The unoccupied space-facing port on the International Space Station’s Harmony module is pictured several hours before the SpaceX Dragon Freedom spacecraft would relocate there after undocking from Harmony’s forward port.
NASA Johnson Space Center
In the race to conquer the cosmos, the greatest challenge to space exploration might be the vastness of the unknown, but that distance from planet Earth isn’t dissuading the invisible hands of cybercriminals aiming to sabotage missions from thousands of miles below.
Spacecraft, satellites, and space-based systems all face cybersecurity threats that are becoming increasingly sophisticated and dangerous. With interconnected technologies controlling everything from navigation to anti-ballistic missiles, a security breach could have catastrophic consequences.
“There are unique constraints to operating in space where you do not have physical access to spacecraft for repairs or updates after launch,” said William Russell, director of contracting and national security acquisitions at the U.S. Government Accountability Office. “The consequences of malicious cyber activities include loss of mission data, decreased lifespan or capability of space systems or constellations, or the control of space vehicles.”
Critical space infrastructure is susceptible to threats across three key segments: in space, on the ground segment and within the communication links between the two. A break in one can be a cascading failure for all, said Wayne Lonstein, co-founder and CEO at VFT Solutions, and co-author of Cyber-Human Systems, Space Technologies, and Threats. “In many ways, the threats to critical infrastructure on Earth can cause vulnerabilities in space,” Lonstein said. “Internet, power, spoofing and so many other vectors that can cause havoc in space,” he added.
AI risks in mission critical systems
The integration of artificial intelligence into space projects has heightened the risk of sophisticated cyber attacks orchestrated by state actors and individual hackers. AI integration into space exploration allows more decision-making with less human oversight.
For example, NASA is using AI to target scientific specimens for planetary rovers. However, reduced human oversight could make these missions more prone to unexplained and potentially calamitous cyberattacks, said Sylvester Kaczmarek, chief technology officer at OrbiSky Systems, which specializes in the integration of AI, robotics, cybersecurity, and edge computing in aerospace applications.
Data poisoning, where attackers feed corrupted data to AI models, is one example of what could go wrong, Kaczmarek said. Another threat, he said, is model inversion, where adversaries reverse-engineer AI models to extract sensitive information, potentially compromising mission integrity. If compromised, AI systems could be used to interfere with or take control of strategically important national space missions.
“AI systems may be susceptible to unique types of cyberattacks, such as adversarial attacks, where malicious inputs are designed to deceive the AI into making incorrect decisions or predictions,” Lonstein said. AI could also enable adversaries to “carry out sophisticated espionage or sabotage operations against space systems, potentially altering mission parameters or stealing sensitive information,” he added.
The Quetzal-1 CubeSat is seen as it deploys from the JEM Small Satellite Orbital Deployer aboard the International Space Station.
NASA Johnson Space Center
Worse yet, AI can be weaponized — used to develop advanced space-based weapons or counter-space technologies that could disrupt or destroy satellites and other space assets.
The U.S. government is tightening up the integrity and security of AI systems in space. The 2023 Cyberspace Solarium Commission reportstressed the importance of designating outer space as a critical infrastructure sector, urging enhanced cybersecurity protocols for satellite operators.
Lonstein recommends rigorous testing of AI systems in simulated space conditions before deployment, and redundancy as a way to safeguard against an unexpected breach. “Implement redundant systems to ensure that if one AI component fails, others can take over, thus maintaining mission integrity and functionality,” he said.
Use of strict access controls, authentication, and error correction mechanisms can further ensure that AI systems operate with accurate information. There are reactive measures for when even these defenses have been breached, through the design of AI systems with fail-safe mechanisms that can revert to a “safe state” or “default mode” in the event of a malfunction or unexpected behavior, Lonstein said. Manual override is important, too. “Ensure that ground control can manually override or intervene in AI decision- making, when necessary, providing an additional layer of safety,” he added.
U.S.-China competition
The rivalry between the U.S. and China includes the new battleground of space. As both nations ramp up their space ambitions and militarized capabilities beyond Earth’s atmosphere, the threat of cyberattacks targeting critical orbital assets has become an increasingly pressing concern.
