Defense spending increases in Europe and renewed military investment in the United States, partly influenced by President Donald Trump's Golden Dome missile defense program, are significantly changing the commercial space industry, according to investors and executives at a SpaceNews live event on October 8.

Mark Boggett, chief executive and general partner at Seraphim Space, stated, "Our industry and the outlook for space has very significantly changed during the course of 2025. What has changed in 2025? I think the answer to that question is Donald Trump. He’s the answer to a lot of questions at the moment."

Boggett highlighted the dramatic European response to evolving U.S. defense priorities. He noted, "There’s now a trillion euros of budget in that market with a very significant need to effectively wean off U.S. capability and create sovereign capability in Europe. This has created a massive tailwind. And that’s the biggest driver that I’m seeing at the moment."

European governments are directing unprecedented funds into space and defense ventures, fueled by both Trump-era policy changes and ongoing security concerns following Russia’s invasion of Ukraine. This funding focuses on surveillance, communications infrastructure, and military space projects aimed at ensuring strategic autonomy. Germany plans to invest approximately $41 billion by 2030 to enhance its space capabilities, contributing to a broader European effort to recognize space as a critical defense domain. This initiative has drawn in private capital.

"There’s more investors at the table," Boggett said. "There’s a lot of investors now that weren’t looking at defense a year ago that are now interested in this market. Dual-use is a relatively attractive way into the market."

In the United States, investors report a similar trend as companies prepare for Golden Dome, the Pentagon’s next-generation missile defense architecture expected to rely heavily on satellite assets.

Kirk Konert, managing partner at AE Industrial Partners, which has investments in companies such as Firefly Aerospace, York Space Systems, Sierra Space, Redwire, and All.Space, said, "I think that’s going to be a big driver for how space-based assets will be acquired, not just for Golden Dome, but how they will be acquired for other programs as well." Firefly's recent acquisition of SciTec, a defense analytics company, aims to expand its presence in national security programs, including Golden Dome.

Konert added, "The current environment is creating opportunities for new entrants in the commercial space sector. It’s providing a big opportunity for our portfolio companies and investors like us."

Executives indicate that the renewed focus on defense has reshaped investor sentiment. Konert remarked, "If you rewind 18 months ago, space and defense tech wasn’t one of the best ideas for institutional investors. Over this past year — and particularly in the last six months — defense tech and space tech are among their top ideas." He noted that falling interest rates have contributed to this trend.

Theresa Condor, chief executive of Spire Global, highlighted that the shift in government priorities has been evolving since Russia’s 2022 invasion of Ukraine, which demonstrated the potential of commercial space systems in supporting military operations. "It really showed everyone what commercial space can do in this kind of scenario, whether that’s related to communications or Earth observation," Condor said. She noted the increasing occurrence of anti-satellite interference, such as GPS jamming, not only in Eastern Europe but also in the Middle East.

Condor pointed to the 2025 Munich Security Conference as a pivotal moment when "everyone got much more worried about having to rely on the United States." This concern has spurred the growth of sovereign space systems, where nations own and operate their own satellites, ground stations, and networks.

These converging factors are driving a global increase in satellite communications, Earth observation, missile warning, and cybersecurity capabilities, subsequently increasing company valuations and encouraging consolidation.

"I think we’re still in the early innings of what we’re seeing as a long macro super cycle for defense tech spend and space tech spend globally," Konert concluded. Boggett concurred, stating, "We’re seeing a whole range of new investors involved, leading to more competition." This could pave the way for a new wave of acquisitions within the sector.