UBS projects the space economy’s TAM at $1.3TN by 2040
The global space economy’s total addressable market could reach $1.3 trillion by 2040, supported by falling launch costs, growing satellite services and increased defence spending, UBS said in an analyst report.
The estimate represents annualised growth of about 7%. A scenario in which technological development proceeds on schedule would place the market closer to $2 trillion, but the forecast was reduced by one-third to account for delays and technical hurdles.
Satellite Industry Association data valued the narrower global space economy at $429 billion in 2025, up 3% from the previous year. Commercial satellites generated $303 billion and represented 71% of the total.
Ground equipment was the largest segment at $165.2 billion, followed by satellite services at $105 billion. Consumer applications, including satellite television, radio, and broadband, accounted for $80.2 billion of service revenue.
Lower launch costs are expected to support the next stage of expansion. The cost of placing payloads into low Earth orbit could fall below $250 per kilogram by 2040, compared with roughly $1,500 to $2,000 currently.
Cheaper launches should make satellite communications, Earth observation, space logistics and emerging applications more commercially viable. Most incremental value is expected to come from recurring space-enabled services rather than launch activity itself.
National security spending is another major growth driver. The proposed US Space Force budget rises 30% to $49.6 billion for fiscal 2027, with funding directed towards missile warning, satellite protection, secure communications, and navigation.
Germany has committed €35 billion to space assets by 2030, and NATO members plan to increase broader defence and security expenditure through 2035.
Longer-term opportunities include private orbital stations, space-based manufacturing, lunar infrastructure, and orbital data centres. Many remain technically unproven and require substantial external funding.
Investment risks include launch failures, project delays, inconsistent cash flow, orbital congestion, and regulatory uncertainty. Venture investment still reached $11.6 billion across 430 space-technology deals during 2026 through early July, already matching the total recorded in 2025.
