SpaceX shares looked poised to fall again as US markets reopened after the long weekend, extending a slide that has already erased much of the euphoria from the largest stock-market debut in history.
The stock closed last week around $185, down roughly 18 per cent from the $225.64 it touched on 16 June, four days after listing on the Nasdaq under the ticker SPCX.
The round trip has been fast even by the standards of a hot IPO. SpaceX priced at $135 a share on 12 June, raising about $75bn, then rallied some 67 per cent over its first three sessions before a single quarterly report had landed.
It fell 5 per cent the following Wednesday and 3.6 per cent on Thursday, its first two-day decline as a public company, before the Juneteenth holiday paused trading.
Most of the explanation is mechanical rather than fundamental. Only a sliver of SpaceX is actually trading. Roughly 4 per cent of the shares are free to change hands, with the rest locked up under a staggered schedule that does not begin to ease until around the company’s first earnings report in the summer and does not fully clear until well into next year.
A float that thin amplifies everything: it helped send the stock up 67 per cent on modest volume, and it can just as easily work in reverse when sentiment turns.
Two things turned it. On 17 June, the first put options on SPCX began trading, handing sceptics a practical way to bet against a stock that, until then, had been nearly impossible to short because there were so few borrowable shares.
And the day before that, SpaceX disclosed it would buy Anysphere, the company behind the AI coding tool Cursor, for $60bn in an all-stock deal, an immediate dilution for anyone who had bought on the open market only days earlier.
The Cursor deal also sharpened a question hanging over the valuation. SpaceX priced at a level that implied a revenue multiple around 100 times, a number that only makes sense as a bet on Starlink, Starship, and the xAI artificial-intelligence operation the company merged with earlier this year, rather than on current earnings.
Spending $60bn of freshly public stock to bolt on an AI business, days after listing, told investors a great deal about where management thinks the growth has to come from, and about how much it is willing to dilute them to get it.
The numbers underneath the story are doing a lot of work. Starlink, the satellite-broadband arm that is the closest thing SpaceX has to a cash machine, brought in $11.4bn in revenue last year, but average revenue per user has been sliding, to about $66 a month in the first quarter from $86 a year earlier.
The company is unprofitable on a GAAP basis, with the xAI segment carrying a $4.9bn net loss, which is the gap between the price and the fundamentals that the bears keep pointing at.
A dual-class structure also leaves Elon Musk with roughly 79 per cent of the votes on about 42 per cent of the equity, so the open-market shareholders now absorbing the volatility have little say over the decisions driving it.
Not everyone was convinced the debut reflected the underlying company at all. Gary Black of The Future Fund described SPCX’s early trading as resembling a meme stock more than a security priced on fundamentals, a reading made easier by the absence of shorts and options in those first sessions.
Morningstar, less colourfully, had already pegged fair value at a fraction of the IPO price. Our coverage charted the same arc, from a heavily oversubscribed book to the record Nasdaq debut and then the first 6 per cent drop as the rally cooled.
The harder test is still ahead. The same lock-up structure that has kept supply scarce will start releasing shares over the coming months, and a stock that ran from $135 to $225 on a 4 per cent float will meet a very different market once the other 96 per cent can sell. For now, the slide is the rally running in reverse.
Whether SpaceX trades on its Starlink cash flows or on the story it sold at $135 is the question the next few months will settle.
