay for its premium tier. This contrasts with approximately 5% paid users for ChatGPT in 2025. Data from AI adoption tracker Ramp indicates xAI has just 3% business adoption, significantly lower than Anthropic and OpenAI, both at 40%.
Kyle Poyar, a former operating partner at venture capital firm OpenView, commented on AI monetization strategies. Poyar suggested that consistent, high-value user engagement is crucial for converting free users to paid subscribers, a trend not clearly evident with Grok. He noted that companies like Anthropic make themselves indispensable through deeper, stickier use cases, effectively using free offerings as an on-ramp to more profitable customer relationships. Snyder also voiced concern over Grok's competitive position, perceiving it as behind OpenAI and Anthropic in terms of model complexity and sophistication, which he believes is reflected in the low paid user percentage.
According to Fortune, SpaceX did not respond to a request for comment regarding these analyses.
