The AIM companies involved in new space race

The stock market flotation of Space Exploration Technologies Corp Class A (NASDAQ:SPCX) has helped focus investor attention on the space sector, but it has been receiving significant investment in the past couple of years. There are many other private space businesses that are maturing with growing revenues and moving towards profitability.

One of the important knock-on effects of the SpaceX flotation is that more space companies could be attracted to global stock markets.

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There has been interest in the space sector for many years and the money going into the sector has recently accelerated. Specialist fund manager Seraphim Space compiles data about space fundraisings, starting in 2017. There has been $70 billion (£53 billion) raised during that time. North America remains the main region where most of the cash is raised. Asia accounts for more cash invested than Europe.

The number of companies raising money reached new peaks in 2024 and then again in 2025. Seed funding numbers were slightly higher in 2024 than in 2025, and it still has the highest number of deals of any stage. However, in every subsequent stage of funding the amount raised increases, reflecting the maturing nature of some of the companies that received cash previously.

In the rolling 12 months to March 2026, there was $18.8 billion raised, which is double the level in the previous 12 months. The number of deals increased from 580 to 654. This shows that greater amounts are being raised by later-stage companies.

There was $8 billion invested in the first quarter of 2026, around double the previous record quarter, which was the fourth quarter of 2025. The top 10 deals account for 62% of the cash. This is before the SpaceX flotation, where the money raised is likely to skew the second-quarter figure.

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Seraphim Space has an index that measures 12 months trailing investment activity. It starts at 100 at the beginning of 2018. It is currently rising above 700 and has more than trebled over the past three years.

Increasing focus on defence spending has been a major driver, but not all of the investments are related to this. There are companies involved in observation of crops, for example.

SpaceX not the only IPO

Seraphim Space is the fund manager of fully listed investment company Seraphim Space Investment Trust Ord (LSE:SSIT). One of its investee companies, Hawkeye 360 Inc (NYSE:HAWK), floated in the US in the second quarter, showing that SpaceX is not the only space company seeking to go public.

Hawkeye360 went to a substantial premium in early dealings, but the share price fell back after the first few days. This appears to be happening with SpaceX.

At the end of June 2024, Seraphim Space Investment Trust had a net asset value (NAV) of 96.2p/share, which is below the share price at the time of flotation in 2021, and the shares were trading on a 43% discount.

At the end of March 2026, NAV was 177.63p/share and a subsequent investment round for investee company ICEYE, which develops technology for near real-time Earth observation for defence, insurance and responding to natural disasters, has added 73p/share to NAV.

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There has been profit-taking following a sharp rise in the share price, but the discount has narrowed. This indicates the rapidly improving valuations in the space sector.

Space on AIM

There are no AIM companies that purely focus on space and satellites. However, there are suppliers of equipment and components to companies in the sector. They will benefit from the investment of the money being raised by space and satellite companies and growth of the sector.

Filtronic (LSE:FTC) is the AIM company with the most exposure to space. Products it supplies cover radio frequency, microwave and millimetre wave (mmWave) technologies.

SpaceX is a major customer for backhaul capacity, particularly E-band amplifiers for Starlink gateways. Filtronic wins this business because of product reliability and complexity. Usage of E-band is set to grow. It appears that SpaceX will not be constructing as many gateways as previously expected, but they will be higher powered so that should still be good for Filtronic as that requires more amplifiers.

In August 2025, Filtronic won a £47.3 million contract with SpaceX for delivery in 2027 and 2028. SpaceX holds warrants in Filtronic, and warrants equivalent to 5% of the company have vested. A further 5% does not appear to have vested yet.

There are other space customers. In March, a £6 million contract was won with a new US satellite customer. Late last year, a €7 million (£6.1 million) contract was won for radio frequency assemblies for a European low earth orbit satellite constellation.

Bumper orders in 2024-25 led to a large jump in profit but it will fall back this year, partly down to raising the cost base to cope with future growth.

Space chips

Semiconductors designer and supplier EnSilica (LSE:ENSI) joined AIM as part of a strategy of changing focus from the design stage, albeit still important, to supply. Supply revenues have taken over as the most significant revenue generator for the company.

Designing a new application-specific integrated circuit (ASIC) takes years. There is income in this design phase, but the major revenues come when commercial supply begins. It can take two to five years for chip supply to commence and then production is built up to its peak.

Space-related contracts were announced in April, one of which was valued at more than $50 million. There should initially be $6.8 million of non-recurring engineering revenues in the next three years and potential UK Space Agency matching funding of up to $3 million on top.

One of the chips is for the instruments, equipment or systems onboard a satellite. A previous chip for a similar use is moving to the supply phase and could generate total revenues of $28 million.

The other new chip is for ground-based equipment used to communicate with the satellite constellation. Previous matching funding has been received in this area. There are a limited number of companies that can design these chips.

EnSilica is moving into profit and as more contracts transfer from design to supply the growth in profit will accelerate. There are five chips in production and that should rise to eight within 18 months. Even more are still in the design phase.

The first Edge AI application-specific integrated circuit, which enables AI processing within a device, is set to go into production in 2027. This is faster and uses less power and will be attractive to the space sector.

The EnSilca share price has been rising since a recent fundraising, but there is scope for further growth as profitability builds up.

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CML Microsystems (LSE:CML) is another AIM company whose technology can be used in the space sector. One year ago, CML announced a 12-year design and supply agreement with a manufacturer of Global Navigation Satellite System (GNSS) ground stations. This contract is still in the design phase, but it is valued at $30 million.

This is important validation of semiconductor technology that CML Microsystems has been developing. This has held back profitability and CML Microsystems has fallen into a loss. Winning contracts like this, as well as in other sectors where there are high barriers to entry, means that CML Microsystems will return to profit and grow it over the medium-term.

Semiconductor wafer manufacturer IQE (LSE:IQE) supplies satellite chip manufacturers, as well as being involved in UK Space Agency backed projects. An example is Lightricity, which is developing foldable, roll-out solar panels for small satellites.

Defence companies, such as Cohort (LSE:CHRT), are involved in satellite communications equipment. RC Fornax (LSE:RCFX) has won an initial contract with a UK public sector space client worth £370,000 over six months. The company is lead contractor and integrator, heading up a consortium of companies and academic partners. RC Fornax will retain ownership of the IP. There are talks concerning a second phase.

This diversification of the customer base away from the Ministry of Defence, will help the results of RC Fornax, which fell into loss after joining AIM, and the share price to recover.

Photonics technology developer Gooch & Housego (LSE:GHH) has been building up its aerospace and defence division. Profitability is also improving. Space-based optical communications is part of this growth.

Gooch & Housego photonics and optics products are used for fibre-optics, acousto-optics and optical systems for navigation, communications in space. These components and systems must overcome radiation, shock, vibration and temperature in space. Multiple high-power beams are required to overcome scattering of the laser beam over large distances.

Gooch & Housego’s specialist knowledge gives it a strong position in the market so that it can grow its space business.

Lee Wild, Head of Editorial at ii, owns shares in Seraphim Space Investment Trust.

Andrew Hore is a freelance contributor and not a direct employee of interactive investor.