Debunking ARK’s Cathie Wood has become something of a perfunctory exercise at this point, yet one I feel compelled to continue for the good of the human race…and for “investors” whose frontal lobes may not be fully developed yet.
Critiquing her analysis always reminds me of a line from one of my favorite movies, Grandma’s Boy: “This is like if Mike Tyson fought an infant.”
And I’m no intellectual giant, trust me. That’s what makes the analogy so troubling.
While you were doing other things, Wood appears to have returned to the method of securities analysis that made her famous yesterday: take the most optimistic thing Elon Musk has ever said, multiply it by a gigantic number, pepper in between one and fifty batshit-insane assumptions, pray for a gamma squeeze to make it all make sense, then fire the whole thing out in 280 characters or less on Twitter, letting the word “if” do more heavy lifting than the elevator at Jerry Nadler’s apartment building.
Yesterday Wood, who by 2024 had destroyed approximately $14 billion in investor capital according to Morningstar, took to Twitter to opine on SpaceX. Her latest “analysis” goes something like this: “Each Starship launch could generate $1 billion in revenue. Elon is aiming for 10,000 flights per year, or $10 trillion in Starship revenues, by 2030. If SpaceX achieves this goal, its $1.75 trillion IPO will be considered, in hindsight, a deep value opportunity!”
Yeah, and if I set up a roadside Lemonade stand and sell 10 billion cups of lemonade next year for $1,000 each, I will have a $10 trillion business. The multiplication is not the difficult part. The difficult part attempting to make any of the assumptions make sense without first huffing paint for 3 hours and then having someone strike the part of your brain responsible for critical thinking with a tire iron repeatedly.
Keep in Wood’s target here is 2030…about 3 years and 3.5 months away. 4 years and 3.5 months if you want to give her the benefit of having the entire year to get this little shopping list of fantasies checked off.
Here’s what Cathie Wood wants done in less than 5 years:
10,000 Starship flights per year(roughly 27 launches every calendar day)$1 billion in revenue per launch(roughly $27 billion in revenue per day)
Let’s start with 10,000 Starship flights per year. That works out to about 27 launches every single day, 365 days a year. SpaceX would be launching a Starship approximately once every 53 minutes, around the clock.
Think about the physical infrastructure required to do that…launch sites, landing sites, fuel production, maintenance, refurbishment, weather, airspace restrictions, environmental reviews, regulatory approvals, manufacturing and logistics.
For reference, to the best I can count, Starship has conducted just 13 integrated flight tests to date, with multiple flights resulting in the loss of the Starship upper stage, the Super Heavy booster, or both, including three consecutive Starship losses on Flights 7, 8 and 9.
But even if we wave our magic wand and grant SpaceX 10,000 annual flights, we arrive at the far more important problem: the $1 billion in revenue per launch. Revenue from whom?
And if every one of 10,000 Starship flights generates $1 billion in revenue, somebody somewhere needs to spend $10 trillion every year buying…well, whatever Starship is selling. That is $27.4 billion per day. Every day.
This isn’t a forecast for SpaceX becoming a very large aerospace company. It appears to require the emergence of an entirely new economy worth trillions upon trillions of dollars annually, almost immediately, with SpaceX sitting directly in the middle of it and monetizing the hell out of virtually everything.
Perhaps Wood imagines orbital data centers, Mars colonization, lunar infrastructure, military applications, satellite deployments, point-to-point travel and a Buc-ee's on Uranus. But “could eventually exist” and possibly “generating $10 trillion in SpaceX revenue four years from now” are two spectacularly different statements.
The entire promise of Starship is that reusability could make putting things into space dramatically cheaper. That’s one of the reasons Starship could be revolutionary.
But in Wood’s valuation exercise, the rocket that is supposed to collapse the cost of accessing space also produces an average of $1 billion in revenue every time somebody lights the engines.
