Key Takeaways SpaceX soared after its IPO, then fell as valuation concerns and broader tech weakness hit sentiment.SPCX faces price-discovery volatility, with lock-up expirations potentially adding selling pressure.SpaceX's AI data center deals aid revenue outlook, but analysts see premium valuation as a key risk. Founded by Elon Musk in 2002, Space Exploration Technologies Corp., or SpaceX, debuted on the Nasdaq under the ticker (SPCX - Free Report) on June 12, in a historic initial public offering (IPO). Headquartered at the Starbase development site in Starbase, TX, the rocket, satellite and AI company raised $75 billion from its record-breaking IPO.
The stock increased by 19% from its initial price of $135 per share, within 24 hours of going public. A surge in SpaceX's stock price after its blockbuster debut made Musk the first person with a net worth of more than $1 trillion.
After a flying start, the stock has given back most of the gains, falling about 20% in a week and slipping below its $150 debut price before recovering slightly. Bearish momentum in the broader market led to sharp declines in technology and AI stocks, like Alphabet (GOOGL - Free Report) and Amazon (AMZN - Free Report) . Profit-booking and concerns about SPCX's valuation have weighed heavily on investor sentiment. There are also growing concerns among market participants about an AI bubble that could destabilize markets, particularly if the Federal Reserve proceeds with interest rate increases.
SpaceX carries a valuation of nearly $2 trillion despite generating less than $19 billion in annual revenues, leaving little room for disappointment. Looking ahead, there could be more volatility as SpaceX enters its price-discovery phase. Investors are also watching upcoming insider lock-up expirations, which could release millions of additional shares into the market and increase sales pressure. While the company has ambitious plans spanning reusable rockets, Starlink, AI data centers, and even space-based computing infrastructure, many of those projects remain long-term bets that will require enormous investments before producing meaningful returns.
Still, not everyone believes the story is turning negative. Some analysts argue that the recent sell-off is simply part of the normal price discovery process that follows major IPOs, especially one with such a limited public float. Although new AI data center deals have strengthened its revenue outlook, many analysts believe its premium valuation erases cause for concern, making the stock a high-risk bet despite its long-term potential.
SpaceX currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.
HomeIndustriesAerospace/DefenseThe company says it is buying Iridium Communications as a ‘shortcut’ to expanding its growing capabilitiesJune 29, 2026, 10:07 a.m. ET
Rocket Lab said Monday it plans to acquire Iridium Communications, positioning the expanding company as a head-on rival to SpaceX and its Starlink satellite-communications business.
The “historic” acquisition will make Rocket Lab RKLB a “fully vertically integrated space powerhouse primed for growth,” the company said in a statement. It will give the company a foothold in a variety of space-based applications, including direct-to-device communications, Rocket Lab said.
SpaceX's $25 billion foray into debt markets appeared to be well received by bond markets last week, with huge demand for the offering.
But one of the biggest-ever AI bond issuances, less than two weeks after SpaceX's IPO, has highlighted the group's intense financing needs, capital spending plans and future refinancing obligations — and posed a diversification challenge for investors.
Why SpaceX tapped debt marketsThe group tapped debt markets on June 22, announcing a senior unsecured notes offering, with sources telling CNBC that the company was looking to raise $20 billion, which was then increased to $25 billion. The company said it would use the net proceeds to "repay the outstanding borrowings under its bridge loan facility in full, to pay related fees and expenses, and any remaining amount for general corporate purposes."
SpaceX stock soared after its hotly-anticipated IPO. Last week's debt issuance dented investor confidence.
SpaceX received nearly $90 billion worth of orders, people familiar with the fundraising previously told CNBC. They asked not to be named because the details are private.
But the move appeared to unnerve equity investors, with SpaceX falling more than 13% for the week after a strong post-IPO run.
Chris Beauchamp, chief market analyst at IG, said SpaceX will increasingly have to "work hard to make itself heard," adding there are plenty of offerings from more profitable concerns that can steal the limelight.
"Equity investors are one thing, but bond guys are the grown-ups in the room," Beauchamp told CNBC via email. "SpaceX might find it has its work cut out for it, but I suspect the market can absorb the issuance overall."
"The timing certainly isn't great, but we have seen brief bouts of panic like this before, and the wagon tends to roll onwards in the end."
Christopher Della Fave, senior vice president, capital markets at Post Oak Group, said: "Two weeks after the largest IPO in history, SpaceX is already tapping debt markets while carrying a $5 billion net loss and capex that more than doubled year over year."
Why SpaceX bonds raise diversification questionsDella Fave said SpaceX's losses and high capital expenditure aren't "alarming" in isolation, as "capital-intensive growth companies run hot."
However, he highlighted "the structural issue" that "investors aren't pricing in."
"Owning SPCX equity and SpaceX bonds isn't diversification," Della Fave added. "It's the same execution risk across two instruments."
"Starlink has to scale. Starship has to work. Both the equity story and the debt service depend on it. For portfolio construction, we treat total SpaceX exposure as a single concentrated position regardless of instrument, the same way you'd approach any single-name technology bet dressed up as a multi-asset allocation."
SpaceX's multi-billion-dollar debt issuance means many investors have become exposed to the group via two different asset classes – equities, via its blockbuster IPO on June 12 – and now, corporate bonds.
"Nearly all investors already hold allocations to US technology and the purpose of bonds as an asset class is surely to diversify," Julian Howard, multi-asset head at Gam, told CNBC on Friday.
He pointed out that SpaceX's 10-year issue is trading at a relatively tight spread to the equivalent U.S. Treasury of 1.4 percentage points.
In the debt sale, SpaceX priced bonds in five different tranches, with notes due between 2031 and 2056. Rates vary from 5.35% for the 2031 bonds to 6.65% for the 2056 notes.
"While that is comfortably ahead of inflation, the risk will be that spreads will widen if there is any hint of SpaceX not meeting its ambitious revenue targets, or if the outlook for tech and AI falters in any way," he added.
In the long term, SpaceX faces two big challenges in the markets, said Morningstar chief investment officer Mike Coop.
"Firstly, the supply of shares will go up as early investors lighten up exposures and monetize gains," he told CNBC.
"Secondly, the current price is too high given the massive uncertainty around the company's prospects and its starting point of being heavily loss making and requiring huge capital investment."
Key Takeaways Nasdaq on Friday said SpaceX will join the Nasdaq 100 index on Monday, July 7.The move means shares of Elon Musk's company will soon be added to popular index-tracking funds like the Invesco QQQ Trust. Get personalized, AI-powered answers built on 27+ years of trusted expertise.
Shares of SpaceX rose premarket Monday, advancing following the news that the company will soon be added to an influential tech index.
SpaceX (SPCX) stock was recently up 1.5% at above $155. Nasdaq late Friday said the company will join the Nasdaq 100 index before the open on Monday, July 7.1 The move follows five other changes to the index announced earlier this month as part of periodic rebalancing.2
The move was widely expected after Nasdaq and other index providers made moves ahead of the company's June 12 IPO to speed the path of mega-IPOs—including SpaceX, but also expected offerings from companies like Anthropic and OpenAI— into their measures. Still, investors have watched closely for confirmation of the changes, seen as giving the shares a boost because of buying by funds that track the index; the Invesco QQQ Trust (QQQ) is the most widely known.
A number of indexes had already added SpaceX, leading to buying from funds at Vanguard, BlackRock, and other asset managers. Active managers are also buying: Several of Cathie Wood's Ark Investment Management funds, including the flagship Ark Innovation ETF (ARKK), bought shares on Friday, according to trade disclosures.
SpaceX shares finished last week a bit above $153, leaving them little changed after two weeks of trading relative to the price where they first opened. It's been a busy two weeks, with the stock so far both rising above $226 and dipping below that $150 open price. They've yet to approach their $135 IPO price, though.
Elon Musk said SpaceX would release new AI models "trained from scratch" every month. WEF/Getty images It's all hands on deck at SpaceX as the company plays catch-up in the AI race.
Elon Musk said on Sunday that SpaceX had deployed "a few dozen" top Starlink and Starship engineers to help overhaul its Grok model.
"The SpaceXAI cadence of model and harness improvement is speeding up tremendously, particularly due to a few dozen of the top Starlink/Starship engineers shifting much of their time to AI," wrote Musk in a post on X.
The billionaire added that engineers from Cursor, the AI coding startup that SpaceX agreed this month to buy for $60 billion, were also working on the new foundation model, which was partly trained on Cursor training data.
Musk said that Grok 4.5, the latest version of the chatbot, was now in private beta at Tesla and SpaceX, and posted that SpaceX would release new models "trained from scratch" every month this year.
Musk's efforts to take the lead in the AI race have faced roadblocks in the past few months.
The Tesla CEO overhauled xAI, the AI startup he founded in 2023 to take on OpenAI and Google, earlier this year in a sweeping reorganization that saw the last of the company's 11 cofounders depart.
XAI's Grok has lagged rival AI models from OpenAI and Anthropic, especially on coding, and Musk wrote in March that xAI was "being rebuilt from the foundations up."
In February, Musk merged xAI with SpaceX, and the deal to acquire Cursor was confirmed shortly after the rocket company's record-breaking $85 billion IPO earlier this month.
The deal cemented the meteoric rise of Cursor, an AI coding startup led by 25-year-old Michael Truell, and saw SpaceX grant Cursor access to the company's supercomputers in return for help training Grok.
Deploying top Starlink and Starship engineers to overhaul Grok is the latest sign that SpaceX is going all in on AI. Musk has said the company will use the windfall from its mega-IPO to build a network of up to a million orbital data centers, built on Starlink technology and carried into space by Starship, that will train and run increasingly advanced AI models.
In its investor materials presented before the IPO, SpaceX estimated its total addressable market was worth $28.5 trillion, of which AI accounts for $26.5 trillion.
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For most of its lifetime, Space Exploration Technologies (SPCX +0.13%) has been a rocket stock: The first private company to put a rocket in orbit, the first to launch and then land a rocket -- then launch it again -- and the company that cut the cost of spaceflight by as much as 75%.
These were SpaceX's claims to fame.
Then came the SpaceX IPO, and with it, the publication of SpaceX's IPO prospectus. When SpaceX at long last revealed its financial data to the world, it became obvious to investors that SpaceX might be an artificial intelligence company (because SpaceX hopes to make most of its money from xAI). Or SpaceX might be a satellite communications company (because Starlink is SpaceX's only profitable division).
But the one thing investors can no longer think about SpaceX is that it's a rocket company.
Image source: The Motley Fool.
Read the prospectus Or can you? Digging deep into the SpaceX prospectus last week (and skipping past the AI parts, which do not interest me at all), I stumbled upon a surprising revelation:
Yes, the Starlink "Connectivity" business is amazingly profitable for SpaceX, generating $4.4 billion in operating profit last year. Yes, the "Space" (i.e., rockets) business appears to be faltering, flipping from a $21 million profit in 2024 to a $657 million operating loss in 2025.
But the reason why is that SpaceX is subsidizing Connectivity at SpaceX.
And it's doing this on purpose.
The secret truth about SpaceX's rockets Here's how SpaceX describes this:
For launches of our Starlink satellites, the Company does not recognize any inter-segment revenue, rather those launch costs are capitalized in satellites in Property, plant, and equipment, net. We allocate a significant amount of launch capacity to our Connectivity segment, and expect to allocate a significant amount to our AI segment in the future. Our Space segment revenue only reflects our customer launches and customer activities.
Furthermore:
For launches dedicated to deploying our Starlink satellites, we capitalize the associated costs within our Connectivity segment and depreciate them over time, and we do not recognize revenue for those launches in our Space segment.
What does this mean? A few things, actually.
SpaceX's Space business is more profitable than you think For one, it tells us that out of the 170 rocket launches that Space conducted in 2025, of which 122 were launches of Starlink satellites and five were Starship test flights, SpaceX only actually charged anyone for 43 launches. An investor can't simply divide Space's $4.4 billion in revenue by 170 launches and conclude that SpaceX is making $26 million per launch. Instead, one must divide $4.4 billion by the only 43 launches for which SpaceX charged anyone anything.
And that results in an average launch price of $102 million.
And Starlink may be less profitable than it appears SpaceX's Prospectus also tells us that when launching a Starlink satellite, instead of Space charging Connectivity upfront for that launch, Connectivity counts the launch as part of the cost of building the satellite. Then Connectivity depreciates the satellite (and the launch) over time.
This doesn't necessarily lower Connectivity's costs, because the cost is still there. But it does lower Space's revenue, because Space is getting zero revenue from launches it performs for Connectivity.
Image source: SpaceX.
What this means for investors Translation: Despite the apparent lack of profits, Space could be an incredibly profitable business for SpaceX if SpaceX allowed it. If Space were to charge $102 million per launch, times 170 launches a year, it would be raking in $17.3 billion in revenue annually -- instead of just $4.4 billion.
This would almost certainly turn Space profitable.
But what about Connectivity -- the apparent powerhouse providing all of SpaceX's profits? In the short term, absorbing launch costs into the construction cost of Starlink satellites boosts profitability. This is because the launch cost isn't recognized and subtracted from profit immediately, but instead spread out and depreciated over each Starlink satellite's five-year lifespan.
So what's the upshot? Does this mean SpaceX's Connectivity profits are "fake?"
No.
Not fake, exactly, but rather front-loaded. As Starlink satellites are depreciated over time, they'll weigh more and more on the Connectivity division's profitability. If you're not just in SpaceX stock for the momentum trading, but plan to hold it as a long-term investment, this is something you'll want to keep in mind.
I'd also point out that SpaceX's approach makes sense from a "telecom stock" perspective. Rival telcos such as Verizon, AT&T, and Comcast also build long-lived assets that both generate revenue and depreciate over time. (In their case, it's just fiber and cable wires instead of satellites for SpaceX.)
These terrestrial telcos still manage to earn operating profit margins of 15% (AT&T) to 23% (Verizon), according to data from S&P Global Market Intelligence. SpaceX may not be able to maintain its own 38.6% operating margin at Connectivity, but it might still do as well as or even better than its rivals.
We'll need to keep close track of the numbers, though, to see how this works out over time -- because as it turns out, the most important favor SpaceX's launch business does for Starlink isn't just launching satellites.
It didn't take long for Space Exploration Technologies (SPCX +0.13%), popularly known as SpaceX, to make a major move after its initial public offering. Fresh off raising $86 billion from the IPO, it announced that it's acquiring Anysphere, the developer of the AI-powered code editor Cursor. It's a $60 billion purchase that will be paid for entirely in new shares of SpaceX stock, and it's expected to close in the third quarter. Here's why that's a big deal, and what it means for shareholders.
The $26.5 trillion opportunity There are various reasons investors are enthusiastic about SpaceX, but its artificial intelligence (AI) business probably doesn't top the list. People are excited about Elon Musk, his vision for a multiplanetary humanity, space travel, and even the Starlink satellite broadband business. But SpaceX only acquired xAI -- the part of the company that holds its AI segment -- earlier this year, and while it generated $818 million in revenue in 2026's first quarter, it also reported a $2.5 billion operating loss.
Image source: Getty Images.
However, an investment in SpaceX really is an investment in AI. Musk and Co. view the company as having what they say is "the largest actionable total addressable market in human history" -- $28.5 trillion.
And if you think that's all based on space and satellites, it's actually nearly all based on their outlook for AI. The company asserts that it has $26.5 trillion in AI opportunities, and $22.7 trillion of that is in "enterprise applications."
If that sounds incredible, it's worth keeping in mind that the entire U.S. gross domestic product for 2026 will be about $31 trillion.
What Cursor brings to the table xAI's business is nothing to sneeze at, though. Its large language model, Grok, is one of the most widely used LLMs. Although it's more heavily used by individual users, xAI has Grok deals with large customers like the U.S. Department of Defense and prediction market sites Kalshi and Polymarket, and the LLM is built into Tesla electric vehicles.
However, it faces fierce competition from leading rivals like Anthropic's Claude, OpenAI's ChatGPT, and Alphabet's Gemini. Musk himself described Grok as being in fifth place in the space, with China's open-source Deepseek in fourth place. All of these tools presumably are competing for slices of the same total addressable market.
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Cursor is an autonomous coding agent, and many high-profile companies have deals to use it, including Nvidia. These are the enterprise deals that Musk is after. Anysphere also has an annualized revenue of $4 billion, which will pad SpaceX's top line.
SpaceX stock still looks overvalued, and the addition of Cursor's revenue won't help the company turn a profit overnight. But it does bring the company some important AI capabilities and make it more financially sound. That could help it get closer to becoming investment-worthy at some point in the future.
SpaceX stock NASDAQ:SPCX has had a wild first few weeks as a public company.
The shares, priced at $135 in the company’s record June 12 IPO, surged to an intraday high of $225.64 by June 16, and then slid to around $153 by June 27.
That is a drop of roughly 32% from the peak, even though the stock is still above its IPO price.
The first thing investors need to separate is price from value.
A stock falling 32% can feel cheap because it is no longer trading at its recent high. But that does not automatically mean the valuation makes sense.
As per market data, SpaceX was still trading at about 107 times 2025 sales after the pullback.
That is an extreme multiple, even by the standards of AI and space-infrastructure stocks. Nvidia, by comparison, recently traded at roughly 21 times sales.
The financial picture also shows why some investors are cautious. SpaceX lost $4.9 billion in 2025, even as revenue reached $18.7 billion.
The business is growing fast, led by Starlink and its launch dominance, but it is not yet profitable at the group level.
That is the core bear-case argument. SpaceX may be one of the most exciting companies ever to hit the public market, but the stock is still priced for years of huge execution wins.
Morningstar’s Nicolas Owens has one of the clearest cautious views on the stock.
The analyst gave the company credit for its launch cost advantage, Starlink’s scale and the possibility of orbital AI infrastructure. It still comes out well below where the market is trading the stock.
Owens wrote that SpaceX shares are likely to look “overvalued in almost any scenario, at least in the near term”.
Morningstar also said long-term investors may get “more margin of safety” later, when lockups expire and more shares become available for sale.
That lockup point is important as SpaceX has a small public float, meaning only a limited portion of its shares can currently trade.
When supply is tight and demand is intense, prices can swing violently.
As more insider and employee shares become eligible for sale later this year, the market will get a better test of where natural demand really sits.
None of this means SpaceX is an empty story.
The company dominates the global space launch. As per analyst estimates, SpaceX launched 83% of the mass sent to orbit from Earth in 2025, nearly 10 times more than its nearest competitor.
