SpaceX’s Blockbuster IPO Comes Crashing Back To Earth
Barely a month after the largest initial public offering in history briefly made SpaceX one of the world’s most valuable companies, its shares have fallen below the offer price and turned a market spectacle into a test of investor faith in Elon Musk’s most ambitious enterprise.
SpaceX shares were trading around $123.54 on Wednesday, roughly 23% below their first-day close and beneath the $135 IPO price. The reversal followed a euphoric debut that raised a record $75 billion and briefly valued the rocket and satellite company above $2 trillion. Investors are now confronting the less glamorous facts beneath the excitement: SpaceX remains unprofitable, faces enormous capital requirements and must prove that Starship, Starlink and its proposed orbital computing ventures can justify a valuation more commonly associated with mature technology giants.
The selloff may become more difficult in August, when billions of dollars of previously restricted shares begin to qualify for sale and SpaceX releases its first public earnings report. The company still dominates commercial launch and owns a fast-growing global communications network, so the decline does not settle its long-term prospects. It does, however, show how quickly market mythology can reverse when scarcity, celebrity and fear of missing out give way to ordinary questions about cash flow, competition and execution.