Those two ideas are not inherently contradictory. SpaceX could sharply reduce its own cost per launch while still charging customers substantial sums, particularly if Starship enables entirely new missions, carries vastly larger payloads, or commands significant pricing power.
But the valuation needs to explain how those economics coexist over time. If Starship succeeds in commoditizing access to space and launch capacity expands dramatically, basic economics would suggest that at least some of those cost savings should eventually flow through to customers in the form of lower prices. Competition could reinforce that pressure.
So the relevant question wouldn’t be how cheap Starship becomes to operate. It would be how SpaceX maintains extraordinarily high revenue per launch in a future where Starship has supposedly made access to space dramatically cheaper and more abundant, while competitors are simultaneously developing reusable launch systems of their own.
If SpaceX’s breakthrough works as advertised, and competitors follow it down the cost curve, it becomes increasingly difficult to assume that falling launch costs won’t eventually translate into pricing pressure.
I mean…a substantial portion of future Starship activity could presumably involve deploying Starlink satellites and other SpaceX-owned infrastructure. Musk said in 2022: “Starship is the only thing that can carry the Starlink 2 satellites.”. In 2026 he told employees: “The sheer number of satellites that will be needed for space-based data centers will push Starship to even greater heights.”
Those launches can obviously create enormous economic value for SpaceX. But SpaceX cannot simply invoice SpaceX $1 billion, move the money from its left pocket to its right pocket and declare another billion dollars of consolidated revenue.
And the same problem applies to the sheer amount of payload capacity Wood’s scenario implies. Capacity isn’t demand. If Boeing announced tomorrow that it had invented a factory capable of producing 100,000 airplanes per year, analysts wouldn’t immediately multiply 100,000 by the price of a Dreamliner and enter the resulting number into their revenue models. Well, fuck…in this day and age, actually, they might.
But I digress. At least they *might *ask a somewhat important follow-up question: Who in God’s name is buying 100,000 airplanes?
That’s essentially the question investors should ask here. Starship could become capable of launching 10,000 times annually. Fantastic. That would be one of the most astonishing engineering accomplishments in human history. It does not mean customers automatically materialize to purchase $10 trillion worth of transportation. And the $1.75 trillion “deep value” conclusion is basically meaningless once you’ve assumed $10 trillion in annual revenue.
Of course a $1.75 trillion company looks cheap if you assume it’s headed for $10 trillion in annual revenue and don’t look at costs. That’s the beauty of this kind of analysis: with a sufficiently ridiculous denominator, almost anything becomes “deep value.”
I realize it’s 2026…the age of Tom Lee and Fartcoin and unlimited printed dollars…and that equity analysis has become something of an ancient lost art, but “deep value” used to mean a company was cheap relative to earnings, free cash flow, book value, or some other measure of actual economic value. It did not mean comparing today’s market cap to some enormous hypothetical revenue number years in the future.
Revenue is not net income. It isn’t free cash flow. You can generate $10 trillion in sales and spend $15 trillion doing it. Margins, capex, competition, dilution and the cash ultimately left for shareholders are what matter. Calling something “deep value” because its market cap looks small next to fantasy future revenue isn’t valuation. It’s making up the future first and doing the math second.
Look, none of this is to say SpaceX isn’t an extraordinary company or that Starship couldn’t fundamentally reshape the economics of spaceflight. It very well could. Lower launch costs could unlock industries that barely exist today. Starlink could become considerably larger. Defense and intelligence applications could expand. Lunar infrastructure, orbital manufacturing, data centers and other currently speculative markets could someday become real businesses.
There is a compelling SpaceX bull case that can be made without resorting to cracked out, careless and obviously near-impossible figures.
Wood has forecast 10,000 launches, attached a billion dollars to each one, and successfully demonstrated math: that 10,000 multiplied by $1 billion equals $10 trillion. On that narrow point, I have checked the math. It checks out. Just don’t ask how we get to those numbers to begin with. And shame on anyone in the financial media that parrots this analysis without asking extremely pointed questions about it.
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