Starlink is another pillar of the bull case. The satellite broadband business has become SpaceX’s clearest path to near-term cash generation, helped by its ability to launch satellites at in-house cost.
Starlink is expected to remain the company’s main cash-flow engine in the medium term, the analysts noted.
Index demand may also support the shares in the short term as SpaceX is being added to Russell indexes and will join the Nasdaq 100 on July 7, forcing passive funds that track those benchmarks to buy the stock.
Even after its sharp pullback, Space Exploration Technologies' (SPCX +0.15%) market cap still hovers around $2 trillion. That's an astronomical (no pun intended) valuation for a company that generated revenue of $18.7 billion last year and posted a loss of nearly $5 billion.
Could SpaceX double anytime soon? It's highly unlikely. Maybe over a long period of time, the company will open up exciting new markets that could lead to its share price gaining 100% or more. However, its premium pricing and the prospects of near-term insider selling after the lockup period expires present significant hurdles to the stock doubling over the next two or three years.
Investors who want explosive upside don't need to bet on science fiction valuations. Here are three stocks that have realistic paths to doubling relatively quickly.
Image source: Getty Images.
1. ADMA Biologics Unlike SpaceX, ADMA Biologics (ADMA +0.34%) is already profitable. And its earnings are growing. The company posted net income of $407 million in the first quarter, up 22% year over year.
ADMA markets three approved products, all plasma-derived immunoglobulin (IG) therapies. Asceniv is its flagship product, generating roughly 86% of total revenue. It was approved by the U.S. Food and Drug Administration (FDA) in 2019 for treating primary humoral immunodeficiency, a group of genetic disorders in which the body's immune system can't make enough antibodies, called immunoglobulins, to defend against infections.
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The consensus analysts' 12-month price target for this biotech stock is almost exactly double the current share price. Raymond James (RJF 0.01%) recently initiated coverage of ADMA Biologics with a buy recommendation and a price target that implies potential upside of around 140%.
What's behind Wall Street's optimism about ADMA? For one thing, the company has captured only around 4% of its total addressable market so far. That market is expected to grow at a compound annual rate of 10% through 2033. ADMA has also developed technology that delivers IG production yields 20% or more higher with the same quantities of plasma, which should boost both revenue and earnings.
2. EyePoint Pharmaceuticals EyePoint Pharmaceuticals (EYPT 0.36%) and SpaceX share at least two things in common. Both stocks are up around the same percentage year to date. Both companies are losing money. But EyePoint has a better excuse for its lack of profitability: it doesn't yet have an approved product.
That could change soon. EyePoint expects to report top-line results from two late-stage clinical studies evaluating Duravyu for the treatment of wet age-related macular degeneration (AMD) any day now (the company told investors the trials are "on track for data readouts beginning mid-year"). Enrollment in another Phase 3 study of the drug for the treatment of diabetic macular edema (DME) should wrap up in the third quarter of 2026.
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Wet AMD and DME represent a combined global market opportunity of over $15 billion. These markets are currently dominated by three drugs: Bayer's (BAYRY +1.06%) and Regeneron's (REGN +2.06%) Eylea, Roche's (RHHBY 0.23%) and Novartis' (NVS +0.13%) Lucentis, and Roche's Vabysmo. EyePoint's Duravyu uses a sustained-release formulation that can reduce injection frequency, making the therapy highly attractive to physicians and patients if approved.
Because of Duravyu's tremendous potential, Wall Street is overwhelmingly bullish about EyePoint. All 12 analysts surveyed by S&P Global (SPGI +3.78%) in June rated the stock as a "buy" or "strong buy." The consensus 12-month price target is 165% higher than EyePoint's current share price.
To be sure, FDA approval of Duravyu isn't a slam dunk. Neither is commercial success. However, EyePoint's prospects of doubling over the next couple of years appear much higher than SpaceX's.
3. Viking Therapeutics When most people think about investing in GLP-1 stocks, Eli Lilly (LLY +7.51%) and Novo Nordisk (NVO +1.00%) probably come to mind first. But another stock appears to be on track to give Lilly and Novo a run for their money: Viking Therapeutics (VKTX +2.79%).
Viking Therapeutics is in the same boat as EyePoint Pharmaceuticals in some respects. The company remains unprofitable because it doesn't yet have an approved drug. However, like EyePoint, Viking could have good news on the way. It's evaluating the lead obesity candidate, subcutaneous VK2735, in two Phase 3 trials. The drugmaker plans to begin another late-stage study of oral VK2735 in the fourth quarter of 2026. Both formulations of VK2735 have shown significant promise in earlier clinical trials.
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In addition, Viking's pipeline includes three other experimental therapies in clinical development. VK2809 completed a Phase 2 study targeting metabolic steatohepatitis (MASH), a fatty liver disease. VK-0214 is in early stage testing as a potential treatment for X-linked adrenoleukodystrophy, a rare genetic disease. Viking also recently initiated a Phase 1 study of VK3019 as a weight-loss treatment.
Investing in Viking Therapeutics comes with risks. However, the upside is enormous. As a case in point, the average price target for the stock is 146% higher than Viking's current share price.
June has been a history-maker for Wall Street. Not only did the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite catapult to new highs earlier this month, but investors also witnessed the largest-ever initial public offering (IPO) take shape, courtesy of Space Exploration Technologies (SpaceX)(SPCX +0.15%).
Elon Musk's artificial intelligence (AI) and space economy conglomerate debuted on June 12 and ultimately raised $85.7 billion (including the underwriters' overallotment) -- nearly triple the amount that overseas oil giant Saudi Aramco raised with its December 2019 IPO.
Image source: Getty Images.
However, the biggest fireworks for SpaceX are yet to come. Thanks to two converging events, July 7 is shaping up to be a monster day for this $2 trillion AI and space company.
Nasdaq-100 inclusion is right around the corner Before SpaceX went public, several committees amended the criteria for the inclusion of megacap stocks in major indexes.
For instance, the U.S. Russell Indexes drastically shortened the inclusion timeline for newly public large-cap stocks from once per quarter to just five trading sessions.
But the headline change came courtesy of the Nasdaq (NDAQ +1.24%) Global Indexes. Effective May 1, the low float requirement for inclusion in the Nasdaq-100 has been waived.
To be clear, this means only the S&P 500 will exclude SpaceX shortly after its IPO.
FTSE Russell adds eligible megacap IPOs after the close of the 5th trading day.
Nasdaq adds them about 15 trading days after listing.
The S&P 500 kept its rules, so SpaceX waits the full...
-- Hedgeye (@Hedgeye) June 4, 2026 More importantly, any non-financial company that would rank among the 40 largest companies in the Nasdaq-100 can be fast-tracked into the index after 15 trading days. Accounting for the Juneteenth and Independence Day holidays, July 6 marks the 15th trading day for SpaceX stock.
As early as July 7, SpaceX will be eligible for addition to the growth-stock-dominated Nasdaq-100. Index funds and growth-focused exchange-traded funds that track the Nasdaq-100 will be required to purchase shares of SpaceX stock. The company's inclusion in the Russell 1000, Russell 3000, and Nasdaq-100 should lead to tens of billions of dollars in buying demand.
Image source: Getty Images.
The participating underwriters' quiet period ends However, Nasdaq-100 inclusion eligibility isn't the only catalyst that aligns on July 7. It's also the end of the participating underwriters' quiet period.
Most IPOs have a lead underwriter and a couple of participating underwriters (usually major banks/financial institutions). SpaceX had 21 underwriters, with Goldman Sachs as the lead.
For participating (i.e., non-lead) underwriters, Securities and Exchange Commission (SEC) rules mandate a 25-calendar-day quiet period following an IPO. During this period, participating underwriters are forbidden from issuing research reports or initiating recommendations/price targets for the company they helped take public.
The SEC requires this quiet period to ensure that underwriters don't unfairly promote a company in which they may have a vested interest.
July 6 will mark the 25th calendar day since SpaceX went public (including its debut day). This means a likely onslaught of buy recommendations and lofty price targets set to be issued on SpaceX starting on July 7.
Great look at the SpaceX shares unlock schedule as well as the potential passive buying schedule from @JSeyff @FrancisSharoon Depending on the early post-IPO returns, this could really play with and disperse the returns of "passive" funds (which is why there's arguably no such... pic.twitter.com/KOuEkJlngF
-- Eric Balchunas (@EricBalchunas) May 28, 2026 While this perfect storm of positive catalysts could provide a sizable boost to SpaceX's shares next week, keep in mind that Musk's company also has an accelerated/staggered share lockup period. Insiders will have an opportunity to begin dumping their shares on retail investors as soon as the second trading day following the company's first quarterly earnings release as a public company in August.
In other words, whatever pop SpaceX enjoys on and shortly after July 7 is likely to dissipate in the weeks that follow.
The shares should be getting a boost Monday as it's set to begin trading in a major stock index for the first time, after joining the Russell 1000 after the close Friday.
Shares of rocket and satellite company SpaceX (SPCX +0.13%) have tumbled almost as fast as they climbed. After its market debut this month sent shares as high as $225.64, the stock has since fallen about 32% to about $153 as of this writing.
A pullback like this in a stock investors couldn't get enough of just weeks ago raises an obvious question: Is now the time to buy? The company behind Starlink and a leading rocket-launch business is one of the most closely watched companies anywhere. But a lower price doesn't automatically make a stock a good deal -- and in SpaceX's case, the valuation still looks stretched.
Image source: Getty Images.
Understanding the drivers behind the SpaceX business SpaceX completed its initial public offering (IPO) on June 12, pricing shares at $135 -- the biggest market debut in history. The prospectus it filed ahead of the offering gave investors their first detailed look at the financials behind the hype.
The top-line numbers are impressive. SpaceX grew revenue 33% year over year in 2025 to $18.7 billion. And most of that came from Starlink, its satellite internet business, which generated $11.4 billion in revenue (about 61% of the company total), up 48% from 2024. Starlink ended March 2026 with more than 10 million subscribers.
Even better, Starlink is profitable. The segment produced about $4.4 billion in operating profit in 2025, making it the company's profit center.
SpaceX's space segment, which includes its launch business and crew missions for NASA, added about $4 billion in revenue, though the company is spending about $3 billion to develop its next-generation Starship rocket.
This spending, combined with its aggressive outlays to support its nascent AI efforts, means SpaceX is unprofitable overall. The company reported a total net loss of $4.9 billion in 2025 on a retrospectively recast basis that includes the results of xAI, its recently absorbed artificial intelligence (AI) business. That AI segment brought in about $3.2 billion in revenue but is losing money.
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What about the stock's valuation? Even after a 32% pullback, SpaceX stock continues to look overvalued. With a market capitalization above $2 trillion, a business that loses money on the bottom line, and a price-to-sales ratio of more than 100, the bull case rests on highly speculative assumptions about the company's long-term prospects.
A valuation multiple like this prices in years of flawless execution -- not just continued rapid growth at Starlink, but a path to substantial companywide profits even as SpaceX funds Starship and absorbs xAI's losses. It assumes nearly everything goes right. Little wonder some on Wall Street think the valuation got ahead of the business. Morningstar, for one, pegs SpaceX's fair value at about $780 billion -- about half its private-market valuation -- and calls the stock significantly overvalued.
To be clear, I love the business. And I believe it will do extraordinarily well over the long haul. SpaceX has a dominant launch franchise and, in Starlink, a fast-growing, high-margin asset few companies can match. The problem is what you pay for it. It's nearly impossible to justify a price anywhere close to where the stock trades today.
That said, I wouldn't be surprised to see shares keep trading on sentiment rather than fundamentals. SpaceX has a huge retail following and a founder, Elon Musk, who commands enormous attention -- and stocks like that can stay expensive far longer than the numbers alone would suggest. So while the shares could certainly move higher from here, the math doesn't work for me, and I can't base an investment case on unpredictable sentiment. I'll personally be watching from the sidelines.
There's no shortage of excitement about the revenue potential for Space Exploration Technologies (SPCX +0.15%), better known as SpaceX. Some analysts see it reaching trillions of dollars in annual sales across its launch services, connectivity business, and artificial intelligence segment.
That said, nobody expects it to be a straight line up and to the right. In fact, SpaceX could see a major revenue inflection this year thanks to a huge pivot in its AI segment.
The shift speaks volumes about the current state of the business and its potential going forward. And while the market is cheering some of the headline numbers, it may be underappreciating the implications for the company's finances and the stock's performance.
Image source: The Motley Fool.
The biggest revenue growth driver at SpaceX Over the last few weeks, SpaceX has signed several deals to provide compute to other AI companies:
Anthropic will pay $1.25 billion per month to use the entirety of its Colossus 1 data center. Alphabet will pay $920 million per month to use about half as many processors as Anthropic. Reflection AI, a start-up focused on building an open-source frontier model, is paying $150 million per month for additional compute capacity from SpaceX. Those three contracts add up to nearly $28 billion in annual revenue, and SpaceX could look to make even more deals. "We have sufficient capacity to provide compute for our own AI models, including support of our training and inference demands, and to satisfy the obligations under these agreements," management wrote in its IPO registration filing with the SEC.
The shift is clear: The growth in SpaceX's AI revenue will stem from selling infrastructure rather than its own AI services. In effect, SpaceX is becoming another infrastructure-as-a-service business, or "neocloud," selling relatively undifferentiated compute capacity to leading AI labs that need as much as possible. Meanwhile, its own AI model is seeing so little use that it has hundreds of thousands of GPUs sitting idle in its data centers.
That shift will provide a significant boost to revenue right now, but investors need to consider how valuable that revenue and line of business are for SpaceX.
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Does SpaceX have a competitive advantage? The biggest concern for operating a neocloud company is establishing a competitive advantage. For the most part, the end product is undifferentiated. A token is a token. So, the only way to compete effectively is to keep your costs lower than everyone else.
To that end, SpaceX believes it has an advantage. "Our first-principles thinking enables us to build coherent compute at scale and at rapid speed with lower costs than most other companies in the industry," management wrote in its S-1 filing. However, SpaceX's strategy of retrofitting old factories near efficient water sources won't scale. There are only so many prime locations to construct data centers.
SpaceX may be able to find a sustainable cost advantage with orbital data centers. The cost will depend heavily on its ability to bring launch costs down by developing its fully reusable heavy-lift rocket, Starship. Management says it could launch its first orbital data centers by 2028.
What does it all mean for SpaceX stock? The move to monetize its limited compute capacity by renting it out instead of using it for its own AI development is telling. Management expects its large language model Grok to remain a niche player among large language models. That severely limits its profit potential. With the majority of SpaceX's revenue growth stemming from its pivot toward becoming a neocloud operator, investors may want to reassess the value of that revenue growth.
Leading neocloud providers CoreWeave and Oracle have massive backlogs of compute contracts.
CoreWeave has contracted revenue of nearly $100 billion as of the end of the first quarter, with $36 billion of that to be recognized over the next two years. The total backlog is larger than SpaceX's, but its annual run rate is smaller. For reference, CoreWeave's market cap sits around $55 billion.
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Oracle's remaining performance obligations total a whopping $638 billion as of the end of its most recent quarter. It's adding tens of billions of dollars in contracts every quarter. Approximately $75 billion of that backlog will be recognized over the next 12 months, and over $200 billion will hit Oracle's top line in the subsequent two years.
CoreWeave's and Oracle's strong revenue growth suggest SpaceX could achieve similar results over the coming years. However, that revenue isn't worth nearly as much as the revenue that comes from selling AI software services themselves.
That's evidenced by the price-to-sales multiples assigned to CoreWeave and Oracle: 4.2 and 5, respectively. By comparison, SpaceX trades at well over 100 times trailing 12-month sales. Even if it triples its sales over the next year thanks to infrastructure contracts, its sales multiple still sits well above reasonable levels.
In the early days of online shopping, Amazon (AMZN +2.44%) was a simple website that sold books. In the years that followed, the company expanded its marketplace into a more comprehensive e-commerce platform. That eventually helped pave the way for the launch of its cloud infrastructure platform, Amazon Web Services (AWS). This chain of events quietly turned Amazon into an essential digital infrastructure provider -- driving trillions of dollars in market value.
Elon Musk's Space Exploration Technologies (SPCX +0.13%) is following a similar path. While SpaceX began with rockets that made it cheaper to get payloads into orbit, the company now also offers global internet connectivity through its Starlink business and is building large artificial intelligence (AI) data centers.
SpaceX's long-term goal is to create a comprehensive suite of tools that power the entire AI economy. Recent steps, including its merger with xAI and its acquisition of Cursor AI, are speeding this process up.
Image source: The Motley Fool.
Rockets, internet, and AI infrastructure all under one roof SpaceX oversees the complete sequence required to deliver all aspects of the AI infrastructure value chain. The company's rockets handle the launches that place equipment into orbit. Starlink's broadband satellites provide a global connectivity network that can link AI systems with end users. And on the ground, SpaceX is deploying large clusters of servers dedicated to training AI models.
This vertical integration extends to power and data flow, too. Terrestrial data centers draw electricity from the established grid and power plant infrastructure, and supplement that with on-site power generation where needed. The data center satellites it aims to deploy in orbit will operate using continuously available solar power.
Since SpaceX controls rockets, the connectivity layer, the power approach, and the accelerated computing hardware, it will be able to develop and deploy next-generation AI systems without depending on external suppliers for each step. This playbook mirrors the one used by Amazon, which built its own warehouses, logistics network, and cloud platform rather than relying on outside vendors for those key pieces of its operation.
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SpaceX is bolstering its AI business through key combinations Prior to its initial public offering, SpaceX acquired xAI to bring advanced model development inside the organization. In essence, that deal allows SpaceX's engineers to design AI systems while simultaneously building the physical infrastructure that will run them. The result is a closed-loop system between the software and the hardware that supports AI development.
The company's recent $60 billion acquisition of Cursor further supports this effort. Cursor provides tools that help developers create and refine the software needed for designing advanced computing systems.
The key takeaway here is that SpaceX is not stopping at reusable rockets or satellite broadband. CEO Musk is aggressively assembling a portfolio of end-to-end capabilities that AI hyperscalers will need in the future. Against this backdrop, SpaceX is positioning itself to be a core infrastructure provider in the same way that AWS became one of the key supporters of enterprises' digital transformations.
SpaceX's long-term ambitions go beyond Earth There are a host of constraints to building AI data centers on Earth. Such facilities consume massive amounts of electricity, straining local power grids and raising energy costs for everyone around them. They occupy large amounts of land, and also require extensive cooling systems that, in a majority of cases, suck up huge volumes of fresh water. All of those resources are becoming more expensive to secure, particularly given big tech's willingness to lay out hundreds of billions of dollars in capital expenditures to build out AI infrastructure.