“The competition between the U.S. and China, with Russia as a secondary player, heightens the risk of cyberattacks as these nations seek to gain technological superiority,” Kaczmarek said.
Though they don’t garner as much attention in the mainstream press as consumer, crypto or even nation-state hacks against key U.S. private and government infrastructure on the ground, notable cyberattacks have targeted critical space-based technologies in recent years. With the U.S., China, Russia and India intensifying their push for space dominance, the stakes have never been higher.
“Nations like China and Russia target U.S. space assets to disrupt operations or steal intellectual property, potentially leading to compromised missions and a loss of technological edge,” Kaczmarek said.
Space-based systems increasingly support critical infrastructure back on Earth, and any cyberattacks on these systems could undermine national security and economic interests. Last year, the U.S. government let hackers break into a government satellite as a way to test vulnerabilities that could be exploited by the Chinese. That came amid growing concerns at the highest levels of the government that China is attempting to “deny, exploit or hijack” enemy satellites — revelations that became public in the leak of classified documents by U.S. Air National Guardsman Jack Teixeira in 2023.
“The ongoing space race and the associated technologies will continue to be impacted by Viasat-like cyberattacks,” said GAO’s Russell, referring to a 2022 cyberattack against the satellite company attributed by U.S. and U.K. intelligence to Russia as part of its war against Ukraine.
Big Tech’s space-based cloud
Private companies and the government will need to use all the cybersecurity tools at their disposal, including encryption, intrusion detection systems, and collaboration with government agencies like the Cybersecurity and Infrastructure Security Agency for intelligence sharing and coordinated defense.
“These collaborations can also involve developing cybersecurity frameworks specifically tailored to space systems,” Kaczmarek said.
At the same time, Silicon Valley-based tech companies have been making rapid advancements in the field of cybersecurity, including those designed to secure space technologies. Companies like Microsoft, Amazon, Google, and Nvidia are increasingly being enlisted by the U.S. Space Force and Department of Defense for their specialized resources and advanced cyber capabilities.
Notably, Microsoft is a founding member of the Space Information Sharing and Analysis Center and has been an active participant since its formation several years ago. “Microsoft has partnered with the U.S. Space Force to support their growth as a fully digital service, bringing the latest technologies to ensure Space Force Guardians are prepared for space-based conflicts,” said a Microsoft spokesperson via email.
As part of the $19.8 million contract, Microsoft provides its Azure cloud computing infrastructure, simulations, augmented reality, and data management tools to support and secure a wide range of Space Force missions. “Microsoft is playing a key role in defending against cyber threats in space,” the spokesperson wrote.
Google Cloud, Amazon Web Services and defense contractor General Dynamics also offer cloud infrastructure for storing and processing vast amounts of data generated by satellites and space missions.
Nvidia‘s powerful GPUs can be used for processing and analyzing satellite imagery and data. According to Lonstein, the chipmaker’s AI chips can enhance image processing, anomaly detection, and predictive analytics for space missions. But there is a limit to reliance on technology in space operations as a safety benefit rather than added layer of risk.
“High dependency on automated systems can lead to catastrophic failures if those systems malfunction or encounter unexpected scenarios,” Lonstein said.
A single point of failure could compromise the entire mission. Moreover, extensive use of technology could be detrimental to human operators’ skills and knowledge, which might atrophy if not regularly exercised.
“This could lead to challenges in manual operation during emergencies or system failures,” Lonstein added.
Startup Figure AI is developing general-purpose humanoid robots.
Figure AI
Figure AI, an Nvidia-backed developer of humanoid robots, was sued by the startup’s former head of product safety who alleged that he was wrongfully terminated after warning top executives that the company’s robots “were powerful enough to fracture a human skull.”
Robert Gruendel, a principal robotic safety engineer, is the plaintiff in the suit filed Friday in a federal court in the Northern District of California. Gruendel’s attorneys describe their client as a whistleblower who was fired in September, days after lodging his “most direct and documented safety complaints.”
