Deutsche Bank: SpaceX's Political Risks Are Overstated, Tightening Computing Supply Will Boost Company Revenue

On November 8, the latest research report indicated that the market's concerns about political retaliation facing SpaceX after the midterm elections are significantly overstated. The bank maintains its "Buy" rating and a target price of $250. It believes that SpaceX's core contracts are signed with federal agencies such as NASA and the Space Force, leaving very limited room for congressional intervention, and there are currently no viable alternative suppliers in most business areas. Even if SpaceX seeks to merge with Tesla, Congress has no direct authority to block it and can only delay through hearings. The real risk to watch in the near term comes from the Texas governor's tough stance on data centers, but this is more likely to lead to stricter scrutiny rather than an outright ban. Since the majority of SpaceX's computing power will be deployed outside Texas by 2027, the short-term impact is limited, but there is uncertainty regarding expansion plans in 2028 and beyond, which may shift to places like Louisiana.

It further proposed a reverse logic: if Texas policies lead to a slowdown in overall computing power expansion in the U.S., SpaceX may actually benefit from it. Due to its faster and cheaper computing power construction compared to competitors, and the new cloud contracts having a 90-day cancellation clause, SpaceX can flexibly capture upward space when spot prices rise. If the entire industry faces limited computing supply, SpaceX has the ability to significantly raise prices, thereby driving revenue and EBITDA up.

Regarding the uncertainty of Texas policies, Musk recently stated that "data centers in space now look quite attractive." He pointed out that the reusability of Starship will be key to unlocking the economics of orbital data centers, with a baseline forecast of deployment capacity reaching 500 megawatts by the end of 2029. In terms of launch operations, since approval and regulation fall under the federal FAA's responsibilities, the Texas governor cannot directly intervene, but can increase the difficulty of expanding the interstellar base through land use rights and state-level permits.