AMZN Capital Expenditures (TTM) data by YCharts.
SpaceX is seeking to remove some of these bottlenecks by deploying a constellation of orbital AI servers. In certain orbits, intense solar power is available 24 hours a day to be converted into electricity. Moreover, these satellite-based computer servers can be cooled by using large radiator panels to emit the heat they generate as infrared radiation into the vacuum of space.
In theory, the payload capacity of SpaceX's Starship rocket will make it feasible to launch large-scale computing modules rather than individual parts -- allowing more efficient construction of these installations. The company can then use its Starlink infrastructure to maintain those data center satellites' connectivity to Earth. Such an orbital ecosystem would open a path for AI computing capacity to continue growing without facing the same resource constraints that hinder its ground-based expansion.
SpaceX combines a proven ability to maintain a rapid rocket launch cadence, a global satellite connectivity service, and a credible approach to building AI compute beyond Earth's limits. The company's ambitious long-term plan for infrastructure leadership echoes the narrative of Amazon's foray into cloud services, with clear implications for sustained growth and strategic importance in the AI economy if Musk and his companies can execute on his vision.
In 1873, Jules Verne's novel Around the World in 80 Days became his first international success. The seemingly impossible prospect of circumnavigating the entire world in so short a timespan captured the global imagination.
That's because only a few years prior, it was impossible. It was only doable thanks to three engineering feats: the completion of the Suez Canal and the U.S. transcontinental railroad in 1869, and the linking of the Indian railways in 1870.
Now Elon Musk is proposing a new engineering feat that we might call Around the World in 80 Minutes. Is it a game changer for his Space Exploration Technologies (SPCX +0.13%), or SpaceX?
Here's the sounds-like-something-out-of-a-sci-fi-novel idea behind the "Starfall" project, and whether it bolsters the bull case for SpaceX.
Image source: Getty Images.
Faster than a speeding bullet Everything's faster in space.
That's the big idea behind Starfall. Traditional airplanes can travel at a poky 575 mph, and the now-retired Concorde supersonic jet had a cruising speed of 1,350 mph. The Earth's atmosphere and those pesky laws of physics prevent pretty much anything besides a missile from going much faster than that.
But in near-Earth orbit, satellites like the International Space Station travel at about 17,500 mph (5 miles per second). At that velocity, they make a complete orbit of the Earth in about 90 minutes. So if you wanted to deliver something to the opposite side of the globe as quickly as possible, you could launch it into space and then drop it out of orbit just 45 minutes later. That would deliver the payload well before any traditional delivery method (even the Concorde would take more than 9 hours).
But... can SpaceX actually pull this off? A new test suggests it can.
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Stronger than a locomotive Starfall was developed under a veil of secrecy, but we have a publicly available FAA environmental assessment that tells us a little bit about the program. It says that Starfall will "enable point-to-point delivery of critical cargo through space on rapid timelines." The FAA approved the program for testing, and the first test occurred on Tuesday.
One of SpaceX's Falcon Heavy rockets carried a Starfall reentry pod into near-Earth orbit. The rocket then separated, at which point the upper stage was scheduled to carry the pod in orbit around the Earth twice, then guide it back into the atmosphere, where it would achieve a parachute-assisted splashdown in the Pacific Ocean. I say "was scheduled to" because while SpaceX has confirmed the successful launch, separation, and return of the Stage 1 Falcon Heavy rocket, it hasn't provided details about the upper-stage rocket's flight or its payload.
All we know is that the Starfall pod weighs about 4,600 pounds, with a 2,200-pound payload capacity, and looks like a cylindrical disc about 10 feet in diameter and 2.5 feet tall.
Able to leap tall valuations in a single bound We don't know whether the recent Starfall test was successful, so it's impossible to know for certain how close this technology is to becoming a reality. But one thing's for sure: It won't be used for getting that inexpensive Temu dress to your doorstep in time for your hot date tonight. At least, not at first.
For one thing, Starfall capsules can't apparently take themselves out of orbit, but are reliant on their launch vehicle to place them on a trajectory for reentry. Until SpaceX's fully reusable Starship vehicle comes online, that means burning an expensive upper-stage rocket with every Starfall capsule delivery.
Image source: Getty Images.
But if SpaceX's reusable Starship comes online in its current form, it will only have a few possible landing sites due to its size. Starfall capsules could offer the flexibility to deliver payloads to far-flung locations where Starships can't land. The U.S. military could certainly use technology that could deploy a one-ton payload anywhere in the world in 80 minutes from a reusable launch vehicle, even if the initial cost is high.
Launch costs in general are expected to continue dropping sharply as SpaceX improves its technology and introduces the fully reusable Starship. So it's possible that Starfall could someday power consumer deliveries. But that won't happen in the next 80 days ... or even the next 80 weeks.
Ultimately, while Starfall could someday generate a valuable revenue stream for SpaceX, investors shouldn't try to factor it into their analysis just yet. Instead, we should at least wait for confirmed details before updating our SpaceX valuation.
Space Exploration Technologies Corp (SPCX +0.13%) raised $75 billion in its initial public offering (IPO) on June 12. When you add in the overallotment given to the investment banks that helped with the IPO, that figure rises to $85.7 billion. Just days after the IPO, the company announced it would sell $20 billion in bonds, even though it already had $100 billion in cash on its balance sheet. It actually raised $25 billion from the bond sale, thanks to strong demand. Here's why all that cash won't last very long.
SpaceX is big, but it's still a start-up The hype around SpaceX is huge, partly because of Elon Musk's involvement and partly because the company has achieved impressive milestones. In fact, the company's Starlink cellular telecommunications business is profitable. The problem is that its rocket business and its artificial intelligence operations (AI) are not. So the company, overall, doesn't turn a profit, a fact clearly disclosed in the IPO prospectus.
Image source: Getty Images.
Also clearly disclosed was the need for huge ongoing capital investments. That's not something to overlook just because the company has $100 billion in cash and just sold $25 billion in bonds. For starters, the bond sale proceeds were earmarked to repay bridge loans. While there may be some cash left over, it likely won't be much.
The $100 billion in cash on the balance sheet, meanwhile, must be compared with the company's investment needs. It is very clear in its prospectus that capital spending will be a massive cash drain. In the first quarter of 2026, SpaceX made capital investments totaling $10.1 billion, up from $4.1 billion in the prior year.
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If you annualize that, and generously assume that capital spending needs don't increase further, the company is on pace to spend around $40 billion a year. So $100 billion is enough to cover two and a half years' worth of capital spending needs if capital spending doesn't increase further. Given the huge amount of money being spent in the AI arms race, it seems likely that capital investment spending could rise from here.
SpaceX is likely to be tapping the capital markets again Elon Musk has huge goals for SpaceX. While the cash raised so far seems like a massive sum, it likely won't last long. Look for the company to come back to the capital markets for more cash, a move that could dilute current shareholders. And that doesn't even take into account the overhang from the stock that is likely to hit the market when the lockup period from the IPO ends and insiders start selling shares. All in, there could be more downward pressure on the stock than many investors realize, increasing the importance of taking a long-term view if you own SpaceX or are considering buying it.
Space Exploration Technologies (SPCX +0.15%), or SpaceX, became the largest company ever to undertake an initial public offering (IPO) earlier this month, and the stock had a strong start out of the gate. It rose three straight days after debuting, hitting a high of $225.64. However, the stock has since pulled back to levels at which it traded on its first day, and I would be wary of buying it here.
Historically, it is very common for stocks to eventually trade below their opening-day low. According to The Lifecycle Trade, this happens about 90% of the time. In fact, SpaceX traded below its day-one low price for the first time on June 23, only six trading days after its debut.
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This is notable since the stock currently has a very low initial float of just 4%, and there should have been some initial institutional buying to support it. Now it faces a series of share lock-up expirations that will increase its float over the next year, which could pressure its shares. The company has an astonishing 15 lockup expirations over the next year-plus.
The first lock-up expirations are scheduled for the next two months. The first could come two days after its first earnings release, which Morningstar currently estimates will take place in late July or early August. Insiders will then be able to sell 911.5 million shares, or nearly 7% of its original shares outstanding, if they wish. Another 319 million shares, or about 2.4% of its original shares outstanding, will be released on Aug. 20.
Image source: The Motley Fool.
The long view Setting aside near-term trading dynamics, what about SpaceX's long-term prospects? The company has painted a very bright picture of its future, where not only will it have leading connectivity (satellite internet and mobile) and rocket-launching businesses, but it will also be operating AI data centers in space. It also plans to build a large chip manufacturing facility with Tesla and Intel.
With the company producing just under $19 billion in revenue last year and carrying a $2 trillion market capitalization, investors are betting very heavily that some of SpaceX's moonshot bets pay off. Its reusable rocket business gives it a cost advantage, and its Starlink satellite internet business is nice, but this is a capital expenditure-heavy business that will be solid but not worth getting overly excited about. Meanwhile, Nvidia's CEO was very skeptical of SpaceX's Terafab initiative.
Between its near-term trading dynamics, high valuation, and heavy emphasis on things that may or may not happen in the future, this is an AI stock I'd avoid.
Geoffrey Seiler has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Intel, Nvidia, and Tesla. The Motley Fool has a disclosure policy.
SpaceX (NASDAQ: SPCX) insiders have sold approximately $1.2 million worth of the stock over the past year, according to insider trading data.
Data covering the period between June 28, 2025, and June 27, 2026, shows a single insider sale by SpaceX Chief Executive Officer Elon Musk.
The transaction involved the sale of 11,390 shares on April 2, 2026, at an average price of $105.32 per share, for a total value of $1,199,594.80.
SpaceX insider trades. Source: Market Beat The sale is notable because it occurred before SpaceX’s blockbuster June 2026 initial public offering, which priced shares at $135 each before the stock surged during its debut trading sessions.
Minimal SpaceX insider trades Available records indicate that Musk was the only SpaceX insider to sell stock during the last 12 months. No insider purchases or additional sales were disclosed during the period.
Notably, the sale price of $105.32 per share was below both the IPO price and current market levels, suggesting the transaction was completed before investors fully priced in SpaceX’s public-market valuation.
SpaceX insider selling often attracts investor attention because company executives have direct insight into business performance. However, a single insider transaction does not necessarily signal weakening confidence in the company.
In SpaceX’s case, the reported sale appears relatively small compared to the company’s roughly $2 trillion market capitalization and does not indicate broader insider liquidation. The absence of multiple insider sales reduces concerns that executives are rushing to exit positions following the company’s public debut.
As a result, the disclosed transaction is unlikely to have a material impact on SPCX stock on its own. Investors typically become more cautious when several executives sell large portions of their holdings over a short period, a trend that has not emerged in recent SPCX insider trading activity.
SpaceX stock volatility As of press time, SPCX was trading at approximately $153 per share, remaining above its IPO price despite retreating from post-listing highs above $225.
SpaceX’s one-week stock price chart. Source: Finbold The stock initially surged on strong retail and institutional demand, pushing SpaceX’s valuation above $2 trillion.
Since then, shares have experienced increased volatility as investors reassessed the company’s premium valuation, ongoing losses, and significant capital expenditure requirements.
While the insider sale may draw attention, the near-term direction of SPCX stock is likely to be driven by Starlink subscriber growth, launch activity, profitability trends, AI-related investments, and broader market sentiment toward high-growth technology companies rather than a single $1.2 million insider transaction.
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On Tuesday, June 23, a SpaceX Falcon 9 lifted off from Cape Canaveral carrying a vehicle most people had never heard of. The payload was called Starfall -- a disc-shaped reentry pod, 10.2 feet wide and 2.5 feet tall, designed to carry up to 1 metric ton of cargo from low-Earth orbit back to Earth's surface.
Space Exploration Technologies (SPCX +0.13%) described it publicly as a "microgravity lab" for scientific research and in-space manufacturing. What the Federal Aviation Administration's environmental assessment called it was more specific: a vehicle to "enable point-to-point delivery of critical cargo through space on rapid timelines."
Image source: Getty Images.
Those two descriptions are both accurate, and the gap between them is where the investor story lives.
The vehicle is not capable of de-orbiting itself. It relies on its launch vehicle -- a Falcon 9 today, potentially Starship later -- to guide it back toward the atmosphere, after which it orients its heat shield using compressed nitrogen gas and descends by parachute to a splashdown zone. It's smaller than SpaceX's Crew Dragon, built exclusively for cargo, and recoverable -- SpaceX intends to retrieve the vehicle and its parachutes for reuse.
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Two markets to pay attention to Two markets emerge immediately from that design profile. The first is military logistics. The Pentagon has been working toward a space-based point-to-point cargo delivery capability for years. In 2022, the Air Force Research Laboratory awarded SpaceX a $102 million contract to demonstrate the concept using Starship -- the ability to deliver roughly a C-17 Globemaster's worth of supplies anywhere on the planet in under 90 minutes. Starfall, smaller and deployable on the existing Falcon 9, is a complementary tool for lighter, more targeted deliveries that don't require Starship's enormous footprint or a prepared landing site. The Pentagon has signed similar early-stage agreements with Rocket Lab (RKLB +4.67%), Blue Origin, and Anduril for reentry vehicle development. SpaceX is the only company flying a working vehicle today.
The second market is commercial in-space manufacturing, and it's further along than most people realize. Varda Space Industries signed a partnership with United Therapeutics in May 2026 to manufacture drugs in microgravity -- specifically targeting small-molecule crystallization processes that Earth's gravity renders structurally imperfect. Varda CEO Will Bruey put the economics plainly at the 2026 Upfront Summit: A launch capable of processing space-manufactured drugs and returning them to Earth now costs roughly $2.2 million -- a number that makes pharmaceutical microgravity viable at commercial scale for the first time. Starfall, with its 1-metric-ton payload capacity and reusable design, is positioned as the return infrastructure that makes that supply chain possible at volume.
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This is where SpaceX's structural advantage over every competitor in this space becomes relevant to investors. Rocket Lab is targeting a 2026 demonstration of reentry capability on its Neutron rocket -- which has not yet flown. Blue Origin is earlier in the development process. Inversion Space received a $71 million contract for its Arc reentry vehicle, which remains in development. SpaceX flew Starfall on Tuesday. That lead time matters in a market where government procurement decisions follow demonstrated capability, not road maps.
The military's REGAL program -- Rocket Experimentation for Global Agile Logistics -- has explicitly framed point-to-point space cargo as a pathway to becoming a program of record, meaning recurring annual defense budget line items rather than one-time research and development (R&D) grants. SpaceX's $102 million AFRL contract was the first significant step in that direction. Starfall's successful demonstration puts the company in a position to substantially expand that relationship.
What this means for SPCX shareholders -- or those interested in investing Here is where the honest qualification belongs. Starfall's commercial potential is real, but the timelines are long, and the revenue is not yet material on SpaceX's financials. The company's near-term revenue story is Starlink, which generated $4.42 billion in operating income in 2025 and remains the only profitable segment. Even in an optimistic scenario where it wins military contracts and becomes the backbone of orbital pharmaceutical manufacturing, Starfall adds revenue on a multiyear timeline.
For investors looking at SpaceX in a week when the stock has already fallen nearly 30% from its peak due to valuation and float concerns, Starfall is the kind of development that validates the long-term thesis without changing the short-term math.
It is also worth saying plainly: None of this is new. SpaceX has been demonstrating breakthrough capability for years, and investors who needed Tuesday's test to feel confident in the underlying technology were perhaps not paying close enough attention. SpaceX is building real technology that solves real problems.
The question that was true before Tuesday and remains true after it is whether the current price -- which sits 53% above Morningstar's base-case intrinsic value -- gives investors enough room for execution risk on programs that haven't yet generated meaningful revenue.
The technology is not what's in question. The valuation still is.
Space Exploration Technologies (SPCX +0.15%), or SpaceX, has become a tempting addition to one's portfolio. Under the leadership of Elon Musk, Starlink has become a tremendous success, dominating private launches into space and becoming a key contractor for NASA.
Despite such attributes, consumer stock investors have numerous successful stocks in this sector to choose from. Knowing this, should they add to their SpaceX positions or stick with consumer discretionary stocks?
Image source: Getty Images.
Consumer stock growth Even before SpaceX launched its IPO, investors had many solid consumer stocks to choose from, and many of these are among the most successful stocks in history.
As with SpaceX, the success stories in the consumer sector were those that fundamentally changed an industry. Perhaps the most prominent standout is Amazon, which has risen by almost 242,000% since its IPO in 1997. Amazon succeeded by pioneering e-commerce and, later, cloud computing.
This is also true of Netflix, which is up by around 61,000% since its 2004 IPO. The company single-handedly ended the video rental industry and inspired cord-cutting as consumers traded cable TV subscriptions for streaming services.
In some cases, the growth occurred without direct involvement of the technology industry. TJX Companies is up 45,000% since 1990. Also, multinational retail giants like Walmart and Home Depot drove massive growth by launching IPOs early in their histories.
Admittedly, many of those stocks are outliers in terms of performance. Nonetheless, new companies (besides SpaceX) continue to emerge and grow to the point that they launch IPOs of their own. Knowing that, the consumer success stories should continue.
Putting SpaceX into perspective Despite tumbling over the last week, SpaceX stock continues to trade above its $135-per-share IPO price. SpaceX has also benefited from revenue projections, such as one Goldman Sachs forecast of a 100-fold revenue gain by 2030.
However, Goldman's projection is not a guarantee, and the premium investors have to pay for such growth is likely to deter some investors, especially with its 110 price-to-sales (P/S) ratio. In comparison, the average sales multiple for the S&P 500 (^GSPC 0.05%) is around 3.6, and even a highflier like Micron currently sells at just 20 times sales.
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Moreover, many of the aforementioned stocks launched their IPOs early in their histories, most often when their market caps were below $1 billion. That early start is what made their massive growth over time possible.
Unfortunately, this is not the case with SpaceX. SpaceX's market cap is already above $2.1 trillion, making it less likely that SpaceX will make you a millionaire.
Currently, after Amazon's aforementioned 242,000% gain, its market cap is around $2.5 trillion, just 18% higher than SpaceX's.
Furthermore, even after 61,000% gains, Netflix's market cap is $308 billion, roughly one-seventh of SpaceX's. TJX is about one-twelfth the size of SpaceX. Amid such gains, investors may question whether buying SpaceX is a prudent choice when compared with consumer stocks.
