SpaceX Lands $2.29B Space Force Contract While FAA Probes Starship Failure
SpaceX secured a $2.29 billion fixed-price contract from the U.S. Space Force to build a low-Earth orbit military data-relay network, bolstering near-term revenue prospects for PSPAC. Concurrently, the FAA mandated an inquiry into the May 22 Starship booster failure, while IPO-related index rule changes drove a ripple of buying across space-tech SPACs.
1. Space Force Contract Award
SpaceX has secured a $2.29 billion fixed-price award to build the Space Data Network Backbone, a low-Earth orbit satellite system designed to deliver secure, high-speed communications for military operations. Delivery milestones are set through 2029, potentially contributing significant revenue upside to PSPAC as SpaceX moves closer to a public listing.
2. FAA Investigation of Booster Failure
The FAA has issued a formal directive for SpaceX to investigate the May 22 Starship V3 booster failure, requiring a root-cause analysis and corrective action plan. This probe could impact testing schedules and delay key development milestones ahead of commercial deployment and the anticipated IPO.
3. IPO Preparations and Index Rule Change
SpaceX’s forthcoming IPO is bolstered by FTSE Russell’s decision to allow five-day index inclusion for large-cap newcomers, smoothing entry into benchmark indices. Combined with 30% retail allocation and strong pre-IPO fundraising, these factors enhance PSPAC’s appeal to broader investor bases.
4. Market Reaction Across SPACs
Shares of space-tech SPACs have rallied following contract news and IPO anticipation, reflecting a sector-wide revaluation. Mutual funds offering pre-IPO SpaceX exposure reported increased inflows, signaling sustained investor appetite ahead of the listing.