The suit lands two months after Figure was valued at $39 billion in a funding round led by Parkway Venture Capital. That’s a 15-fold increase in valuation from early 2024, when the company raised a round from investors including Jeff Bezos, Nvidia, and Microsoft.
In the complaint, Gruendel’s lawyers say the plaintiff warned Figure CEO Brett Adcock and Kyle Edelberg, chief engineer, about the robot’s lethal capabilities, and said one “had already carved a ¼-inch gash into a steel refrigerator door during a malfunction.”
The complaint also says Gruendel warned company leaders not to “downgrade” a “safety road map” that he had been asked to present to two prospective investors who ended up funding the company.
Gruendel worried that a “product safety plan which contributed to their decision to invest” had been “gutted” the same month Figure closed the investment round, a move that “could be interpreted as fraudulent,” the suit says.
The plaintiff’s concerns were “treated as obstacles, not obligations,” and the company cited a “vague ‘change in business direction’ as the pretext” for his termination, according to the suit.
Gruendel is seeking economic, compensatory and punitive damages and demanding a jury trial.
Figure didn’t immediately respond to a request for comment. Nor did attorneys for Gruendel.
The humanoid robot market remains nascent today, with companies like Tesla and Boston Dynamics pursuing futuristic offerings, alongside Figure, while China’s Unitree Robotics is preparing for an IPO. Morgan Stanley said in a report in May that adoption is “likely to accelerate in the 2030s” and could top $5 trillion by 2050.
Concerns about stock valuations in companies tied to artificial intelligence knocked the market around this week. Whether these worries will recede, as they did Friday, or flare up again will certainly be something to watch in the days and weeks ahead. We understand the concerns about valuations in the speculative aspects of the AI trade, such as nuclear stocks and neoclouds. Jim Cramer has repeatedly warned about them. But, in the past week, the broader AI cohort — including real companies that make money and are driving what many are calling the fourth industrial revolution — has been getting hit. We own many of them: Nvidia and Broadcom on the chip side, and GE Vernova and Eaton on the derivative trade of powering these energy-gobbling AI data centers. That’s not what should be happening based on their fundamentals. Outside of valuations, worries also center on capital expenditures and the depreciation that results from massive investments in AI infrastructure. On this point, investors face a choice. You can go with the bears who are glued to their spreadsheets and extrapolating the usable life of tech assets based on history, a seemingly understandable approach, and applying those depreciation rates to their financial models, arguing the chips should be near worthless after three years. Or, you can go with the commentary from management teams running the largest companies driving the AI trade, and what Jim has gleaned from talking with the smartest CEOs in the world. When it comes to the real players driving this AI investment cycle, like the ones we’re invested in, we don’t think valuations are all that high or unreasonable when you consider their growth rates and importance to the U.S., and by extension, the global economy. We’re talking about Nvidia CEO Jensen Huang, who would tell you that advancements in his company’s CUDA software have extended the life of GPU chip platforms to roughly five to six years. Don’t forget, CoreWeave recently re-contracted for H100s from Nvidia, which were released in late 2022. The bears with their spreadsheets would tell you those chips are worthless. However, we know that H100s have held most of their value. Or listen to Lisa Su, CEO of Advanced Micro Devices , who said last week that her customers are at the point now where “they can see the return on the other side” of these massive investments. For our part, we understand the spending concerns and the depreciation issues that will arise if these companies are indeed overstating the useful lives of these assets. However, those who have bet against the likes of Jensen Huang and Lisa Su, or Meta Platforms CEO Mark Zuckerberg, Microsoft CEO Satya Nadella, and others who have driven innovation in the tech world for over a decade, have been burned time and again. While the bears’ concerns aren’t invalid, long-term investors are better off taking their cues from technology experts. AI is real, and it will increasingly lead to productivity gains as adoption ramps up and the technology becomes ingrained in our everyday lives, just as the internet has. We have faith in the management teams of the AI stocks in which we are invested, and while faith is not an investment strategy, that faith is based on a historical track record of strong execution, the knowledge that offerings from these companies are best in class, and scrutiny of their underlying business fundamentals and financial profiles. Siding with these technology expert management teams, over the loud financial expert bears, has kept us on the right side of the trade for years, and we don’t see that changing in the future. (See here for a full list of the stocks in Jim Cramer’s Charitable Trust, including NVDA, AVGO, GEV, ETN, META, MSFT.