Should you invest in SpaceX or other consumer stocks? Given the performances of many consumer stocks, investors are likely best off choosing consumer stocks over SpaceX.
SpaceX has shown many of the characteristics that made some of the more prominent consumer stocks successful. Under Musk's leadership, it appears poised for rapid growth.
Unfortunately, its first $2 trillion in growth occurred before the stock went public, robbing investors of the chance to buy SpaceX early and earn outsize gains comparable to those of early Amazon, Netflix, or TJX investors.
Although investors have to rely on future growth to earn returns, the 110 P/S ratio has priced much of that growth into the stock. That probably means SpaceX investors will lose out as multiples compress. Worse, even if the sales multiples fall to where Micron trades in the low 20s, current investors could be left holding the bag as the stock takes a hit.
Thus, even if investors choose slower-growing consumer stocks over SpaceX, the consumer stocks are almost certainly safer and could ultimately yield higher returns over time.
For the first time, anyone who owns an index fund is about to own a piece of SpaceX (SPCX +0.15%). The rocket and satellite company went public on June 12 in the largest initial public offering (IPO) in history, and barely two weeks later it is being pulled into the funds that sit inside millions of 401(k)s and brokerage accounts.
On Friday, SpaceX was added to the Russell 1000 under a new rule that fast-tracks the biggest new listings into the index. And before the market opens on July 7, it will join the Nasdaq-100 through a similar process. Likely millions of people who have never placed a direct order for the stock are about to pick up a sliver (albeit indirectly) through funds they already hold.
Fortunately, the buying comes as the shares have cooled. SpaceX trades at about $153 as of this writing, down about a third from the post-IPO high of about $226 it reached on June 16.
Image source: Getty Images.
Why the funds have to buy When a company enters an index, every fund built to track that index has to buy the stock -- regardless of the price, the valuation, or whether the business turns a profit. The buying is automatic, and for a company SpaceX's size, it is large.
Estimates vary, but the sums are big. The Russell 1000 move alone could force over $4 billion of buying, by some estimates, and the Nasdaq-100 addition is expected to drive about $4 billion more as well. Add in the other funds that track related benchmarks, and the total climbs higher still.
These additions are happening fast because the index providers changed their rules. FTSE Russell, which runs the Russell indexes, now lets the largest new stocks in after just five trading days rather than waiting for its next scheduled reconstitution. Nasdaq adopted its own fast-entry route this year, clearing the way for some big new listings after 15 trading days.
None of that buying reflects a view on whether SpaceX is a good investment. Index funds don't analyze stocks the way an investor would, weighing growth, profits, and valuation. They buy because the rules tell them to.
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What the buying doesn't tell you You can see that distinction in the one major index sitting this out: the S&P 500, the benchmark most retirement dollars actually follow.
S&P Global's S&P Dow Jones Indices declined to loosen its standards for SpaceX and kept its profitability screen in place. To qualify, a company needs four straight quarters of positive earnings under generally accepted accounting principles (GAAP) -- and SpaceX doesn't meet the test. It lost about $4.9 billion in 2025 and posted another loss in the first quarter of 2026.
So the index designed to screen for steady profits is keeping SpaceX out, while the rules that ignore profits are forcing funds to buy.
Underneath, the company leans primarily on one segment in terms of its profit drivers today: Starlink, its satellite-internet service, generated about $11.4 billion in revenue in 2025 -- around 61% of the company total -- and grew close to 50% from a year earlier. The launch business, by comparison, is smaller and grew about 8%. All told, SpaceX brought in about $18.7 billion in 2025.
SpaceX makes money providing Starlink service but lost money overall, weighed down by spending on its Starship rocket and the absorption of Elon Musk's AI start-up, xAI, which it folded in earlier this year.
The valuation leaves little doubt about how much optimism is already built in. At a market capitalization of about $2 trillion, SpaceX trades at more than 100 times its annual revenue. And with no profit, there is no price-to-earnings ratio to anchor it.
The forced index buying doesn't change any of that.
So, for many investors who own the Russell 1000 or the Nasdaq-100, get used to being a SpaceX shareholder -- whether you wanted it or not. But note that being added to an index is not the same as being worth owning. Whether SpaceX deserves more than the sliver the index hands you comes down to Starlink's growth and the company's path to profits -- not which index it just joined.
Not everyone is buying Elon Musk’s vision for orbital data centers.
Masayoshi Son, the founder and CEO of Softbank, argued at a recent shareholder meeting that building data centers in space won’t do much to cut costs and will take too long when “in the battle for AI, the next few years will be far more important than what might happen a decade or so from now.”
On the latest episode of TechCrunch’s Equity podcast, Kirsten Korosec, Sean O’Kane, and I discussed Son’s remarks as part of a broader discussion that included OpenAI’s plans for custom chips, chipmaker Groq’s new $650 million funding, and much more.
Kirsten noted that it’s “very ironic” that Son is playing the skeptic here, given SoftBank’s “long history of wild bets.”
Sean, meanwhile, said that when Musk talks about “making a constellation of satellites — satellites that need to be replaced every few years as well — to make up an ‘orbital data center,’” he’s just “guaranteeing that much more business” for SpaceX.
Keep reading for a preview of our conversation, edited for length and clarity.
Sean O’Kane: Listen, neo-clouds are the new oil, and everybody who wants to make money is pivoting to a neo-cloud. I’m proud to announce that TechCrunch is now a neo-cloud, give us all your money.
I mean, this is the thing you do. It seems like there are so many players that are compute constrained, so anybody who has a shot at being able to lease out that compute is taking it, whether that’s Groq, a company that was semi-hollowed out by Nvidia, or Allbirds, which went into bankruptcy and and emerged from it as a new neo-cloud provider instead of selling shoes — Tim Fernholz did an interview with the new CEO of of that new effort that I would definitely recommend people go read.
Or whether you’re SpaceX, where your idea was: I’m gonna build an AI platform that’s gonna have an addressable market the size of U.S. GDP, but before we get there, we’ll just rent out our compute. And we saw this continue to happen with SpaceX, where it’s not as big as the deals that they’ve struck with Google or Anthropic, but they just signed another deal, [their] first post IPO deal, to rent out compute to another smaller player. They’re continuing down that road.
You know, I can see this being a business for Groq in the near term. The question with all of these is how durable is it in the long term.
Anthony Ha: If we’re talking about SpaceX and their AI business and data center business, we also have to talk about these comments that Masayoshi Son, the CEO of SoftBank, made recently, where he basically said: What is the point of data centers in space? Which is a question we’ve asked on this show.
And it speaks to, again, this sense in the industry of being really, really compute constrained — they need to build as many data centers as possible, [and] there’s all kinds of reasons why that is proving to be challenging here on Earth, so maybe space is the answer. But I think Son makes some pretty fair points about: All this stuff we’re talking about, even if it all works — and the costs are going to be very, very serious to make it work — this is not happening for years and years and years, so this is not a solution to any immediate problem, as far the current need for data centers goes.
Kirsten Korosec: I just want to point out that SoftBank has a long history of making wild bets. I think it says something when Son comes up and asks the question that a lot of people have asked.
I mean, there are a lot of VCs and founders [who] have been swept up into the idea of orbital data centers and it seems like suddenly everyone’s on board. When just a couple of years ago, I think, if someone had mentioned that, it would get slapped down a little bit. So I do think it’s an important part of the process that someone who has a pretty high profile is asking that question. But it is very ironic to me that he is the one asking it, because if you look at his pitch deck, they’ve thrown a lot of money at some pretty bold ideas.
Sean: WeWork! Listen, we’re going to be saying this for a lot over the next couple years. The idea of putting these things in space is going to be an interesting engineering challenge and certainly an interesting economic challenge.
Anthony, what you said is definitely right to a certain extent. Elon Musk is a person who hates red tape and you know, there are no NIMBYs in space so of course he’s going to try and do that.
To me, it comes down to: The business as it stands now for SpaceX, especially its launch business, is just overwhelmingly reliant on Starlink. The reason that they are 80 or 90% of the launch market globally is not just because they’ve done all these things that are better than pretty much every other launch provider around the globe, it’s also because they have Starlink that is driving up that number. If you remove Starlink from the equation, they would be closer to — I don’t know, maybe 20% or 30% of the launch market, or 40%, but it certainly wouldn’t be 90%.
And when you talk about making a constellation of satellites — satellites that need to be replaced every few years as well — to make up an “orbital data center,” quote unquote, you’re just guaranteeing that much more business for your launch business. And I just can’t stop myself from coming back to that point.
Kirsten: I want to really quickly say that [SpaceX’s] other big business is renting out their compute, by the way. So back to the chip conversation. We’ve come full circle.
Anthony: One of the other themes that may run through this episode is this idea of talking your own book. This is not a new phenomenon. Executives at tech companies, or any other company, what they’re predicting for the future is ultimately the future that is going to be advantageous to their business.
But I think it’s something that’s just always worth remembering when we’re having these conversations about big AI companies, because it is this moment of incredible uncertainty, and we’re all wondering: What does the job market look like in the future? What effect is this going to have on the environment? What are the skills I need to learn?
All these AI CEOs or AI investors, they all have thoughts on that. And it’s not that they’re wrong or that they are being deliberately misleading, but in each case, there’s an asterisk to these predictions. In Musk’s case, he’s talking about something that would be very good for SpaceX’s business. In SoftBank’s case, they are very, very heavily invested in data center projects here on Earth. Sam Altman is the other notable figure who’s rolled his eyes a bit at the orbital data center idea — and again, he and Elon Musk obviously have a long and complicated history together.
All of which is to say that there’s just no objective, impartial observers here. It’s all these people with baggage and tremendous amounts of money at stake.
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Space Exploration Technologies's (SPCX +0.15%) Starlink internet service is perhaps its most successful venture to date. This business unit accounted for the majority of SpaceX's revenues and profits last year.
The FCC has already approved the company to launch 12,000 low Earth orbit satellites. SpaceX has filed to launch 42,000 more. Future approvals will be needed, considering that more than 9,000 Starlink satellites are already in orbit.
Just how fast will SpaceX launch additional satellites? One major upcoming catalyst will determine the pace of launches.
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This is how many satellites SpaceX will launch in 2026 SpaceX continues to launch more Starlink satellites regularly. On June 20, the company launched 24 more satellites on a Falcon 9 rocket from Vandenberg Space Force Base in California. Four days later, it launched another 24 satellites.
Halfway through 2026, SpaceX has already launched more than 1,500 satellites. In total, SpaceX has launched more satellites into space than any other company in history.
Image source: Getty Images.
At this pace, SpaceX should deploy roughly 3,000 satellites into space this year, perhaps more if the company's IPO funding helps accelerate launch cadence.
The biggest catalyst for growth, however, will be the company's Starship megarocket. A single Starship can launch the equivalent of roughly 600 v2 Starlink satellites -- more than 20 times what Falcon 9 rockets can manage.
SpaceX's Starship megarocket has completed several key testing phases. But some experts don't expect it to be commercialized until 2027. When Starship launches, it will scale; however, SpaceX will deploy a huge number of additional satellites -- many times more than in its previous launches.
Ryan Vanzo has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
With its historic IPO in the rearview mirror, Space Exploration Technologies (SPCX +0.13%), or SpaceX, turned its attention from rockets and mass drivers to coding tools. Last week, the company announced it will move forward with the $60 billion acquisition of Cursor, which is expected to close in the third quarter.
Cursor is the developer of a popular AI-powered code editor that has seen rapid adoption within the software development community, recently reaching $4 billion in annual recurring revenue. While the revenue is noteworthy, the strategic value to SpaceX goes beyond a new income stream.
Image source: Getty Images.
Closing the loop on compute The most valuable asset SpaceX is acquiring may not be Cursor's coding tools but the data they generate. Cursor brings a large user base of over 50,000 businesses, including nearly two-thirds of the Fortune 500.
Cursor's code editor is deeply integrated into developer workflows, generating data that few other companies can access. The platform doesn't just see the prompts developers use; it also tracks whether they accept, edit, or discard the AI-generated code.
This feedback provides a rich source of data for training and refining agentic models. Through this lens, the acquisition can be viewed as a strategic move to secure proprietary coding data that AI model makers are racing to collect.
This provides SpaceX a firmer footing in the enterprise market, where xAI's Grok Build has struggled to capture market share. In return, the Cursor team gets access to SpaceX's infrastructure and compute power, which has been a critical constraint for its model training.
Building a vertically integrated AI stack The day the deal was made official, Cursor also announced a new 1.5 trillion-parameter Composer coding model, trained from scratch on SpaceX's infrastructure. The model will ship in the coming weeks as part of Cursor and Grok Build, SpaceX's own coding agent. The company also announced plans to launch Origin, a code-hosting platform aimed at taking market share from Microsoft's GitHub.
You can see how this deal aligns with CEO Elon Musk's mission to build a vertically integrated AI stack, from the data center to the application layer. This allows SpaceX to capture more value from its infrastructure investments than simply being a landlord.
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The acquisition carries execution risk, as SpaceX integrates a fast-growing software company into its hardware-centric culture. The initial test is scheduled weeks ahead of the launch of Cursor's new Composer model.
Next, we'll see if it can help improve Grok, the company's own frontier model, enough to stand next to OpenAI's GPT and Anthropic's Claude, the leaders in the frontier race. If Cursor's developer data gets Grok there, Musk gets a seat at the big-boy table. In turn, this makes it far easier to raise the amount of capital needed for its full infrastructure build-out.
SpaceX's listing drew investor attention to the broader space economy, including lunar infrastructure. Intuitive Machines (Nasdaq: LUNR) has emerged as a leading public name in NASA's commercial Moon program, with record revenue and a US$1.1 billion backlog.
, /PRNewswire/ -- American News Group Market Commentary, The public listing of Space Exploration Technologies Corp. (NASDAQ: SPCX) As the most valuable private enterprise in the world arrived on the public market, it reframed the entire space sector as an investable theme — and capital began searching for the listed names attached to each piece of the opportunity. Among the threads that drew fresh attention was one of the most evocative: the return to the Moon. Get our free Orbital Economy Signal Brief for plain-English intelligence on the commercial-space sector, delivered as it moves.
Key Takeaways
The SpaceX IPO reframed space as a public-market theme, and reporting noted a broad rally across space stocks tied to lunar and Moon-base initiatives. Intuitive Machines (Nasdaq: LUNR) reported record Q1 2026 revenue of about US$186.7 million, nearly triple the prior year, with a backlog of about US$1.1 billion. Growth was driven by its US$800 million Lanteris Space Systems acquisition and NASA and U.S. Space Force contracts, including selection for the Andromeda IDIQ with a ceiling reported up to US$6.2 billion. Other listed names spanning lunar and space infrastructure include Voyager Technologies (NYSE: VOYG) and Boeing (NYSE: BA) — each distinct, and neither a proxy for the other. From One Mega-IPO to a Sector-Wide Re-Rating
Reporting around the period noted a rally across space stocks tied to NASA's lunar ambitions and Moon-base planning. SpaceX itself is central to that story — its Starship is integral to NASA's Artemis program — but the lunar economy is being built by a wider set of companies, several of them already public. The one that has moved most decisively into that role is Intuitive Machines.
Intuitive Machines: A Lunar Pioneer Turning Into a Space Prime
Intuitive Machines (Nasdaq: LUNR), based in Houston, first drew headlines as a lunar-lander company — its Nova-C spacecraft became the first U.S. vehicle to soft-land on the Moon since Apollo. But its 2026 story is one of transformation from a single-mission lunar specialist into a vertically integrated, multi-domain space contractor. In the first quarter of 2026, the company reported record revenue of about US$186.7 million — nearly triple the prior-year period — alongside positive adjusted EBITDA of US$2.7 million and a contracted backlog of roughly US$1.1 billion.
The leap was powered by its roughly US$800 million acquisition of Lanteris Space Systems, which broadened the company well beyond landers, plus a run of government awards. Management described a revenue mix split across commercial, civil, and national-security customers, and pointed to milestones including a NASA Commercial Lunar Payload Services task order for its IM-5 mission and selection for the U.S. Space Force's Andromeda IDIQ, a space-domain-awareness program with a ceiling reported as high as US$6.2 billion. The company reaffirmed full-year 2026 revenue guidance of US$900 million to US$1 billion.
As ever, the counterweight matters. Intuitive Machines carries concentrated exposure to government contracts and their appropriations timing, integration risk from rapid acquisitions, and the simple reality that lunar missions are difficult — its earlier landing famously tipped on touchdown while still returning data. The backlog provides visibility; it does not eliminate execution risk.
Why the Lunar Economy Is Suddenly an Investment Category
The deeper shift the SpaceX IPO helped surface is that "going to the Moon" has become a procurement program, not just an exploration goal. NASA's Artemis effort and its associated Moon-base planning are designed to be executed substantially through commercial contracts — landers, terrain vehicles, communications relays, and surface infrastructure bought from private companies. That converts a national ambition into a recurring revenue opportunity for the firms positioned to win the work, and it is why a lunar-services company's backlog and contract wins now read like those of any other government-exposed growth business. Intuitive Machines has leaned directly into that, expanding from landers into space-to-Earth data relay through planned acquisitions of ground-station assets, building toward the kind of integrated infrastructure the program will need for years. Tracking how this sector is being repriced in real time? Join the free Orbital Economy Signal Brief to follow the shifts as they happen.
The Wider Lunar-and-Infrastructure Field
A couple of other listed companies frame the broader infrastructure landscape around the lunar and space-services theme — each distinct, and neither a proxy for the other. Voyager Technologies (NYSE: VOYG) is a space-and-defense technology company working across propulsion, precision systems, and space-infrastructure programs, and has been awarded a series of defense and space contracts as it builds out its platform. Boeing (NYSE: BA) anchors the large-cap, incumbent end: a diversified aerospace-and-defense prime with deep space heritage spanning human spaceflight, satellites, and major NASA programs. It is the steadier, established route into the same broad theme, with none of the pure-play torque — or the pure-play risk — of a smaller name. Together they show a lunar-and-space-infrastructure trade that runs from focused specialists to century-old primes, all drawn closer to the spotlight as SpaceX's listing re-rated the category — though each remains tied to its own contracts and execution.
Another Name in the Space-Access Field
Among the smaller, specialized names in the field is Starfighters Space, Inc. (NYSE American: FJET), referenced here purely for context and not as a recommendation. Over recent months the company has announced a series of partnership and development steps, including engaging Integrated Launch Solutions (ILS) to support mission design and range integration for its STARLAUNCH pathway, joining the NSF-proposed C-STARS research consortium at the University of Florida, and expanding a partnership with Mu-g Technologies on microgravity research. The company has said it is targeting a STARLAUNCH II space-demonstration flight over a roughly 18-to-24-month window, subject to regulatory approvals and execution. These are the company's own publicly stated plans.
