SpaceX’s 20GW power target lifts industrial equipment stocks
The aerospace firm’s tentative goal to install 20 gigawatts of power and cooling infrastructure by late 2027 is driving order growth for gas turbine and energy providers, with the industrials sector already up 20% this year.
SpaceX has set a tentative target to have 20 gigawatts of power, cooling, and electrical infrastructure online by the end of next year, a move that Melius Research has identified as a significant catalyst for industrial equipment suppliers. The scale of this demand is substantial, representing nearly half of the 53 gigawatts of new power generation capacity added to the US power grid in 2025. James West, managing director at Melius Research, noted in a client note that the commentary on power infrastructure has drawn attention, describing it as a clear positive for companies supplying the necessary equipment.
Elon Musk has positioned SpaceX’s hyperscaler ambitions as a central pillar of the company’s future, with its prospectus indicating that approximately 90% of its $26.5 trillion total addressable market is expected to derive from artificial intelligence. During the company’s first earnings call as a publicly traded entity, Musk clarified that while initial compute capacity would start at 2 gigawatts, the physical infrastructure build-out would far exceed the 10-gigawatt compute target. He stated that even if forecasts do not fully materialise, the company should still possess around 15 gigawatts of capacity at the power plant level by the end of 2027.
This infrastructure push is reinforcing the broader trend supporting the AI boom, which has already propelled the industrials sector up by 20% since January and more than 80% over the past five years. The demand spans natural gas turbines, HVAC systems, and electric motors, benefiting a range of established players. Melius Research highlighted that the companies set to benefit include natural gas power suppliers such as GE Vernova and Baker Hughes, as well as power providers like Constellation Energy, NextEra Energy, Vistra, and EQT Corporation.
Financial results from these firms already reflect the surge in demand for critical infrastructure. GE Vernova reported a 36% growth in its order backlog to $176 billion in its second-quarter earnings released on 22 July, with its power segment specifically seeing order growth of 134% year-on-year, driven by strength in gas power equipment and services. Similarly, Baker Hughes reported that orders in its industrial energy and technology segment doubled year-on-year to more than $7 billion in its second-quarter earnings released on 26 July.
SpaceX’s recent debut on the Nasdaq on 11 June 2026 followed a record-breaking initial public offering priced at $135 per share, raising $75 billion and valuing the company at approximately $1.77 trillion. The stock rose 27% to $172 in early trading, making CEO Elon Musk the world’s first trillionaire on paper. The company’s aggressive infrastructure targets now add a new layer of demand to an already robust market for industrial energy solutions.
