Over to you, Eric…

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Hello, Reader.

Surprising developments are rarely the norm, yet science often takes unexpected turns.

In 1998, a revelation unveiled by astronomers led to a Nobel Prize-winning insight: the expansion of the universe isn't merely ongoing—it's accelerating.

This contradicted a longstanding assumption that cosmic gravity would gradually decelerate expansion. As Edwin Hubble noted in 1929, the universe was expanding, and it seemed reasonable to assume gravity would act to slow this down over time.

To test this, scientists observed distant supernovae—luminous cosmic events—with predictable brightness levels. By measuring their apparent luminosity relative to their actual brightness, astronomers gauged distances in the universe.

The outcome defied predictions: supernovae appeared fainter than expected, indicating they were positioned farther away. Gravity wasn’t slowing expansion; rather, some unknown force was accelerating it.

Further validation came from the Hubble Space Telescope, which confirmed accelerating expansion rates of about 5% to 9% beyond existing models' expectations.

Now, we’re witnessing another, more immediate type of expansion—one that could significantly impact investors.

The global space economy has surged to an impressive $613 billion, and projections from Johns Hopkins suggest it may hit $1.8 trillion within ten years. This growth is driven by reusable rocket technology, increased private sector investment, decreasing launch costs, and emerging businesses that previously felt like fiction.

Artificial intelligence plays a pivotal role, propelling this expansion even further.

AI contributes to spacecraft design, processing extensive satellite data, automating missions, and even fostering data center operations in space. The concept of space as mere transport has evolved—it is now being viewed as vital infrastructure for cutting-edge computing.

And this brings us to Space Exploration Technologies Corp. (SPCX).

This week, we gained insights into the public company’s financials. What we found was a firm whose ambitions stretch beyond traditional rocket launches or satellite communications—it's aggressively investing in AI infrastructure.

SpaceX reported $7.8 billion in revenue for the second quarter, a staggering 92% increase from the previous year. However, this came at a cost: nearly $16 billion was poured into expanding AI infrastructure, resulting in a quarterly loss of $541 million.

In a revealing moment during the earnings call, Elon Musk identified the constraint limiting this expansion not as financial barriers, access to capital, or even the shortage of advanced AI chips.

His stark statement: “The limiting factor currently is memory.” This insight could carry far-reaching implications, more significant than many are recognizing.

Musk's identification of memory shortages highlights a critical supply-demand gap impacting the tech industry broadly. A select group of companies that can supply this essential memory may just hold the key to navigating this shortage effectively, benefiting from surging demand, reduced competition, escalating prices, and unparalleled pricing power.

My aim today is not just to illustrate why Musk sees memory as a bottleneck for AI but to spotlight the investment opportunities arising from this very shortage.

As the conversation evolves, I’ll introduce a memory firm I see as a strong candidate to thrive in this market, along with three additional stocks that merit attention long before Wall Street fully comprehends the potential.

Looking Ahead