Space Data Centers Thesis (I) – 5 Stocks with Realistic Mid-term 10x+ Potential
Outlier Capital
· Outlier Capital
· July 13, 2026 at 12:45
· ⏱ 11 min read
| Read on Substack ↗
Summary
Orbital data centers represent the next structural wave in AI infrastructure, overcoming terrestrial limits on power, cooling, and land. The article identifies five small-cap stocks with direct exposure to critical bottlenecks (power, thermal, launch, comms, processing) that could deliver 10x+ returns over 5-7 years as SpaceX's Starship makes orbital compute economically viable.
•Terrestrial AI data centers face exploding electricity demand, land scarcity, water cooling needs, grid delays, and community opposition.
•Orbit offers abundant solar power, radiative cooling, no land/water footprint, and scalable deployment via Starship (~$200/kg launch cost).
•On-orbit processing slashes downlink bandwidth and enables faster decisions for latency-tolerant AI workloads like training and batch inference.
•SpaceX's Starmind initiative plans to deploy tens to hundreds of gigawatts of orbital compute, with initial deployments as early as 2028.
•Market projections for in-orbit data centers range from $1.78B (2029) to $39B (2035), with CAGR up to 67% in aggressive scenarios.
•The five picks are Filtronic, Redwire, Intuitive Machines, Rocket Lab, and AST SpaceMobile — each targeting a specific bottleneck (RF, power/thermal, processing, launch/comms, connectivity).
Intuitive Machines is pivoting into in-space data processing and edge computing, targeting the orbital data center market with a $175M capital raise and Lanteris acquisition.
Filtronic is a key RF/mmWave hardware supplier to SpaceX/Starlink, essential for LEO communications infrastructure needed by orbital data centers, with strong recent growth and capacity expansion.
Redwire's ROSA solar arrays and deployable radiators directly solve power and thermal bottlenecks for orbital data centers, and the company has published dedicated ODC architectures.
Rocket Lab's Neutron launch vehicle is purpose-built for ODC deployment, and its in-house laser comms (via Mynaric) are critical for inter-satellite networking and data transfer.
AST SpaceMobile's LEO constellation for direct-to-cell broadband provides leveraged exposure to the overall LEO infrastructure supercycle that includes orbital compute, with high-bandwidth space-to-gr
AST SpaceMobile's LEO constellation for direct-to-cell broadband provides leveraged exposure to the overall LEO infrastructure supercycle that includes orbital compute, with high-bandwidth space-to-ground links needed for data return.
The article mentions 'Google-linked test satellites are targeted for 2027,' indicating Alphabet is actively exploring orbital compute infrastructure, positioning it as a potential hyperscaler customer
The article mentions 'Google-linked test satellites are targeted for 2027,' indicating Alphabet is actively exploring orbital compute infrastructure, positioning it as a potential hyperscaler customer or partner.
Risk: Early-stage; no confirmed deployment scale. Competition from other hyperscalers (Amazon, Microsoft) also exploring space-based AI.
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