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SpaceX (SPACE) could be at the forefront of a radical change in communications using quantum physics, according to Morgan Stanley

SpaceX aiming for quantum computing breakthrough – Morgan Stanley

  • SpaceX (SPACE) could be at the forefront of a radical change in communications using quantum physics, according to Morgan Stanley analyst Adam Jonas.
  • The crux of the excitement is that a space-based quantum communications network offers longer reach and is more configurable that a terrestrial fiber based network.
  • Jonas unleashed: “From a SpaceX perspective, the commercial potential of quantum communications networks and its potential advantages of its rapidly deploying in-space comms architecture may provide significant optionality to the story and its valuation.”
  • “While, to our knowledge, SpaceX has not commented in detail on the enabling technology (ie. particle entanglement generators, quantum repeaters, random number generators, advanced cryogenics, etc) or the economic potential of quantum communications, we believe the company’s increasingly dominant position in space, satellite communications and DoD/government work makes this a natural extension of their capabilities. SpaceX continues to solidify its place as ‘mission control’ for the emerging space economy. Important milestones with Starlink, Starship and government contracts dovetail to support strong commercial momentum. We note that our recently revised EV valuation to over $100bn (bull case >$200bn) does not include any direct valuation attribution related to quantum communication networks, quantum based metrology or cryptography.”
  • What kind of upside is there in being a quantum Internet leader? Morgan Stanley Asia Technology analyst Shawn Kim says quantum network technology looks very much like the early days of the Internet in 1969.
  • Back down on Earth, Google (GOOG, GOOGL) and Fidelity were early investors in SpaceX along with Elon Musk and various venture capitalist firms.
  • Investors looking to invest in the space sector in general have the Procure Space ETF (NASDAQ:UFO) to consider, which includes Virgin Galactic (NYSE:SPCE) and ORBCOMM (NASDAQ:ORBC) as top holdings.


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