The Bottom Line
SpaceX's arrival on the public market turned the space economy into a theme investors feel they must understand — and the road back to the Moon is one of its most tangible pieces. Intuitive Machines has positioned itself as a leading public name in that build-out, with record revenue, a billion-dollar-plus backlog, and a deliberate pivot from lunar lander to multi-domain space prime. The opportunity is real and contract-backed; so are the risks of government timing and acquisition integration. For investors drawn to the lunar story the SpaceX IPO helped illuminate, the names are now public and the milestones are now scheduled — with the data, as always, still to be delivered. To keep a closer eye on the launch, satellite, lunar, and space-data economy as it develops, sign up for the free Orbital Economy Signal Brief.
SIGNAL OVER NOISE
Signal over noise. Space, lunar, and defense headlines move fast — and the crowd often moves first. Eagle Eye is a real-time investor signal-intelligence platform that surfaces sentiment shifts, news flow, and trending tickers as they happen, so you see the move forming instead of reading about it later. See it at eagle-eye.dev.
CONTACT
American News Group
[email protected]
SOURCES
[1] Space Exploration Technologies Corp. (SpaceX), Form S-1 registration statement (proposed Nasdaq symbol SPCX), May–June 2026, sec.gov; contemporaneous reporting on space-sector reaction.
[2] Intuitive Machines, Inc. (Nasdaq: LUNR), Q1 2026 financial results (record revenue, US$1.1B backlog, Lanteris, Andromeda IDIQ, IM-5), May 2026.
[3] Voyager Technologies, Inc. (NYSE: VOYG), corporate and contract disclosures, 2026.
[4] The Boeing Company (NYSE: BA), corporate and space-program disclosures, 2026.
[5] Starfighters Space, Inc. (NYSE American: FJET), company press releases (Integrated Launch Solutions engagement; C-STARS; Mu-g partnership; STARLAUNCH II demonstration timeline), 2026.
DISCLAIMER
IMPORTANT — PLEASE READ: This article is editorial commentary and was NOT paid for, requested, commissioned, reviewed, or approved by any of the companies named in it, nor by Creative Direct Marketing Group ("CDMG"). No company mentioned in this article paid for or had any involvement in its preparation or publication. The disclosures that follow are provided in the interest of full transparency regarding our broader business relationships, even though they do not apply to this specific article.
Nothing in this publication should be considered as personalized financial advice. We are not licensed under securities laws to address your particular financial situation. No communication by our employees to you should be deemed as personalized financial advice. Please consult a licensed financial advisor before making any investment decision. This publication is neither an offer nor a recommendation to buy or sell any security. We hold no investment licenses and are thus neither licensed nor qualified to provide investment advice. The content in this report or email is not provided to any individual with a view toward their individual circumstances. American News Group is owned and operated by Market IQ Media Group Limited, a company incorporated under the laws of Ireland ("MIQL"). As part of its ongoing business, MIQL has been paid fees by CDMG for advertising and digital media for Starfighters Space, Inc. (NYSE American: FJET) in connection with separate, paid campaigns; those paid materials are distinct from this article, which is unpaid editorial. This relationship constitutes a potential conflict of interest as to our ability to remain objective in our commentary regarding Starfighters Space, Inc., and readers are strongly encouraged not to use this publication as the basis for any investment decision. MIQL and its owner/operators do not own shares of Starfighters Space, Inc. or of any other company named in this article in connection with this piece, but reserve the right to buy and sell securities of any company mentioned at any time without further notice. While all information is believed to be reliable, it is not guaranteed by us to be accurate. Individuals should assume that all information contained in our publication is not trustworthy unless verified by their own independent research. Always consult a licensed investment professional before making any investment decision. Be extremely careful, investing in securities carries a high degree of risk; you may likely lose some or all of the investment.
FORWARD-LOOKING STATEMENTS: This publication contains forward-looking statements concerning the companies referenced and the commercial-space sector, including statements regarding the proposed initial public offering of Space Exploration Technologies Corp. ("SpaceX") and its reported terms, which are based on third-party reporting and SpaceX's own filings and remain subject to change until and unless finalized; product development, launch and mission timelines; contract awards and backlog; and broader market conditions. Forward-looking statements are not guarantees of future results and are subject to risks and uncertainties — including execution, regulatory, financing, competitive and macroeconomic risks — that could cause actual results to differ materially, as detailed in each referenced company's filings with the U.S. Securities and Exchange Commission at www.sec.gov. References to SpaceX are for thematic and contextual purposes only; SpaceX is a separate company with no affiliation to the publisher, and nothing herein is an offer to buy or sell, or a solicitation of any offer to buy or sell, securities of SpaceX or any other company. Figures attributed to named companies are drawn from those companies' public disclosures. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date made; the publisher undertakes no obligation to update or revise them except as required by applicable law.
SpaceX became one of the quickest additions ever to the Nasdaq-100 index, setting up a fresh wave of buying from passive investors less than a month after the company's blockbuster public debut.
Nasdaq announced after the close Friday that SpaceX qualifies for inclusion in the benchmark technology index. Assuming the company meets the requirements, index-tracking funds and other product sponsors would begin purchasing shares after the market closes on July 6, with SpaceX officially joining the Nasdaq-100 before trading begins on July 7.
More than $800 billion tracks the index, including the Invesco QQQ Trust (QQQ), which is one of the most popular securities traded each day and is seen as a barometer for the artificial intelligence bull market.
The aerospace and satellite company is expected to enter the index with a weighting of less than 1%.
Adding SpaceX this quickly would make the Elon Musk company one of the first beneficiaries of Nasdaq's recently adopted fast-track inclusion framework for newly public companies. The changes allow some large IPOs to become eligible for the Nasdaq-100 after just 15 trading days, dramatically shortening what had historically been a far longer waiting period.
Under the previous framework, investors tracking the Nasdaq-100 could be forced to wait months before gaining exposure to newly listed market giants.
The inclusion could create another source of demand for SpaceX, which has been one of the most actively traded stocks since its June 12 debut. Index funds and exchange-traded funds tied to the Nasdaq-100 would need to buy shares to match the benchmark's new composition, while active managers who track the index closely might also adjust positions.
Because SpaceX's publicly tradable float remains small compared with its total market capitalization, even a modest index weighting could require meaningful purchases from passive investment vehicles.
Earlier this month, S&P Dow Jones Indices declined to create a similar fast-track process for the S&P 500. Therefore, SpaceX remains ineligible for inclusion in the S&P 500 because of that index's separate profitability and seasoning requirements.
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Stock Market Skids As Trump Blasts Iran; Warsh Appearance, Jobs Report Due SpaceX stock will be added to the Nasdaq-100 index before the open on Tuesday, July 7, Nasdaq confirmed late Friday. That will pave the way for passive investment flows from mutual funds and ETFs that track the big-cap tech index. The SpaceX news is not a surprise. Nasdaq recently announced fast-track rules for large IPOs to join the Nasdaq-100 index…
Whether you think Space Exploration Technologies Corp. (SPCX +0.15%), commonly known as SpaceX, is fairly valued at $2 trillion or not, there's no denying its plans are ambitious.
SpaceX plans to dominate the AI computing market by putting data centers into outer space. Admittedly, this would solve a bunch of problems. Unfortunately, it would also likely cause a whole host of new ones.
If SpaceX is unable to pull it off, one sector is likely to be a big winner. Here are the flaws in SpaceX's "out-of-this-world" plan, and the surprising "down-to-earth" company likely to benefit.
Keeping it cool AI spending is continuing to grow, and one of the biggest expenditures is on building new AI data centers.
Image source: Getty Images.
These facilities require lots of electricity. A recent report by the International Energy Agency found that a ChatGPT query consumes 10 times as much electricity as a Google search.
All that electricity use cranks out a lot of heat, so AI data centers also require massive cooling systems to prevent overheating. Air-cooled systems require even more electricity to operate, while liquid-cooled systems require massive amounts of water.
Recently, the AI data center buildout has run into a new snag. Across the country, concerned residents have successfully petitioned local zoning boards and other elected officials to prevent the construction of proposed AI data centers in their communities, citing environmental concerns and the impact on local electricity and water supplies.
SpaceX's plan sounds like a simple solution to this problem: Instead of battling locals over your energy-intensive data center, just put it into orbit instead.
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In space, no one can see you sweat Outer space is extremely cold under most circumstances, with a temperature of about -455 degrees Fahrenheit. Logically, with a base temperature that cold, your orbital data center wouldn't need a cooling system, which would lower your computing costs.
As for the huge power requirements, SpaceX points out that solar power is actually more concentrated in space, making solar panels more efficient. By attaching solar panels to the orbital center and aiming them at the sun, you could inexpensively generate enough power to operate the data center, further lowering costs.
When it comes to communicating queries to and from the AI, SpaceX would simply utilize and expand its existing Starlink satellite network.
It all sounds so simple, you have to wonder why nobody's tried it before.
Image source: Getty Images.
The obvious flaws with SpaceX's plan Well, nobody's tried it because of the obvious, glaring flaws in the plan.
First of all, the cold environment in space isn't necessarily a good thing. Most electrical equipment can't function at temperatures below about -340 degrees Fahrenheit, because electrons lose the thermal energy required to move and stop flowing. There are ways around this issue, but they require costlier materials, components, and designs. A recent report by Wood Mackenzie estimates that a 1-gigawatt orbital data center would cost about $170 billion, more than three times that of an equivalent terrestrial facility.
Meanwhile, AI data centers and solar arrays contain thousands of small, interconnected components, such as circuit boards, wires, and fuses. If one of those components fails in a terrestrial facility, a technician can quickly walk over and fix the problem. Not in outer space! Although launch costs have come down in recent years, it's unlikely to ever get so cheap as to justify the cost of launching and performing a spacewalk to swap out a fuse.
Who will win? Wood Mackenzie estimates that the cost of an orbital data center would need to drop by 70% to be competitive. That could happen by 2040 or so if launch costs continue to drop exponentially, but in the meantime, we'll still have to use terrestrial data centers and absorb their massive electricity requirements.
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And that's where electric utility stocks stand to benefit. One of the likeliest beneficiaries is American Electric Power (AEP +1.23%), which operates the largest electricity transmission network in the U.S., and operates in regions that have been historically friendly to large-scale energy development, including Texas, Oklahoma, Louisiana, and Appalachia. It also has a near-monopoly on 765-kilovolt power transmission infrastructure.
Recently, AEP instituted a "Data Center Tariff" in Ohio, prompting data center developers to sign binding contracts for 5.6 gigawatts of data center load. This insulates the utility from the financial repercussions if a data center project doesn't use its projected capacity or gets canceled altogether.
With a 2.8% dividend yield and huge expansion prospects, AEP will likely pay off for investors long before SpaceX's orbital data centers even get off the ground (literally).
Space Exploration Technologies (SPCX +0.13%) has plenty of supporters, including the billionaire investor Ron Baron -- and for good reason.
Baron founded the asset management firm Baron Capital in 1982 with just $10 million. Earlier this month, the fund had total assets nearing $56 billion. SpaceX and Tesla (TSLA +1.38%) founder Elon Musk have played a big role in Baron Capital's gains over the past 12 years, and Baron thinks SpaceX is poised to be something special.
Here's what a $50,000 investment in SpaceX stock today could be worth in a decade, according to Baron.
Image source: Getty Images.
Baron Capital has made a killing off Elon Musk Baron is widely considered one of the best growth investors ever, so it should come as no surprise that some of Musk's companies appealed to him. Baron first struck it rich off Musk by investing $400 million in Tesla between 2014 and 2016.
That turned out to be a good bet. Baron, on CNBC, said the fund has made about $8 billion in profit from its Tesla investment. This also served as a segue into SpaceX. Baron started investing in SpaceX when it was private in 2017, eventually building a $1.7 billion stake.
In a letter to investors earlier this year, Baron said the SpaceX position would be worth $24 billion if SpaceX proved successful in raising $70 billion. Including the greenshoe allocation -- additional shares that the underwriters have the right to purchase following a company's initial public offering -- SpaceX raised close to $86 billion.
SpaceX also trades at a market cap of roughly $2 trillion, and Baron bought an additional $1 billion worth of shares in the IPO.
Why Baron thinks SpaceX will moon Baron thinks Musk and SpaceX have a huge head start on the competition, at least a decade, when it comes to making satellites and rockets and building networks. Baron has also long been a believer in Elon and doesn't think there will ever be anyone like him again.
While SpaceX's artificial intelligence unit (which houses the Grok intelligence platform, data centers, and a potential future chip manufacturing facility) has grabbed most of the attention in discussions of SpaceX's growth potential, Baron is extremely excited about the company's low Earth orbit satellite internet service, Starlink.
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"It's going to be the internet for the entire planet," Baron said on CNBC on June 16, adding that the service is now planning to eventually have 100,000 satellites because the demand for data is so massive.
In a decade, Baron also expects Starlink to generate $1 trillion in annual revenue and about $700 billion to $800 billion in earnings before interest, taxes, depreciation, and amortization (EBITDA), which he believes would put the value of Starlink alone at $14 trillion.
Baron is also excited about the company's artificial intelligence unit, specifically the potential for orbital data centers, which he thinks SpaceX can launch as soon as 2027. In fact, in three years, Baron thinks it's possible that SpaceX will have 1 million satellites in space.
Finally, Baron is also extremely excited about the facility SpaceX is planning to build in partnership with Tesla and Intel, which will focus on building custom chips that are cheaper and specifically designed for the performance needs of these companies.
Baron's expectations for the stock Needless to say, Baron is as enthusiastic about SpaceX as anyone out there.
Retail investors should be careful not to blindly follow institutional investors and instead conduct their own due diligence.
While Baron is widely regarded as one of the best investors, institutional money can get it wrong just like anyone else. Furthermore, several things need to happen for Baron's predictions to come true.
For one, SpaceX needs to make its heavy-lift, fully reusable rocket, Starship, operational. It must also determine whether orbital data centers are feasible and how much they could cost.
That said, in a letter to shareholders in late April, Baron said he expects SpaceX to be worth 10, 20, or even 30 times its post-IPO value in 10 to 15 years. If he's correct, a $50,000 investment in SpaceX around the IPO price of $135 could be worth anywhere from $500,000 to $1.5 million.
I think it's difficult to make a call like this so early in the company's public life, but if you are looking for a bull on SpaceX, Baron is your guy.
No stock has been discussed as much over the past few weeks as Space Exploration Technologies (SPCX +0.13%), or SpaceX, as the company set an initial public offering (IPO) record, raising $75 billion and being valued at $1.77 trillion.
The stock experienced a nice run-up in its first few trading days but has since been on a downward trajectory. As of market close on June 23, SpaceX's stock was down 3% since its IPO. Many investors expected the volatility it has been experiencing, but it may be sooner than expected.
Regardless of how SpaceX pans out over the next few weeks, I wouldn't consider investing in SpaceX (or adding more shares) for another 90 days. Here's why.
Image source: Getty Images.
More shares will be hitting the market soon To prevent a bunch of shares from hitting the market for sale immediately after an IPO (which could cause the stock to crash), the U.S. Securities and Exchange Commission (SEC) encourages a lockup period where insiders, such as employees and investors, must hold on to their shares before being able to sell them. The SEC doesn't legally require a set lockup period, but it's universally accepted as good business practice.
SpaceX also made only about 4% of its total shares available to the public in its IPO. As milestones are met, SpaceX will issue additional shares to the public to gradually increase liquidity.
Here is the current schedule of SpaceX's lock-up periods and the number of shares expected to be released at each time.
Key DatesDays Post-IPOSupply ReleasedLate July or early August 2026 (Q2 earnings)TBD20% to 30%Aug. 20, 202670 days7%Sept. 9, 202690 days7%Sept. 24, 2026105 days7%Oct. 9, 2026120 days7%Oct. 24, 2026135 days7%Late October or early November 2026 (Q3 earnings)TBD28%Dec. 8, 2026180 daysRemaining employee balanceFebruary 2027 to August 2027240 to 420 days100% of institutional investorsJune 12, 2027366 days100% of Elon Musk's stake Data source: SpaceX's 424B4 filing.
As more shares become available and insiders unload some of their holdings, SpaceX's stock could face downward pressure. After the 90-day mark in September, when the second block of shares is released, we'll have a clearer picture of how the market is reacting to the new shares. Less than 10% of SpaceX shares would be floating around, but that's much more liquid than they are now.
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Will SpaceX be a buy after 90 days? One thing about the stock market is that nobody can predict how stock prices will move in the short term. We can make educated guesses, but those rely on rationality, and the stock market is far from rational. That said, history suggests that SpaceX's stock could underperform over the first couple of years after its IPO.
There are exceptions to every rule, but that has been the norm for many blockbuster IPOs. I would reassess SpaceX's stock after 90 days, but even then, I wouldn't rush to invest unless it's somehow trading at a much steeper discount.
When a company raises $86 billion in the largest IPO in history and then turns around five days later to borrow another $25 billion, one of two things is true: It has identified an opportunity so large that no amount of capital is enough, or it has taken on obligations it cannot fund from operations.
With Space Exploration Technologies Corp (SPCX +0.13%), both are true simultaneously, and that tension is exactly what the last 10 days of share transactions have been processing.
The anatomy of the SpaceX debt SpaceX's $25 billion bond offering, priced Tuesday in five tranches with maturities ranging from five to 30 years, is the company's first-ever investment-grade dollar bond issuance. The primary purpose of the raise is not to build new rockets. It is to refinance a $20 billion bridge loan that SpaceX took out in March, when it absorbed Elon Musk's X and xAI in an all-stock deal -- and those companies' combined $17.5 billion in existing debt came along with them.
Image source: Getty Images.
The sequencing matters. SpaceX went public, raised $86 billion, and the very next week turned to the bond market because the bridge loan needed to be repaid and the AI infrastructure build-out requires capital that the IPO proceeds don't fully cover. The offering attracted close to $85 billion in orders, a genuine sign of institutional demand. But bond investors required a premium over Treasuries -- described as "large" -- to get the deal done. That premium is what sophisticated fixed-income buyers charge when they're not certain a company's cash flows fully support its debt load.
Oppenheimer analysts, in initiating coverage, projected SpaceX will carry more than $400 billion in net debt by 2031. That number assumes the AI capital spending cycle continues at its current pace, which is precisely the assumption that deserves scrutiny.