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. Markets: The S & P 500 bounced back Friday, recovering from the prior session’s sharp losses. The broad-based index, which was still tracking for a nearly 1.5% weekly decline, started off the session a little shaky as Club stock Nvidia drifted lower after the open. It was looking like concerns about the artificial intelligence trade, which have been dogging the market, were going to dominate back-to-back sessions. But when New York Federal Reserve President John Williams suggested that central bankers could cut interest rates for a third time this year, the market jumped higher. Rate-sensitive stocks saw big gains Friday. Home Depot rose more than 3.5% on the day, mitigating a tough week following Tuesday’s lackluster quarterly release. Eli Lilly hit an all-time high, becoming the first drugmaker to reach a $1 trillion market cap. TJX also topped its all-time high after the off-price retailer behind T.J. Maxx, Marshalls, and HomeGoods, delivered strong quarterly results Wednesday. Carry trade: We’re also monitoring developments in Japan, which is dealing with its own inflation problem and questions about whether to resume interest rate hikes. That brings us to the popular Japanese yen carry trade, which is getting squeezed as borrowing costs there are rising. The yen carry trade involves borrowing yen at a low rate, then converting them into, say, dollars, and investing in higher-yielding foreign assets. That’s all well and good when the cost to borrow yen is low. It’s a different story now that borrowing costs in Japan are hitting 30-year highs. When rates rise, the profit margin on the carry trade gets crunched, or vanishes completely. As a result, investors need to get out, which means forced selling and price action that becomes divorced from fundamentals. It’s unclear if any of this is adding pressure to U.S. markets. We didn’t see anything in the recent quarterly earnings reports from U.S. companies to suggest corporate fundamentals are deteriorating in any meaningful way. That’s why we’re looking for other potential external factors, alongside the well-known concerns about artificial intelligence spending, the depreciation resulting from those capital expenditures, and general worries about consumer sentiment and inflation here in America. Wall Street call: HSBC downgraded Palo Alto Networks to a sell-equivalent rating from a hold following the company’s quarterly earnings report Wednesday. Analysts, who left their $157 price target unchanged, cited decelerating sales growth as the driver of the rerating, describing the quarter as “sufficient, not transformational.” Still, the Club name delivered a beat-and-raise quarter, which topped estimates across every key metric. None of this stopped Palo Alto shares from falling on the release. We chalked the post-earnings decline up to high expectations heading into the quarter, coupled with investor concerns over a new acquisition of cloud management and monitoring company Chronosphere. Palo Alto is still working to close its multi-billion-dollar acquisition of identity security company CyberArk , announced in July. HSBC now argues the stock’s risk-versus-reward is turning negative, with limited potential for upward estimate revisions for fiscal years 2026 and 2027. We disagree with HSBC’s call, given the momentum we’re seeing across Palo Alto’s businesses. The cybersecurity leader is dominating through its “platformization” strategy, which bundles its products and services. Plus, Palo Alto keeps adding net new platformizations each quarter, converting customers to use its security platform, and is on track to reach its fiscal 2030 target. We also like management’s playbook for acquiring businesses just before they see an industry inflection point. With Chronosphere, Palo Alto believes the entire observability industry needs to change due to the growing presence of AI. We’re reiterating our buy-equivalent 1 rating and $225 price target on the stock. Up next: There are no Club earnings reports next week. Outside of the portfolio, Symbotic, Zoom Communications , Semtech , and Fluence Energy will report after Monday’s close. Wall Street will also get a slew of delayed economic data during the shortened holiday trading week. U.S. retail sales and September’s consumer price index are scheduled for release early Tuesday. Durable goods orders and the Conference Board consumer sentiment are released on Wednesday morning. (See here for a full list of the stocks in Jim Cramer’s Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.