Equity

Space Economy: A New Investment Frontier

image of satellite in sky
Jul 29, 2026|ByTony KimSimon WanYasmin Meissner, CFA

What advisors need to know about space investing

The space economy is no longer a distant or speculative theme. We find it is already delivering economic value through communications, navigation, Earth observation, defense systems, weather data, logistics tracking and satellite-enabled connectivity.

Yet the scale of the opportunity is changing. A convergence of supply-side breakthroughs — most importantly falling launch costs, reusable rockets, smaller satellites and AI-enabled autonomy — is meeting powerful demand-side drivers from AI, defense, data, connectivity, and infrastructure. Together, these forces are creating an inflection point in the space economy and emerging as one of the largest infrastructure investment opportunities of the next decade.

Space is not one market. It spans multiple applications including communications, sensing, compute, navigation, defense, and science and exploration. Space also operates across multiple orbital planes, each with distinct physics, economics and use cases. Demand for capabilities in space is being driven by both commercial and government needs, creating multiple growth vectors across the value chain.

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Tony Kim

Tony Kim

Head of the Global Technology Team, Fundamental Equities
Simon Wan

Simon Wan

Portfolio Manager, Multi-Asset Strategies & Solutions
Tomas Hamudis

Tomas Hamudis

Research Analyst, Fundamental Equities
Yasmin Meissner

Yasmin Meissner

Portfolio Manager and Head of Thematics, Multi-Asset Strategies & Solutions

Hear more from Reid Menge

Is space the next investing frontier? BlackRock’s Reid Menge breaks down why terrestrial constraints, AI-driven demand and falling technology costs could mean portions of economic activity move into orbit. From powering AI with space-based solar to satellites serving multiple industries at once, the opportunity may be closer than many think.

Talk of extending the economy into space is no longer the stuff of science fiction. We’re seeing tangible progress and vast opportunity across multiple fronts, led by the need for greater capacity to power AI.

Could space be the next investing frontier?

We see several reasons to believe it could:

1. The constraints on Earth are real. Power and land are scarce, and permitting for development is time consuming and wrought with political and regulatory complexities. Space could offer abundant solar power, no zoning requirements and global distribution.

2. One infrastructure can serve many end markets. The dual-use nature of space infrastructure makes the economics work. Every satellite is a sensor, a node or a compute endpoint that can serve multiple needs, whether commercial or defense related. The same imaging data can optimize crop yields, assess environmental conditions, or inform disaster response. The same network can equally support data transmission or stream entertainment.

3. The technology is not a blocker. Satellites, solar and compute all exist. If cost curves keep bending, putting rack-scale compute in orbit and beaming results back, the possibilities move from the fringe to real capacity.

4. This is all within Earth’s orbit. The moon, Mars and interplanetary considerations are important long term but not part of the near-term picture. The more immediate investment prospects are in Earth’s orbit.

The bottom line is: The technology exists to transport a portion of economic output into space. As the demand for AI progress has moved this story from fantastical to fundamental, it has become a key element in our dynamic AI investing stack.

Talk of extending the economy into space is no longer the stuff of science fiction. We’re seeing tangible progress and vast opportunity across multiple fronts, led by the need for greater capacity to power AI.

Could space be the next investing frontier?

We see several reasons to believe it could:

1. The constraints on Earth are real. Power and land are scarce, and permitting for development is time consuming and wrought with political and regulatory complexities. Space could offer abundant solar power, no zoning requirements and global distribution.

2. One infrastructure can serve many end markets. The dual-use nature of space infrastructure makes the economics work. Every satellite is a sensor, a node or a compute endpoint that can serve multiple needs, whether commercial or defense related. The same imaging data can optimize crop yields, assess environmental conditions, or inform disaster response. The same network can equally support data transmission or stream entertainment.

3. The technology is not a blocker. Satellites, solar and compute all exist. If cost curves keep bending, putting rack-scale compute in orbit and beaming results back, the possibilities move from the fringe to real capacity.

4. This is all within Earth’s orbit. The moon, Mars and interplanetary considerations are important long term but not part of the near-term picture. The more immediate investment prospects are in Earth’s orbit.

The bottom line is: The technology exists to transport a portion of economic output into space. As the demand for AI progress has moved this story from fantastical to fundamental, it has become a key element in our dynamic AI investing stack.