What AI revenue looks like here SpaceX announced a $6.3 billion AI infrastructure deal with a start-up called Reflection AI on the same day it announced the bond sale, framing it as validation of the AI strategy. What the Bloomberg terminal data revealed: Reflection AI's records value the company at $3.6 million. SpaceX is lending $150 million per month in compute to a start-up worth less than one hour of SpaceX's IPO proceeds, under a contract it can terminate after three months. The deal didn't stabilize the stock. Shares fell for a third consecutive session on the news.
The deeper problem is that xAI -- the division that SpaceX absorbed and is now borrowing billions to expand -- generated $818 million in revenue against $2.47 billion in operating losses in Q1 2026 alone. Grok, xAI's large language model, has not demonstrated measurable market share against OpenAI or Alphabet's Google Gemini. SpaceX is taking on long-dated debt, payable over 30 years, to fund a bet on an AI product that is currently losing $3 for every $1 it earns.
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The broader AI valuation problem investors should look at This is where SpaceX's balance sheet decisions collide with a marketwide reckoning that the June sell-off has started to force. The entire premise of AI-driven valuations in 2024 and 2025 rested on a chain of assumptions: that infrastructure spend would translate to revenue, that revenue would compound fast enough to justify current multiples, and that the biggest spenders would capture the most value. That chain hasn't held.
Microsoft's Copilot, after two years of heavy marketing, is still a story about enterprise seat licenses -- not the mass-market productivity revolution that justified its valuation premium. Google announced $175 to 185 billion in capex this year, and its stock sold off before recovering. Amazon is deploying $200 billion on a timeline where returns are years away. The pattern is consistent: AI companies are spending as if demand will arrive faster and at higher margins than current economics support.
SpaceX is now borrowing at scale to join that race in a market already asking whether the leaders can justify what they've already spent. The stock has erased $400 billion from its post-IPO peak and trades at $157.60, near its first-day close. That's not panic. It's a reassessment.
The bull case is real: cheap long-dated capital, and Grok training on Starlink data from 10 million subscribers is a genuine moat. But the bear case is also recognizable -- using one extraordinary business as collateral to fund AI bets at valuations that may never be recovered. That's what Softbank did. It lost $27 billion in fiscal 2022.
For investors holding SpaceX stock, you're not just owning a launch and satellite company anymore. You're owning an AI conglomerate with $29.1 billion in long-term debt and projections pointing toward $400 billion more. The IPO prospectus told you that was the plan. The question is whether you signed up for it.
Clearly, there's money to be made in space. SpaceX's historic initial public offering minted a $2 trillion company. And even as shares in Elon Musk's company come down from their IPO high, there remains an underlying boom in the space economy that is creating a new job market for Americans.
The space economy is growing domestically and around the globe, at an annual rate of 9%, according to the World Economic Forum. In the U.S., gross output in the space economy increased by nearly $51.5 billion from 2012 to 2023. The sector's total value reached an all-time high of $613 billion in Q2 2025, according to the Space Foundation.
As the space economy grows, it is spurring national job creation. In the private sector alone, over 373,000 employees work space-sector jobs, according to the most recent estimates from the Department of Commerce Bureau of Economic Analysis. That remains a small fraction of the total U.S. private-sector workforce, but one that is growing rapidly. Space-sector employment increased by 27% in the decade through 2024, far outpacing total private-sector employment growth at 14%, and with its rate of growth accelerating in the more recent years. From 2019 to 2024 alone, the space economy's job market grew by 18%.
Young workers in particular have played a major role in this growth. According to the U.S. Census Bureau, nearly half of the new jobs being added to the space economy are filled by workers under the age of 35, accounting for a 3% total increase in young workers' share of its workforce from 2014 to 2024. Across most major lines of work in the space sector, there has been an increase in the share of young workers employed. That means the sector isn't just growing, but also defying the trend of decreasing young worker share seen throughout other Census-surveyed sectors, including professional services and media.
Dean Boerner, a lead data scientist at Revelio Labs, found in his recent research looking across tens of thousands of postings from hundreds of space sector companies that the industry is significantly outperforming the broader labor market in providing current career opportunities.
"Active postings by companies operating within the space economy are up more than 40% year-over-year as of this month (and have generally been elevated this entire year, compared to 2025)," Boerner said. "U.S. postings overall are down about 5%, making the rise in opportunities within aerospace particularly striking," he added.
Compensation for aerospace-centered work is attractive. The private space sector boasts a combined annual payroll of around $57.9 billion, with median annual salaries varying by occupation, but typically within the range of $100,000 to $135,000. Base salaries, however, are only one part of the employee compensation packages seen in the private sector. Large private space market employers often offer stock options, giving employees the opportunity to get in early on what could become a major publicly-traded company. In the case of SpaceX's historic IPO, thousands of current and former employees became millionaires overnight thanks to their pre-owned shares. Over 100 saw a newfound net worth of over $1 billion.
"This job market is competitive, often with thousands of applications for each entry-level role," said Dave Baldwin, director of talent acquisition at Firefly Aerospace, which went public last August.
And yet, thousands of positions at these companies remain unfilled on any given day. In fact, despite the attractive roles and seemingly promising upward trends in an increasingly lucrative field, employment in the space economy has largely failed to keep pace with industry scaling. Space sector companies of all varieties, in recent years, have seen prolonged hiring periods, high employee turnover rates, and persistent labor shortages. One reason is that the work relies heavily on highly skilled labor, disproportionately within the realm of science, technology, engineering, and mathematics (STEM).
Recent estimates indicate that over half of private-sector space economy jobs "require STEM skills," approximately double the national average. STEM skills, as important as they are, pose a real hurdle for firms looking to recruit and retain new talent. Only about a quarter of the American workforce has formal STEM training, a far smaller fraction of which has the specific vocational background needed in aerospace production. For employers building out their presence in the space economy, this means continually competing for the select pool of workers who possess the skillsets needed to sustain current operations and long-term growth.
SpaceX, in its own S-1 filing ahead of its IPO, acknowledged this issue as a potential risk for investors, stating: "We depend on our ability to recruit and retain employees who have advanced engineering and technical skills, and intense competition for such employees may increase costs and affect our ability to meet development and production timelines."
"The current tight labor market has adversely impacted our ability to recruit qualified personnel, including engineers, particularly with respect to our AI segment," the filing noted, underscoring the challenges posed by rapid space economy expansion.
Revelio Labs' data shows the magnitude of the issue, with the 45% delta in active postings between the sector and the rest of the economy (40% growth in postings for space jobs and 5% decline for all U.S. jobs).
Several active, high-profile employers in the aerospace sector are at the forefront of hiring struggles. Lockheed Martin has the second-most open postings among all employers, with 10,614, a figure that has increased by over 5,000 from this time last year. RTX Corp leads all employers with 12,871 openings globally. According to Boerner, the most in-demand roles are, in order, Safety Engineer, Information Security, Integration Engineer, Reliability Engineer, and Hardware Engineer, with each role requiring at least a bachelor's degree in a related field of study.
A 2025 Aerospace Industries Association (AIA) report, carried out in collaboration with McKinsey & Co., found that the attrition rate for the aerospace industry, from 2021 through 2024, sat at nearly 16%, over 10% higher than any other industry category. Seventy-six percent of all AIA member organizations worldwide reported "sustained challenges" in consistently hiring engineers.
Skilled labor for space manufacturing is in short supplyThe labor challenges in the sector also extend to key manufacturing roles, with 56% of the organizations reporting challenges in hiring and sourcing skilled manufacturing talent. Nearly 30% of the work that takes place in the space economy revolves around skilled manufacturing, labor that is necessary for the production of space vehicles, space weapons, and satellites.
Satellites, in particular, have been driving recent growth as the space markets shift away from exploration, at least in the near-term, and to commercialization. In 2024, according to Space Foundation estimates, the commercial space products and services industry comprised well over half of the economy's total value, a shift largely attributed to the enhancement and expansion of satellite technology. It's a trend that is being supported by the value of satellite-based data across the global economy, for example, in optimizing fleet routing in unprecedented ways and improving globalized supply chains, allowing companies to make their industrial capacity more efficient and extend their global consumer reach.
But the industry doesn't have a monopoly on the talent that is required.
"The challenge is there's a limited pool of machinists, welders, and technicians to meet the demand," Baldwin said. "There are multiple industries (e.g., automotive, semiconductor, biotech) in addition to aerospace that are competing for the same types of skilled workers," he added.
For Firefly and peer space economy employers, investing in early talent at the right stages is a critical issue. The AIA report revealed that among space sector companies struggling with hiring and retention, just 20% had taken steps to develop or expand training programs. In fact, creating and expanding training programs lagged behind referral bonuses for current employees, increasing geographic recruitment areas, and changing compensation models.
"It's critical for commercial space companies to partner with local high schools, community colleges, and universities to develop skill-based programs and help increase the supply of available skilled labor," Baldwin said. "We've been scaling up these efforts at Firefly, providing the opportunity to get hands-on experience working on proven launch, lunar, and in-space programs. We also offer training and apprenticeships to help veterans transition into the workforce as part of the DoD SkillBridge Program."
Club for the Future, an early education foundation established under the Jeff Bezos-led space company Blue Origin in 2019, states its mission as "to inspire future generations to pursue careers in STEM and to help invent the future of life in space."
Since 2021, the foundation has donated tens of millions of dollars to educational programs alongside space-based charities. Nearly every large private aerospace manufacturer funds extensive internship programs year-round, although the programs tend to be extremely competitive, and their frequency wanes among smaller employers.
While SpaceX is likely to remain a volatile stock, it is becoming more embedded in the market, soon to be added to the Nasdaq 100 index. If SpaceX bulls are correct, the early education investments will pay off in the decades ahead for employers and the workforce. Early SpaceX investor Ron Baron says the company will grow more quickly than many people expect. The billionaire fund manager recently told CNBC he didn't sell a share in the IPO and expects the company to be valued in 10 years at a minimum of $20 trillion. "Normally, our economy doubles roughly every 10 years," Baron told CNBC's Becky Quick. "What he thinks is, by the innovations and the work that he's doing, he's going to make the economy grow 10 times in 10 years, not double."
Cory Johnson believes the SpaceX (SPCX) IPO is "pretty unique," saying that the stock holding above its IPO price with current valuations is "kind of a miracle." He attributes the price action to the rising demand for the IPO market that includes names like Anthropic, which Cory calls "the biggest company out there.
Most retail investors were not able to get Space Exploration Technologies (SPCX +0.15%), or SpaceX, stock at the initial public offering (IPO) price. After the $135 share offering, though, SpaceX stock opened trading at $150 per share before closing its IPO day at just under $161.
That $150 level essentially became the lowest trading price for SpaceX until it breached it this week. That's important psychologically for two reasons. Here's what it could mean going forward.
Image source: The Motley Fool.
SpaceX falls back below the $2 trillion threshold for a time That $150 share price also represents a market cap of just under $2 trillion. While several large tech companies are now worth more than $2 trillion, that level is still meaningful. It's especially notable when comparing SpaceX's financial status with that of the highly profitable big tech companies.
Yet even as the company reported a $4.9 billion loss in 2025, the stock stemmed the slide and bounced back above $150. Financial losses were driven by a massive $6.35 billion loss in its artificial intelligence (AI) segment, though. SpaceX's Starlink broadband connectivity segment was highly profitable.
Retail investors rally The recent pullback after the IPO spike represents a drop of over $500 billion in market value. Retail investors haven't been discouraged, though. SpaceX remains one of the top Reddit discussion group stock names, with bullish sentiment. But there still might be a better entry point ahead.
Lockup expirations after the IPO will inevitably bring more sellers into the market. And while the largest IPO in history has brought shareholders paper profits so far, there's no guarantee that will last. The second-largest IPO ever, Saudi Aramco, has lost money for shareholders to date, according to recent research from The Motley Fool.
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Long-term perspective The good news for investors is that Reddit boards, lockup expirations, and short-term moves are really all just noise. SpaceX has a bright future with significant potential. Starlink will have competition, but costs can be held in check thanks to the company's space launch segment. And the AI business is in growth mode, so investing for growth and experiencing losses are expected at this stage.
The recent announcement that the company issued $25 billion in bonds should serve as a reminder that it still requires capital to meet its growth plans. It will also likely report further losses when it announces its first quarterly results as a public company. Traders and short-term thinkers will probably help drive shares lower, along with early investors cashing in. That's when investors thinking about SpaceX as a long-term holding should be looking to buy.
Howard Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Reddit. The Motley Fool has a disclosure policy.
SpaceX (SPCX +0.15%) stock suffered a huge pullback in its second full week of trading following its initial public offering on June 12. The company's share price declined 20.2% in a week of trading that saw the S&P 500 decline roughly 2%, and the Nasdaq Composite fall 4.6%.
In addition to bearish momentum for the broader market, SpaceX's valuation contracted in conjunction with fading post-IPO excitement. The company's share price closed out the week down roughly 4.8% from the $160.95 per share price it had on the day of its public debut, and the stock is now down 24% from its high.
Image source: Getty Images.
SpaceX's bullish post-IPO momentum evaporated this week By most measures, SpaceX's IPO was an enormous success. The company's share price surged above its initial listing price of $135 per share, and it still trades up 13.5% compared to that level. The tech specialist had the biggest IPO in history, and its first stock sale allowed the company to raise $85.7 billion.
On the other hand, early excitement surrounding the company's public debut clearly faded this week. Bearish momentum for the broader market tied to concerns about artificial intelligence (AI) chip stocks likely weighed on SpaceX because the company is making AI processing services a focal point of its growth strategy, and investors hoping to score more quick gains with the stock moved out of positions as positive momentum began to fade.
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What's next for SpaceX? SpaceX stock could continue to be highly volatile in the near term as the market continues to move through a price discovery phase with the equity. With a market capitalization of roughly $2.02 trillion, SpaceX is valued at approximately 108 times last year's revenue.
While the business looks poised to expand at a rapid pace, its highly growth-dependent valuation sets the stage for volatility in the face of company-specific catalysts and assessments and broader trends. With concerns about the macroeconomic picture and whether the powerful bull run for AI stocks is poised to continue, SpaceX is facing a test of valuation pressures early in its history as a publicly traded company.
Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
SpaceX's public listing cast Starlink Mobile as a future wireless challenger. AST SpaceMobile (NASDAQ: ASTS) is the most prominent publicly traded company pursuing the same direct-to-device satellite-broadband market.
Key Takeaways
The SpaceX IPO prospectus framed Starlink Mobile as a direct-to-smartphone service intended to compete with terrestrial mobile networks — spotlighting a market that public investors cannot access through SpaceX alone. AST SpaceMobile (NASDAQ: ASTS) is the most prominent listed company building a direct-to-device satellite-broadband network, connecting ordinary, unmodified smartphones from space. AST has reported securing over US$1.2 billion in aggregate contracted revenue commitments from partners, and is targeting 45 to 60 satellites in orbit by the end of 2026. Other listed satellite-connectivity names include Globalstar (NASDAQ: GSAT) and Viasat (NASDAQ: VSAT) — each distinct, and neither a proxy for the other. The IPO That Made Satellite-to-Phone a Headline
, /PRNewswire/ -- Equity Insider Market Commentary, When Space Exploration Technologies Corp. (SpaceX) filed to go public on the Nasdaq under the proposed ticker SPCX, the prospectus did more than reveal the financials of the world's most valuable private company. It laid out, in detail, how SpaceX intends to turn its Starlink constellation into a wireless competitor — casting Starlink Mobile as a direct-to-smartphone service designed to perform "on par with terrestrial mobile networks," with next-generation satellites slated to expand the offering beyond messaging toward full broadband and IoT connectivity. Get our free Orbital Economy Signal Brief for plain-English intelligence on the commercial-space sector, delivered as it moves.
That framing turned a once-niche idea — connecting an ordinary phone directly to a satellite, with no special hardware — into a front-page investment theme. But there is a catch for public investors: SpaceX's satellite-to-phone business is bundled inside an enormous company spanning launch, Starlink broadband, and an artificial-intelligence unit. For those seeking a focused, public-market way to play the direct-to-device race specifically, the most prominent name is not SpaceX at all. It is AST SpaceMobile.
AST SpaceMobile: The Public Pure-Play on Phones-From-Space
AST SpaceMobile (Nasdaq: ASTS), based in Midland, Texas, is building what it calls a space-based cellular broadband network designed to connect everyday, unmodified smartphones directly to its satellites — aiming to eliminate mobile "dead zones" worldwide. Where Starlink began as a fixed-broadband service using dedicated terminals, AST's entire thesis is the direct-to-device market that SpaceX's IPO filing has now thrust into the spotlight. That makes the two natural — if vastly differently sized — competitors in the same emerging category.
The company has been building both its constellation and its commercial foundation. AST reported full-year 2025 revenue of about US$70.9 million, driven by mobile-network-operator partners and the U.S. government, and said it had secured over US$1.2 billion in aggregate contracted revenue commitments from partners — a figure that speaks to the scale of carrier interest. It has also reported completing the in-orbit unfolding of BlueBird 6, which it described as the largest commercial communications array ever deployed in low Earth orbit, and has laid out a launch cadence intended to reach 45 to 60 satellites in orbit by the end of 2026.
The risk profile is equally clear, and worth stating plainly: AST is a capital-intensive, still-largely-pre-revenue business whose value depends on executing a demanding manufacturing-and-launch campaign on schedule. A successful deployment validates the model; a stumble in cadence or array deployment would do the opposite. This is a build-it-first business, and the build is far from finished.
How AST and SpaceX Actually Differ
It would be a mistake to treat AST as a miniature Starlink. The two take different technical and commercial approaches: AST partners with terrestrial mobile-network operators to extend their existing networks from space, positioning itself as a complement that carriers integrate, rather than a stand-alone consumer ISP. SpaceX, by contrast, has the advantage of owning its own launch vehicles — it flies Starlink satellites on its own Falcon 9 and Starship rockets — plus enormous scale and a head start in subscribers. AST's counter is focus and carrier alignment: it is building specifically for the direct-to-device use case in partnership with the incumbents whose customers it would serve. Which model wins, or whether both coexist, is exactly the open question the SpaceX IPO has made unavoidable. Tracking how this sector is being repriced in real time? Join the free Orbital Economy Signal Brief to follow the shifts as they happen.
