Cathie Wood's Ark Invest Says Elon Musk's Starship 'Critical' To Solving AI's Power Bottleneck With Orbital Data Centers

Cathie Wood‘s ARK Invest is highlighting orbital AI data centers as a necessary solution to the artificial intelligence (AI) industry’s immense energy demands, identifying Elon Musk-led SpaceX‘s Starship as the “critical” technology to make it viable.

Tech Giants Are Exploring Ways To Overcome Power Shortage

The focus on space comes as tech giants, including Alphabet Inc. (NASDAQ:GOOG) (NASDAQ:GOOGL), Nvidia Corp. (NASDAQ:NVDA), and SpaceX, actively explore orbital computing to bypass a terrestrial “power bottleneck” that is stalling AI’s growth.

In a recent research newsletter, ARK analysts identified power as the “major bottleneck to scaling AI infrastructure.”

The firm cited Microsoft Corp. (NASDAQ:MSFT) CEO Satya Nadella's admission that some GPUs are idle due to limited electricity and noted that backlogs for essential gas turbines are roughly seven years long.

See Also: Wells Fargo Follows Cathie Wood’s Playbook, Bets On ‘Nuclear Option’ Amid AI-Driven Electricity Surge— Favors Industrials, Utilities

Orbital Data Centers: A Way To Bypass Electricity Shortage?

A 25–30% projected leap in power demand over the coming decade, with AI-driven data centers, is becoming a dominant force, now inspiring innovation not only in power sourcing but also radically new infrastructure strategies.

To bypass these limits, hyperscalers are “turning to space for always-on power to sustain AI growth.”

The strategy involves sun-synchronous satellites that can draw on “near-continuous solar power” and link via lasers, creating what ARK calls a “global, distributed, always-on compute layer.”

Recent initiatives, such as Alphabet’s “Project Suncatcher” and Nvidia’s partnership with Starcloud, underscore this shift.

Orbital Data Centers Hinge On Launch Costs

According to ARK, this concept hinges on launch costs. While “prohibitively high” in the past, the firm states that SpaceX's Starship “should change the game” when it becomes fully operational, which is expected to be around 2026.

The research points to Musk's suggestion that Starship could eventually “deliver 100 GW per year to high earth orbit” within five years, a figure that would revolutionize the energy available for computation.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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