Space economy: worth $613 billion and heading toward $1 trillion

The Space Foundation reports double-digit growth in many sectors. Services and applications are driving the trend, but uncertainty weighs due to tariffs imposed by the U.S

BY EMILIO COZZI

In 2024, the global space economy set a new record of $613 billion. This is according to the latest Space Report published by the Space Foundation, which depicts a rapidly expanding sector, driven by 7.8% year-on-year growth.

The main driver is the commercial sector, which accounts for 78% of the total value. The rest comes from government programs, led by the United States: Washington invested about $77 billion in 2024, spread across Defense, Nasa, and other civil agencies. What stands out the most, however, is the speed at which new segments, until recently marginal, are emerging as key players.

Services and Data Falling from the Sky

2025 is shaping up to be an even more decisive year. In the first half alone, 149 orbital launches were recorded, more than one every 28 hours. By mid-August, the number is around 170. Well over half of these, more than a hundred, are the work of SpaceX, which continues to dominate the sector with its Starlink platform and an unprecedented production pace.

Thousands of small satellites are proliferating in low Earth orbit (Leo). This is the arena of a silent commercial competition aimed at providing broadband connectivity even in remote areas of the Earth. According to a Gartner report published at the end of July, the global market for satellite communication services in LEO will reach $14.8 billion by 2026, with an annual growth rate of 24.5%.

Alongside the numbers, the diversification of demand is also growing: residential users in rural areas (+36.4%), companies (+40.2%), maritime and aeronautical services (+13.8%), and global IoT applications (+32%). While internet access in isolated areas remains one of the most tangible applications, new business models are emerging related to network resilience, navigation, and environmental monitoring. Double-digit growth points to a boom in applications whose market is still a frontier waiting to be conquered.

More and more companies and institutions are focusing on the capabilities and opportunities offered by Leo constellations to ensure service continuity in critical scenarios, from humanitarian emergencies to natural disaster management, and even real-time data collection for precision agriculture. The growing miniaturization of satellites and the reduction in launch costs have allowed startups and SMEs to enter a market previously dominated by giants, in line with the much-touted “democratizing” effect of the space economy.

Building and Working in Orbit, New Markets

Analyses by the Space Foundation indicate that the fastest-growing sectors are those related to commercial human spaceflight (+611% year-on-year) and ISAM activities (In-Space Servicing, Assembly, and Manufacturing), which grew by 168%. These numbers, taken in isolation, might suggest an imminent economic revolution. In reality, they reflect the distortion of a market still so niche that any new initiative can multiply its value.

Even the lunar economy, despite the large investments planned by Nasa, the European Space Agency (Esa), and other countries involved in the Artemis program, as well as the Eastern bloc led by China, remains a seed waiting to germinate. The true revolution has been driven by smallsats, satellites weighing from a few kilograms to a few hundred kilograms, suitable for mass production and launching in constellations.

With the multiplication of launches and payloads, a proper orbital infrastructure is also being strengthened. The idea that space could become an environment for producing, repairing, recycling, and assembling is no longer science fiction. Startups and established companies are looking at this scenario with interest: an extraterrestrial supply chain, where logistics is managed by driver satellites, automated maintenance modules, and microgravity factories.

Even the insurance, financial, and manufacturing sectors are beginning to adapt their strategies to this new dimension: unprecedented space risk coverage instruments are emerging, new benchmarks for evaluating extraterrestrial resources, and the creation of investment funds entirely dedicated to orbit.

It Will Be One Trillion

Many observers are beginning to wonder whether we are heading toward a $1 trillion space economy (using the English meaning: one thousand billion dollars).

The projection in the Space Report indicates that if the 7.8% growth rate continues steadily, this milestone could be surpassed as early as 2032. Some analysts, considering the boom in smallsats and the growing demand for space data and services, believe it could happen even sooner. According to a report prepared last year by McKinsey for the World Economic Forum, the projection for 2035 could reach $1.8 trillion.

The competition is becoming more global than ever. The U.S. dominance is being challenged by Chinese ambitions, the rise of India and the Middle East, and Europe’s attempts to carve out a strategic role through initiatives like Iris² and the Space Industrial Strategy.

Of course, geopolitical uncertainties remain a significant factor.

Earthly Clouds over Orbital Activities

The sky is not entirely clear. Commercial policies of the Trump administration, returning to the White House in 2025, are creating uncertainty.

New tariffs on technological components and strategic materials, many of which are used in aerospace manufacturing, could slow down the global supply chain. The introduction of tariff barriers on specific semiconductors, advanced materials, and optical systems, key elements for space electronics, risks extending development times and increasing costs. The result could be a contraction of investments, particularly for startups operating with thin margins and venture capital. It is also possible that the U.S. market, crucial for many companies, especially European ones, could become less accessible.

It is still too early to assess the concrete impact of these measures, but the international interdependence of the space economy, from chips to solar panels, rare metals to precision components, makes it vulnerable to any obstacle to free circulation.

Tariffs could make exporting overseas less profitable, with two possible solutions. One is to relocate, opening offices on the other side of the Atlantic, as some leading Italian companies have already done, including D-Orbit, Argotec, Impulso Space, and Officina Stellare. The other is to expand business into new markets, such as countries rapidly rising in the space arena, including China and India.