The Wider Satellite-Connectivity Field
Beyond AST, a couple of listed satellite-connectivity companies help frame the landscape — each with a distinct model and risk profile, and neither a proxy for the other. Globalstar (Nasdaq: GSAT) provides mobile satellite services and wholesale capacity, reporting first-quarter 2026 revenue of about US$70.1 million, up 17% year-over-year, and has been a long-running infrastructure partner in the satellite-to-phone space. Viasat (Nasdaq: VSAT) anchors the broadband-and-connectivity end as a diversified satellite-communications operator serving aviation, government, and consumer markets. Together with AST, these names show that "satellite connectivity" spans several business models — wholesale capacity and diversified broadband — all being re-rated as the direct-to-device opportunity SpaceX highlighted draws fresh capital and attention. Each, however, will live or die on its own constellation, balance sheet, and execution.
A Note on the Broader Space Trade
One smaller name investors scanning the sector may note is Starfighters Space, Inc. (NYSE American: FJET), mentioned here for context only and not as a recommendation. The company has publicly described operating what it calls the world's only commercial fleet of flight-ready Mach 2+ supersonic F-104 aircraft from NASA's Kennedy Space Center, and in May 2026 it announced a US$17.5 million strategic equity investment led by institutional investors, with proceeds earmarked to support operational expansion and continued advancement of its STARLAUNCH platform. These are the company's own announced figures; readers should verify them in its filings.
The Bottom Line
The SpaceX IPO did more than reveal Starlink's economics — it confirmed that connecting ordinary phones directly to satellites is a market the most sophisticated player in space intends to pursue aggressively. For public investors, that validation lands not on SpaceX's sprawling franchise but on the focused names building in the same direction. AST SpaceMobile is the most prominent of them, with carrier commitments and an ambitious deployment plan — and the considerable execution risk that comes with building a constellation from scratch. The question the IPO sharpened is no longer whether satellite-to-phone is real, but who builds the winning network. The answer will come from orbit, on a schedule, over the next several years. To keep a closer eye on the launch, satellite, lunar, and space-data economy as it develops, sign up for the free Orbital Economy Signal Brief.
SIGNAL OVER NOISE
Signal over noise. Space, satellite-connectivity, and telecom headlines move fast — and the crowd often moves first. Eagle Eye is a real-time investor signal-intelligence platform that surfaces sentiment shifts, news flow, and trending tickers as they happen, so you see the move forming instead of reading about it later. See it at eagle-eye.dev.
CONTACT
Equity Insider
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SOURCES
[1] Space Exploration Technologies Corp. (SpaceX), Form S-1 registration statement and Starlink Mobile disclosures (proposed Nasdaq symbol SPCX), May–June 2026, sec.gov; contemporaneous news reporting.
[2] AST SpaceMobile, Inc. (Nasdaq: ASTS), Q4 and full-year 2025 results and business update, March 2, 2026.
[3] Globalstar, Inc. (Nasdaq: GSAT), Q1 2026 financial results, May 7, 2026.
[4] Viasat, Inc. (Nasdaq: VSAT), corporate disclosures, 2026.
[5] Starfighters Space, Inc. (NYSE American: FJET), company press releases ($17.5 million strategic investment; STARLAUNCH; Kennedy Space Center operations), 2026.
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IMPORTANT — PLEASE READ: This article is editorial commentary and was NOT paid for, requested, commissioned, reviewed, or approved by any of the companies named in it, nor by Creative Direct Marketing Group ("CDMG"). No company mentioned in this article paid for or had any involvement in its preparation or publication. The disclosures that follow are provided in the interest of full transparency regarding our broader business relationships, even though they do not apply to this specific article.
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FORWARD-LOOKING STATEMENTS: This publication contains forward-looking statements concerning the companies referenced and the commercial-space sector, including statements regarding the proposed initial public offering of Space Exploration Technologies Corp. ("SpaceX") and its reported terms, which are based on third-party reporting and SpaceX's own filings and remain subject to change until and unless finalized; product development, launch and mission timelines; contract awards and backlog; and broader market conditions. Forward-looking statements are not guarantees of future results and are subject to risks and uncertainties — including execution, regulatory, financing, competitive and macroeconomic risks — that could cause actual results to differ materially, as detailed in each referenced company's filings with the U.S. Securities and Exchange Commission at www.sec.gov. References to SpaceX are for thematic and contextual purposes only; SpaceX is a separate company with no affiliation to the publisher, and nothing herein is an offer to buy or sell, or a solicitation of any offer to buy or sell, securities of SpaceX or any other company. Figures attributed to named companies are drawn from those companies' public disclosures. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date made; the publisher undertakes no obligation to update or revise them except as required by applicable law.
Statistically, outsize stock market returns and President Donald Trump in the White House have gone hand in hand. During Trump's first, non-consecutive term, the iconic Dow Jones Industrial Average (^DJI 0.09%), benchmark S&P 500 (^GSPC 0.05%), and growth-fueled Nasdaq Composite (^IXIC 0.24%) rallied 57%, 70%, and 142%, respectively.
Several catalysts have propelled the Trump bull market, including the evolution of artificial intelligence (AI), record S&P 500 share buybacks in 2025, and initial public offering (IPO) euphoria, courtesy of Space Exploration Technologies (SpaceX)(SPCX +0.13%) and well-known large language model (LLM) developers, Anthropic and OpenAI.
President Trump delivering remarks. Image source: Official White House Photo by Andrea Hanks, courtesy of the National Archives.
Elon Musk's SpaceX went public on June 12, dethroning overseas energy goliath Saudi Aramco as the largest IPO in Wall Street's storied history. SpaceX raised $75 billion, nearly tripling Saudi Aramco's December 2019 IPO, and briefly surged to a valuation of almost $3 trillion before paring its post-IPO gains.
Meanwhile, Anthropic and OpenAI both confidentially filed for their respective IPOs with the Securities and Exchange Commission on June 1 and June 8. As of June 18, Anthropic and OpenAI were commanding estimated valuations of $965 billion and $909 billion, respectively, on secondary markets.
While IPO hype is currently thick enough to cut with a knife, newly implemented rules can very easily turn the tables and upend the Trump bull market.
Fast-entry index inclusion rules are a pending disaster for the Trump bull market In addition to SpaceX rewriting the record books with its June 12 IPO, several committees amended the rules for index inclusion prior to its debut.
In a presumed effort to court the world's largest IPO to list its shares on the Nasdaq (NDAQ +1.24%) stock exchange, Nasdaq Global Indexes announced sweeping index inclusion reforms for the Nasdaq-100 that became effective on May 1.
To be clear, this means only the S&P 500 will exclude SpaceX shortly after its IPO.
FTSE Russell adds eligible megacap IPOs after the close of the 5th trading day.
Nasdaq adds them about 15 trading days after listing.
The S&P 500 kept its rules, so SpaceX waits the full...
-- Hedgeye (@Hedgeye) June 4, 2026 Among the changes, Nasdaq Global Indexes shelved the low-float requirement and meaningfully shortened the time it takes for megacap companies to be added to the Nasdaq-100. If a newly public, non-financial company ranks in the top 40 market cap within the Nasdaq-100, it's now eligible for inclusion after only 15 trading days. Previously, eligible companies had to wait at least three months before being added to the Nasdaq-100.
On May 27, the U.S. Russell Indexes followed suit with unique index inclusion adjustments. Whereas large-cap IPOs have historically been added to the Russell 1000 and/or Russell 3000 on a quarterly basis, the new criteria allow large-scale IPOs to be added to these indexes after just five trading sessions.
In other words, SpaceX, Anthropic, and OpenAI have a path to fast entry into the Nasdaq-100, Russell 1000, and Russell 3000. While this might sound intriguing on paper, given the off-the-charts buzz for these AI superstars, it's actually a historical nightmare for Wall Street.
Moral of the story-do NOT chase hot IPOs
Year-1 average drawdown = 55%
Year-1 median drawdown = 54%
Table: Truist pic.twitter.com/xt864JD4Xh
-- Puru Saxena (@saxena_puru) June 3, 2026 Before SpaceX's debut, Truist Financial released an analysis that detailed the performance of 30 of the largest tech-based IPOs since Facebook (now Meta Platforms) went public in May 2012. Just 43% of these 30 hyped IPOs were positive six months after their debuts.
Even more notable, Truist found the average year-one drawdown for the hottest tech-driven IPOs is 55% over the previous 14 years. History has repeatedly shown that buying into hyped IPOs is often a terrible idea.
With SpaceX, Anthropic, and OpenAI eligible for fast-track inclusion into key indexes where they'll presumably have significant weighting, an average drawdown of 55% could pull the rug out from beneath the Trump bull market.
Image source: Getty Images.
But wait -- there's more On top of high-profile IPOs typically tumbling after their debuts, next-big-thing technologies have a checkered past.
Dating back to the advent and proliferation of the internet in the mid-1990s, every game-changing innovation has navigated an early innings bubble-bursting event. The reason these bubbles form and eventually burst is that investors consistently overestimate the adoption and/or optimization of an innovation.
Artificial intelligence has shown no signs of an adoption issue. Graphics processing unit kingpin Nvidia, and memory/storage companies, can't keep their AI data center products on the proverbial shelves long enough to blink. But it's a completely different story from an optimization standpoint.
When the internet went mainstream, businesses welcomed this new marketing and sales channel with open arms. However, it took companies more than half a decade before they understood how to optimize this technology to maximize sales and profits.
Even though AI hardware sales are through the roof, it'll likely take years for businesses to optimize AI solutions, including LLMs. The otherworldly growth expectations built in for SpaceX, Anthropic, OpenAI, and a laundry list of prominent AI-driven companies are unlikely to be met, based on what history tells us.
This combination of reshuffled index inclusion criteria, the historically abysmal performance of high-profile IPOs, and the propensity for bubbles to form with game-changing technologies bodes poorly for the Trump bull market.
Space Exploration Technologies (SPCX +0.13%), led by innovative founder Elon Musk, has wowed investors with its position in the exciting spaces of rocket launches, connectivity, and artificial intelligence (AI). And thanks to SpaceX's recent initial public offering, investors have the opportunity to get in on this growth story.
The industrial and tech giant launched a record operation earlier this month, raising more than $85 billion after an overallotment option in what is now the world's biggest IPO. And the stock has climbed in the double digits from its IPO price of $135. Musk says the company has reached an important growth phase -- and he even completed a $25 billion bond sale in recent days to raise additional funds.
Now, whether you're a SpaceX shareholder or considering a position in the stock, you might be wondering what's next for the stock price after the recent positive debut. Where will SpaceX's price be in September? Let's check out what the options market says.
Image source: Getty Images.
Three game-changing growth areas First, let's catch up quickly on the SpaceX story so far and the details of the recent IPO. As mentioned, the company operates in three game-changing growth areas. And what's compelling is that SpaceX's advancements in one area may boost its other businesses. For example, its reusable rocket technology will make it cheaper for the satellite-based internet business to send satellites into space.
SpaceX has made important progress in certain areas, such as bringing down the cost of rocket launches by using its reusable technologies and bringing internet services to customers anywhere through its connectivity business. But many of SpaceX's goals are yet to be accomplished and still require significant investment. The AI business is particularly spending-intensive, with capital spending reaching $12 billion last year -- that drove the entire company to a loss of $4.9 billion.
Since SpaceX is so innovative and must develop its technology to realize many of its dreams -- like putting data centers into orbit -- this spending may be far from over. And this means lasting profitability probably isn't right around the corner. So, though SpaceX is an interesting and exciting company, it involves a certain amount of risk.
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SpaceX's record IPO Many growth investors, however, accepted this risk and rushed to get in on the stock -- during the IPO and after. The IPO, with about 20% of shares earmarked for retail investors, was heavily oversubscribed, and as mentioned above, the stock soared right out of the gate. Underwriters also exercised an overallotment option in the days following the operation, and that increased the funds raised from the initial IPO level of $75 billion.
So it's clear that there's been a lot of interest in this operation and in the stock in its early days on the market. Still, some analysts and investors have questioned the stock's valuation considering its current financial picture. Morningstar, for example, in a note right before the IPO, gave SpaceX a fair value estimate of $63, less than half the offer price.
And today, SpaceX trades for more than 100x sales, which seems considerably high.
SPCX PS Ratio (Annual) data by YCharts
Will SpaceX stock continue to rise? So, it's reasonable to wonder whether the stock's explosive gains will continue. Now, let's consider what the options market is showing. This is where investors buy contracts that allow them to bet on whether a particular stock will rise or fall during a given time frame. A call option, considered bullish, offers the holder the right to buy a certain stock at a set price, while a put option, considered bearish, offers the holder the right to sell at a set price.
Options activity shows a 40% probability of SpaceX stock falling below $130 by the middle of September, Reuters reported this week, citing Susquehanna Financial Group strategist Christopher Jacobson. If this happens, IPO investors may see a loss of at least 3.7%.
Though options still are leaning in a bullish direction, the 40% I mentioned above is high enough to suggest investors might want to proceed with caution. SpaceX is a fascinating company and may eventually reach its goals, but today, valuation and risk are both high -- and these elements could weigh on stock performance in the months to come.
Space Exploration Technologies (SPCX +0.13%) might be the hottest stock on Wall Street right now. It completed the largest IPO in history about two weeks ago and even briefly became the fifth-largest corporation on the market. Many investors are excited about SpaceX's outlook, given its aggressive vision for a multiplanetary future, as well as its work in broadband internet services and artificial intelligence, the latter of which represents the largest addressable market worth tens of trillions of dollars, according to the company. However, there are good reasons to be skeptical of SpaceX right now. Let's discuss two of them and consider an alternative investment strategy.
Image source: The Motley Fool.
1. The valuation is hard to justify SpaceX's stock has declined over the past few days, but the company is still worth about $2 trillion. It's not too hard to understand why: If SpaceX can make significant headway into its addressable opportunities -- and is actually right about the size of the markets it is tapping into -- it could deliver impressive returns. The only problem is that, for now, SpaceX's financial results hardly justify its market value. In 2025, the company posted revenue of $18.7 billion, up 33% year over year. It also recorded a net loss of $4.9 billion, far worse than the $791 million in net income it reported in 2024. SpaceX significantly trails other tech leaders with a market cap of $2 trillion or more in both categories.
NVDA Revenue (Annual) data by YCharts
Further, some of them are also tapping into the massive AI market SpaceX is targeting, so it's not like the company will have an unobstructed path to the top of this industry. In short, even if SpaceX's ventures look somewhat promising, at its current levels, it could be a wealth destroyer -- rather than a wealth compounder -- over the next few years.
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2. It is exposed to significant political risk SpaceX does a lot of business with the U.S. federal government, which accounted for about 20% of the company's revenue last year. On the one hand, that grants the company a predictable source of revenue. However, it also creates potential problems for SpaceX. New administrations can shift priorities and reduce budgets typically dedicated to space travel, which would harm the company's business. This risk is especially pronounced considering Elon Musk, a rather divisive political figure, is the CEO of SpaceX. The company is benefiting from government contracts now, but that could change quickly, which is another reason to be skeptical of SpaceX's prospects.
There are safer ways to invest in the space economy than buying shares of SpaceX. For instance, it's worth considering the Procure Space ETF or the Tema Space Innovators ETF, both of which provide exposure to leading companies in the space industry, including SpaceX. So, these ETFs can help investors capitalize on the growing space industry while reducing the significant risk associated with SpaceX.
Prosper Junior Bakiny has positions in Alphabet, Amazon, and Nvidia. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Microsoft, and Nvidia. The Motley Fool has a disclosure policy.
Space Exploration Technologies (SPCX +0.13%), also known as SpaceX, went public on June 12, and it has taken early investors on a roller-coaster ride. Depending on when you got in, you could be sitting on solid gains or a hefty loss.
Successful investing is a long-term endeavor, so it's important not to overreact to what happens over a week, month, or even a year. Ideally, you should plan to hold stocks you buy for at least five years. That said, SpaceX has become one of the largest public companies in the world, so now's a good time to see how it has done over its first few weeks on the market.
Image source: Getty Images.
An extremely volatile two weeks The SpaceX IPO was priced at $135. For anyone who didn't get IPO shares, it opened at $150 on June 12. It trades at $154 as of June 24. But that modest gain is the result of a wild round trip.
SpaceX lived up to the hype over its first three trading days, peaking at about $226 on June 16, a 50% increase from its first-day open. It was even the world's fourth-largest company at one point, ahead of Amazon and Microsoft.
However, SpaceX gradually declined over the rest of the week, closing at $185 on Friday, June 19. SpaceX stock then plummeted on Monday, June 22, closing at $155. Despite some ups and downs, it has mostly been flat since then.
SpaceX's stock was up 50% at its peak, then it fell 32%. You rarely see that kind of volatility in a megacap stock, but there's a simple explanation.
Why has SpaceX been so volatile? The biggest factor driving SpaceX's volatility is its tiny float. Only 4.2% of SpaceX shares are publicly traded after its IPO, while the remaining 95.8% are held by insiders who are in their lockup period and can't sell yet.
Publicly traded companies typically have much higher floats. Most stocks on the major indexes have floats of at least 80%. A small float magnifies price movements. Surges in interest shortly after the IPO can cause substantial price increases. Any negative news can stop the momentum and unleash a rapid drop instead.
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The news that seems to have driven SpaceX's recent decline is the June 22 announcement that it had raised $25 billion in debt through a bond offering. It's using the proceeds to pay off a $20 billion bridge loan for the acquisition of xAI, which is reasonable enough, but raising more money after it just made $75 billion from its IPO worried some investors.
SpaceX's float will gradually increase, as its lockup period has staggered selling windows. In each selling window, a percentage of insider shares unlocks and can be sold on the public market. The final selling window is 180 days after the IPO.
Investors should expect heightened volatility until the lockup period ends in December. Even after that, SpaceX will be a high-risk investment that goes through significant price swings, as space and AI, the company's core businesses, are both volatile industries.
While there's a lot to like about SpaceX, you may want to hold off on investing until the price comes down or the lockup period ends.
Item 1 of 2 SpaceX leadership members and guests celebrate on a balcony at the Nasdaq MarketSite on the day of SpaceX's initial public offering (IPO), in New York City, U.S., June 12, 2026. REUTERS/Brendan McDermid//File Photo
[1/2]SpaceX leadership members and guests celebrate on a balcony at the Nasdaq MarketSite on the day of SpaceX's initial public offering (IPO), in New York City, U.S., June 12, 2026. REUTERS/Brendan... Purchase Licensing Rights, opens new tab Read more
June 26 (Reuters) - SpaceX (SPCX.O), opens new tab will be added to the tech-heavy Nasdaq 100 index on July 7, exchange operator Nasdaq confirmed on Friday, paving the way for a surge in passive investments in Elon Musk's rocket and AI giant.
