Valued at trillions, SpaceX, who is the "only alternative"?

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Author | Azuma (@azuma_eth)

After the US stock market closed on May 8, commercial space company Rocket Lab (RKLB) announced a Q1 2026 financial report that far exceeded market expectations.

The financial report shows that Rocket Lab’s revenue in the first quarter reached $200.3 million, a year-over-year increase of 63.5%, surpassing the expected $189 million; the revenue guidance for the second quarter was raised to $225 million to $240 million, well above analysts’ estimate of $205 million. Although an operating loss of $56 million indicates the company is still in a “burning money” mode, the adjusted gross margin has risen to 43% (compared to only 33.4% in the same period last year), which means that while expanding scale, the company’s unit economics are improving significantly — in simple terms, its “burning efficiency” has become higher.

Driven by the positive earnings report, RKLB rose nearly 7% after hours, with a gain of 240% over the past year.

As SpaceX’s century-scale IPO gradually approaches, commercial space has become another hot mainline in the US stock market, with capital beginning to assign internet-level valuation imagination to “rocket manufacturing.” In this wave of enthusiasm, besides SpaceX, whose valuation is directly targeting $1.75 trillion to $2 trillion and whose pre-market chips are priced at a premium, Rocket Lab, positioned as “the most SpaceX-like pure commercial space concept stock,” has become a substitute option in many investors’ eyes.

SpaceX’s “Only Substitute”?

The reason why Rocket Lab is considered SpaceX’s current “only substitute” is because Rocket Lab is perfectly replicating SpaceX’s proven successful path — first using small rockets to establish a commercial closed loop and reusable technology, then using large rockets to optimize costs and capture core markets.

Electron: The Dominator of the Small Rocket Track

In rocket manufacturing, there are many PowerPoint presentations, but few companies can reliably send rockets to space. Currently, Rocket Lab’s “Electron” is the only small launch vehicle in the world capable of high-frequency, reliable commercial operations, and it is also the second-highest launch frequency rocket in the US, just behind SpaceX’s Falcon 9.

Electron’s “maturity” is reflected not only in dozens of launches and a very high success rate but also in its landing technology implementation. Rocket Lab has successfully recovered first stages from the sea multiple times and has even reused engines for launches. This engineering mastery of “recyclability” is the ultimate weapon that dominates SpaceX in the commercial space market.

Neutron: The Challenger to Falcon 9

If small rockets are Rocket Lab’s entry ticket, then the mid-to-large rocket “Neutron” under development is its main engine to challenge a trillion-dollar market cap.

Neutron is not just a scaled-up version of Electron; from its inception, it was designed with a strong “targeted” focus — to catch up with Falcon 9. Falcon 9 remains the only commercially reusable mid-to-large rocket on the market, with SpaceX holding an absolute monopoly in this field.

The biggest significance of Neutron’s emergence is that it is expected to become the only second option in the world capable of competing with Falcon 9, although its designed payload capacity (about 8-15 tons) still lags behind Falcon 9. However, engineering logic attempts to leverage “latecomer advantages” to surpass its predecessor — with unique designs like HungryHippo fairings and Archimedes, Neutron aims to outperform Falcon 9 in fairing recovery and engine reuse efficiency.

Odaily note: HungryHippo is Neutron’s biggest design highlight. Unlike SpaceX, which needs to recover millions of dollars worth of fairing debris at sea after each launch, Neutron’s fairing is fixedly attached to the first stage and inseparable. When releasing the second stage, it opens like a “hippo mouth,” then closes after deployment, and lands together with the first stage for recovery. This means the fairing does not need to undergo complex sea recovery and post-assembly, allowing for land-based reuse.

Based on current disclosed testing progress, Rocket Lab is rapidly narrowing the gap with SpaceX in the capability of mid-to-large launch vehicles.

“Building Rockets” Plus “Building Satellites”: Replicating SpaceX’s Ecosystem Closed Loop

Just like SpaceX has Starlink, Rocket Lab is also building its own “launch + manufacturing” dual-driven ecosystem. Rocket Lab’s “aerospace systems” business (covering satellite platforms, Starlight communications, solar arrays, etc.) now accounts for nearly 70% of total revenue. This means that even while Neutron is still in development, Rocket Lab can still generate massive revenue from satellite component sales.

This “full industry chain” business model, before SpaceX’s rise, was almost unique to Rocket Lab in the public market.

Huge Valuation Gap: A Reflection of Reality and an Investment Opportunity

Currently, SpaceX’s primary market valuation has reached $1.75 trillion to $2 trillion, while Rocket Lab’s market cap is just over $45 billion. The large valuation gap objectively reflects the differences in the companies’ current positions, but this is precisely what makes the “odds” most attractive to investors.

In the current global commercial space field, the only companies capable of stable high-frequency launches, recovery and reuse, large payload capacity, and low costs are SpaceX. Falcon 9’s cost advantage has reached a level that makes most competitors despair, and this advantage is gradually creating a terrifying positive feedback loop — the cheaper the launch, the more launches, the more data, the faster the upgrades, and the cheaper the upgrades… This scale, data, and rhythm-based moat makes many later entrants daunting.

However, Rocket Lab’s opportunity lies in the fact that Neutron currently appears to be the most promising to catch up with Falcon 9’s pace among reusable mid-to-large rockets. “The only choice after SpaceX,” this label alone is already highly attractive. Once Neutron successfully conducts test flights, Rocket Lab’s valuation logic will shift from “a small rocket company” to “the world’s second platform capable of mid-to-large reusable rockets,” potentially capturing many commercial orders from SpaceX. Therefore, the current market enthusiasm for Rocket Lab largely hinges on betting on Neutron’s success probability.

By 2026, when SpaceX breaks the trillion-dollar valuation ceiling, Rocket Lab, with a market cap only about 2.5% of that, has much greater upside potential.

Largest Risk: “Neutron” Hasn’t Flown Yet…

But there’s a major suspense — will Neutron fly on time?

According to the latest disclosures, the first flight of Neutron is scheduled for the end of 2026, but historically, no new rocket has launched without delays. The harsh reality of the space industry — PowerPoint rockets ≠ real rockets.

Many rockets have never flown; many have exploded on the first attempt; many have failed in cost control and design. Neutron has not yet flown, and if its development progress stalls or its first flight is delayed, the current valuation will face severe stress testing, and even the best stories will struggle to continue.