Northrop Grumman is a play on this underrated growth industry

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While SpaceX is launching many satellites, Northrop is going to repair them

Satellite servicing, a growth industry in its infancy, is an important industry within the space sector. While SpaceX is launching hundreds of satellites, Northrop and its smaller competition, Astroscale, is looking to repair the many aging satellites orbiting the Earth since the 80s (or even earlier).

As the name implies, the satellite servicing industry focuses on extending the lifespan of satellites through maintenance and refueling. Many world leaders are pushing for the industry to grow because they don’t want the Earth to be littered with many inoperable satellites. Also, because creating satellites requires the usage of many rare elements, prolonging the lifespan of satellites helps the industry conserve those elements.

The approaches Northrop Grumman and Astroscale take are different. Northrop is building new servicing satellites to attach onto older satellites and prolong their usefulness in space. On the other hand, Astroscale is looking to take nonfunctioning satellites out of space and either repair them or use the parts to create an entirely new and improved satellite. Both are great ways of adding sustainability to the space industry as well as making Earth’s exosphere less crowded.

Currently, satellite companies are willing to pay big bucks to have satellite servicing on their older satellites. Intelsat said that they plan to pay Northrop Grumman $13 million a year for five years just to give servicing to one of their satellites. With companies like SpaceX planning to launch tens of thousands of satellites, it looks like there’ll be more business for Northrop’s satellite servicing business in the future.

With Northrop Grumman being the only publicly-traded company involved with this industry, then it looks like our only option to capitalize on that industry (unless you’re an institutional investor that can find a way to invest in Astroscale).

Meanwhile, there are many satellites that could use servicing.