Inclusion in the index typically boosts the stock price, as exchange-traded funds looking to replicate the index's performance buy shares of the newly included firm.
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To make it more attractive for companies seeking U.S. listings, Nasdaq, along with other index providers FTSE Russell (LSEG.L), opens new tab and MSCI (MSCI.N), opens new tab, relaxed its entry requirements including profitability, the number of days after a company goes public and the number of shares available for trading.
SpaceX, which made its Nasdaq debut on June 12, has swung between sharp losses and small profits over the past three years. Last year, the company reported a net loss of $4.9 billion.
SpaceX's revenue climbs, losses deepenLarge Language Model (LLM) makers OpenAI and Anthropic are also expected to file for their initial public offerings this year or next year and likely target valuations of more than $1 trillion.
Investors buy mutual funds and ETFs, such as Invesco's QQQ (QQQ.O), opens new tab and QQQM (QQQM.O), opens new tab, that track the Nasdaq 100, to get broader exposure.
J.P. Morgan estimated that SpaceX's inclusion in the Nasdaq 100 could draw $4.3 billion in passive inflows.
"Clearly, there's a lot of demand, that's why they fast-tracked the integration into the index," Michael Field, chief equity market strategist at Morningstar, said. "A lot of people will be happy with it. Some fund managers less so, the skeptics amongst them, us included. We think the stock is overvalued."
S&P Global (SPGI.N), opens new tab said this month that it was not changing the requirements for SpaceX to enter its major indices, including Wall Street's benchmark S&P 500 index (.SPX), opens new tab, (.INX), opens new tab, and will wait for at least 12 months before even considering it.
Reporting by Johann M Cherian in Bengaluru; Editing by Shinjini Ganguli and Will Dunham
Our Standards: The Thomson Reuters Trust Principles., opens new tab
SpaceX became one of the quickest additions ever to the Nasdaq-100 index, setting up a fresh wave of buying from passive investors less than a month after the company's blockbuster public debut.
Nasdaq announced after the close Friday whether SpaceX qualifies for inclusion in the benchmark technology index. Assuming the company meets the requirements, index-tracking funds and other product sponsors would begin purchasing shares after the market closes on July 6, with SpaceX officially joining the Nasdaq-100 before trading begins on July 7.
More than $800 billion tracks the index, including the Invesco QQQ Trust (QQQ), which is one of the most popular securities traded each day and is seen as a barometer for the artificial intelligence bull market.
The aerospace and satellite company is expected to enter the index with a weighting of less than 1%.
Adding SpaceX this quickly would make the Elon Musk company one of the first beneficiaries of Nasdaq's recently adopted fast-track inclusion framework for newly public companies. The changes allow some large IPOs to become eligible for the Nasdaq-100 after just 15 trading days, dramatically shortening what had historically been a far longer waiting period.
Under the previous framework, investors tracking the Nasdaq-100 could be forced to wait months before gaining exposure to newly listed market giants.
The inclusion could create another source of demand for SpaceX, which has been one of the most actively traded stocks since its June 12 debut. Index funds and exchange-traded funds tied to the Nasdaq-100 would need to buy shares to match the benchmark's new composition, while active managers who track the index closely might also adjust positions.
Because SpaceX's publicly tradable float remains small compared with its total market capitalization, even a modest index weighting could require meaningful purchases from passive investment vehicles.
Earlier this month, S&P Dow Jones Indices declined to create a similar fast-track process for the S&P 500. Therefore, SpaceX remains ineligible for inclusion in the S&P 500 because of that index's separate profitability and seasoning requirements.
Image Credits:Spencer Platt / Getty Images Elon Musk is eyeing an acquisition of Mesh Optical Technologies, a startup founded by three former SpaceX engineers last year developing hardware for fast data center communications.
The potential acquisition, which was revealed in a Federal Trade Commission filing and first reported by Bloomberg, confirmed the agency expedited its antitrust review.
Mesh Optical came out of stealth in February when it announced that it raised a $50 million Series A led by Thrive Capital.
Before founding Mesh Optical, the startup’s co-founders, Travis Brashears, Cameron Ramos, and Serena Grown-Haeberli, developed the optical communication links that keep thousands of SpaceX’s Starlink satellites interconnected.
The Mesh co-founders saw an opportunity to develop optical transceivers for terrestrial data centers, as light-based hardware is faster and more energy-efficient than traditional electrical-based systems.
SpaceX has recently entered into agreements with Anthropic, Google, and the open-source AI developer Reflection AI to provide them with compute capacity at its data centers, generating a substantial new revenue stream for the newly public company. Acquiring Mesh could eventually allow SpaceX to improve the efficiency of its data centers, whether they are located on Earth or, in the future, in space.
In this episode of Motley Fool Hidden Gems Investing, Motley Fool contributors Travis Hoium and Lou Whiteman along with Motley Fool analyst Emily Flippen discuss:
Robinhood and Rivian layoffs.Are layoffs backfiring?Fox buys Roku, but why?SpaceX buys Cursor.World Cup of investing.Stocks on our radar.To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. When you're ready to invest, check out this top 10 list of stocks to buy.
A full transcript is below.
This podcast was recorded on June 19, 2026.
Travis Hoium: Is there a new problem with the layoffs in tech? Motley Fool Hidden Gems Investing starts now. Welcome to Motley Fool Hidden Gems Investing. I’m Travis Hoium, joined today by Lou Whiteman and Emily Flippen, and we are going to get to the hot topic of the day. That's the SpaceX IPO and the acquisition of Cursor that was officially announced this week.
But, Emily, I wanted to start with some of the layoff news around the market, around technology companies. We had Rivian announce some layoffs this week; we had Robinhood announce layoffs. The other big thing is Meta's layoffs, which was, I think, 8,000 people over the past couple of weeks, a rolling layoff that seems to be hitting their culture. Now, we're investors, and so we're looking at this from an investment standpoint. Typically, layoffs have been cheered over the past few years because it's cost-cutting, companies are going to be more profitable. But it seems like, especially at a company like Meta, we're starting to see the downside that, hey, if that comes at the cost of your culture and people actually wanting to work for you long term, maybe this isn't the right strategy. How in the world should we think about some of these layoffs as they're announced?
Emily Flippen: I'm just feeling shocked that Meta is still claiming to have a culture after all these years, with the number of directions that Zuckerberg has taken that company. I'm shocked that anybody at the company still feels like there's a cohesive culture. I understand the complaints there, but there's no doubt that layoffs, of course, reduce morale across the board. Nobody likes to see their friends, their co-workers, leave the company; nobody likes to feel like their own livelihood is threatened. But what I think is really interesting dynamic is that, to your point, this is really only a recent development, the idea of layoffs being cheered. I mean, prior to 2022, the market really didn't like layoffs. It usually meant a slower economy, less people employed. But after this pandemic, the narrative has really shifted. I think the narrative has become layoffs, Duce off lower inflation, which of course, everybody is concerned about. They also boost earnings, even temporarily, for a company. That’s all coming after what many perceive to be over-hiring that took place during and post-pandemic throughout 2020-2021.
There's actually been some research about this that I think is really interesting and reactions do, of course, and should, significantly change from company to company. But on average, layoff announcements do tend to be followed by poor stock returns for the companies that announce layoffs, and I think that, yes, culture has a part to do with that, Travis, but it might be interestingly enough, just that layoffs actually really produce less cost savings than a lot of people assume. They have the moment of being like, oh, maybe we're going to see a bump in EPS next quarter, but then it's followed by months and years of bad feelings.
Lou Whiteman: [OVERLAPPING]
Emily Flippen: Exactly.
Travis Hoium: Lou, it does seem like one of these things that's really new is, hey, we're announcing layoffs, but we're doing it from a position of strength, and that's supposed to be, it's the buzzword. That was what Robinhood said this week. Hey, we don't really want to do this, but we have a great business, a great balance sheet, lots of profits and we want to make sure that I don't know, we're getting ahead of what could be coming down the pipeline, it seems like an odd position.
Lou Whiteman: It is, I'm going to state the obvious here, but I think it needs to be stated because of some of what the companies say. Layoffs happen for a reason, and that reason normally isn't good. Sometimes an external reason, sometimes internal, you can make the case that right now it's happening because AI gives them cover, maybe. It might not be a warning sign, but there are very few CEOs out there who are going to just do layoffs for fun. If you were cutting people, it's probably because you see something. As Emily said, the reaction is relatively new, and it's far from universal. Just this week, we've had, companies doing layoffs where some it was cheered and some it wasn't, so it's not a universal thing.
Here’s the thing, though, at the end of the day, the market is always forward-looking. Layoffs, I take as a sign that things aren't going as well in this moment as they could be. But since I'm trying to invest in the future, the question is, is that does this position the company for success in the future? Rivian is one we talked about earlier in the week. Rivian, things are not going well today and they are doing layoffs because they need to save cash. But if they work, it could make them a better investment, so it's very nuanced. We never invest or we hardly ever invest on just the conditions today, we are always trying to take a look in the future. A CEO's job is to try to position their company to succeed in the future. Layoffs can be a part of that, so they can be a long-term positive, but they certainly aren’t just layoffs, so stock goes up or layoffs are fun, something like that. It is a sign that something isn't going to script.
Emily Flippen: Always drives me insane about this narrative is when companies say that we're laying off from a position of strength. What is that? If you actually look at the data for companies, the most expensive thing that a company can do is hire somebody. The resources, the time, and the literal money that is spent to bring a single full-time employee into the company’s universe, that is an expensive decision. What you're telling me when you laid off is that you made a lot of really bad decisions in the past. I care less about what that means for next quarter's earnings and much more about what it means for your ability to allocate resources effectively.
Travis Hoium: There always seems to be this narrative, too, that companies can easily pick out the top performers and the bottom performers. Lou, you probably remember, Jack Welch, what was it? Cut the bottom 10% every year, and that's a really easy thing to say, when you actually get into a company, the CEO, the vice president who is making these decisions. I've been in big companies as these have happened. They don’t really know what an entry-level person is doing, and who is a phenomenal engineer, and who just got put on a really bad project. It also seems like there's a level of randomness to it. If you are taking away from that long-term culture that you've been building, I'm going to pick on Robinhood here, but Robinhood has been a phenomenal growth business over the past few years, even since it started. If you start eroding that, like maybe Meta has over the past few years, Lou, that seems like a poor trade-off, short-term versus long-term.
Lou Whiteman: It is, but I mean, look, at the end of the day, Emily's right. If you overhired in the first place, shame on you, but you probably need to do something about it. But again, I don't think, no matter how they spin it, any CEO says layoffs are a good idea. I can think of one CEO who danced on stage after doing layoffs, but it wasn't his company, so I'm not going to even put that in there. It's a cautionary tale, but I think it's something CEOs already know, whether it's layoffs, buyouts, anything, these survivors are maybe looking over their shoulder a little. You've lost a friend, you've lost the person you eat lunch with. There's a lot of reasons why things can go even among the remainders, you have a net negative. Companies, again, if you want to signal as an investor, nobody goes through this if there isn't something else going on. I think the best signal is that, there's probably a reason if this press release came out.
Travis Hoium: Let's go to one of the interesting merger and acquisition items for the week. That is Roku being acquired by Fox. Emily, one of the things that was interesting as we got more news about this. I think it's fascinating that Fox is buying a tech company, and I think we can debate whether this is a great move or not, but there is also other potential buyers like Netflix, who are at least sniffing around this deal. It seems like Roku is a bit of a hot commodity despite being a dud for investors for quite a while here.
Emily Flippen: Hot commodity up until they made their decision to move to Fox. To be honest, I'm probably the worst person to talk to about this because I am not lacking emotion when it comes to this company. I'm a big fan of Roku. I've been a Roku shareholder and a big believer in really what has been happening in terms of the turnaround, especially as it relates to their ad business in recent quarters. I was incredibly shocked and disappointed to see the news that Roku was opening itself up for acquisitions here. I don't see the logic in my opinion, from Roku's perspective, but I do think it's a boon to whoever, in this case, Fox could purchase them. Roku's business has been massively turning around as they improve their ad stack. It seems like, in my opinion, founder and CEO Anthony Wood just wanted to free up time. That's the best guess I can get for why he would pursue this deal. He does own 55% of the voting shares for the company. The deal has already been approved by both boards. It seems like virtually nothing except for regulators, which I doubt will do anything,
could step in to stop this deal. Again, I can't rationalize this for Roku. Companies are still when I saw the deal announced, I saw articles from CNBC and others that were still referring to Roku as a streaming device hardware maker. Like, they don't understand the business at all. There's been this fundamental misunderstanding from investors about what Roku is and could be for the future. Fox is getting a good deal here, in my opinion, I think Roku shareholders like myself, are getting a bit of a dud deal, but you're right, share prices coming out of the pandemic have been obviously depressed for Roku for many years now, despite the fact that its business has performed strong. Don't understand the logic of combining with this legacy cable media business. Roku shareholders will own just under 30% of the combined company, so it won't be nominal to Fox's results, but you have to hope that Fox doesn't ruin the asset that they just purchased because part of the value of Roku was the fact that it was the only connected TV independent platform provider, and that will no longer be the case after this acquisition goes through.
Lou Whiteman: Emily is going to be disappointed to find out that I disable Roku as quickly as I can when I buy a TV because I just want my Apple TV to work.
Travis Hoium: You see, I'm the other way. I have a Roku stick working on Amazon Fire TV. I love it. But look, Emily, I'm going to try it, I don't know if this will pass the Emily Flippen smell test, but I will try to explain it. I don't know if I believe this, but this is my best guess.
Emily Flippen: Please convince me.
Travis Hoium: Well, we'll see about that. I think for the Fox side, it just confirms existing narratives. It's another reminder that traditional cable and television businesses are on the decline, and you need to jump onto a lifeboat, that's feature looking. I do think that that sort of works from that side. It is harder to figure on Roku, but I think it's possibly that they looked at that hardware business. I know it's not just a hardware company, but you need those boxes to get all of that add tech goodness. At the end of the day, you have to have those boxes out.
Emily Flippen: To be clear, it's not boxes, it's the actual TV itself.
Travis Hoium: Well, I know, but you have a lot of competition here, that's what I mean.
Emily Flippen: They have more market share than the next three competitors combined. They're killing it. Their market share has only gained since the company went public.
Travis Hoium: They do, but you also have Walmart in the game. You have Alphabet.
Emily Flippen: In their market share.
Travis Hoium: But what are they seeing that we haven't other thing is, too, and this is what I'm more thinking about. I always complain about how I can't switch channels the way I used to. If I want to watch two games and one's on Peacock and one's on Paramount, it's like a 10-minute process, and the future stinks versus the. The way I think that they're beginning to solve this is is that I have YouTube TV. YouTube TV is now integrating Peacock into that, and they're beginning to integrate ESPN and all of these things in it. I think we are getting back to the future where imagine just turning on your screen, and you just have basically go to the channel you want, you're living inside maybe the YouTube ecosystem.
I think there's a lot of ways where the future doesn't look better for Roku between these big-pocketed other systems and just bypassing it together. I think maybe that's what they're seeing, but otherwise, I don't have a clue. This is just of I'm dream casting the future I'd like to see, I think. It seems like everybody involved here does need to bring scale to the market. Whether you're Fox looking at advertising and competing at companies like Amazon now, or whether you're Roku going, hey, we've got a nice advertising business. It's growing, but it is absolutely nothing compared to all these other platforms, and that's something that advertisers think about. When we come back, we are going to get to the big news of the week that comes from SpaceX once again. You're listening to Motley Fool Hidden Gems Investing.
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Travis Hoium: Welcome back to Motley Fool Hidden Gems Investing. We know SpaceX, the newly public company that is controlled by Elon Musk as a space company. But this week, they finalized an agreement that is going to make it more of what it actually is, which is an AI company, Lou, buying Cursor for $60 billion. This is a deal that was pre-announced before the IPO, but we actually got the details, and it’s interesting that this is a huge acquisition, really finalized less than a week after going public.
Lou Whiteman: It was finalized before, basically, but they didn't want to have to go back and rip up the S1 and slow the process. This is just them doing what they want to do, whether or not it works. Look, I read the S1 and I still don't really know what the SpaceX AI business is. Can I admit that? Maybe I have reading problems, but {OVERLAPPING]
Travis Hoium: It does seem like one of those things where it can be whatever you want it to be as an investor, which.
Lou Whiteman: It was everything.
Travis Hoium: It’s a Neo Cloud, it's a model maker.
Lou Whiteman: Let's be honest, that is the only way you get a total but addressable market basically equal to U.S. GDP is to make it everything. But I do think at some point, they are going to have to narrow down exactly what they want to do with AI. I don't think the bull case is Grok is going to just whoop Cloud. I'm not even sure they're even trying with Grok anymore. If I'm honest with you, the way they're farming out data centers, things like that. The way I see it, though, Musk has a blank canvas with AI here, and he's got a big checkbook in which to spend. The idea now is to find a way to build value with AI and justify the valuation. Cursor feels like a step in that direction. I think, if anything, looking at this, I would expect it not to be the only step or the first step. I think they'll probably do more of this. Look, it's really hard to look at this business because the way we're looking at the AI business from xAI that we saw six months a year ago. But I think what will actually emerge, either good or bad is something very different that is still just now coming into focus internally and we don't have a clue what it looks like extern.
Emily Flippen: That's fair, Lou. I agree $60 billion, it's so much money, I don't want to say that it's not. SpaceX only raised around $85 billion through its public offering for context. It's not nothing, but it is just a drop in the bucket when we're talking about the valuation that is being attached to both xAI and SpaceX itself, given the fact that it has a market cap north of $2.5 trillion. It really doesn't actually move the acquisition itself, doesn't move the needle much for the company. This you only get to $2.5 trillion valuation by selling potential. That potential for AI includes things like data centers and space, which I've had way more conversations in the past two weeks of my life about data centers in space than I ever expected to if you had asked me just a handful of years ago.
But that is what's driving the perception of value. While I recognize that XAI looks bad, today, it looks lagging behind. Financially, it looks challenged, but I love to play devil's advocate. I can't help myself here, it's hard to SpaceX sometimes in its valuation, but I do think the biggest mistake investors make with this company and AI in general is that presuming that what is true today will be true tomorrow. A year ago, Grok's chat market share was less than 2% today. It's nearly 20, if you look at Google, it launched Bard and it was ridiculed for that. Then that has evolved into Gemini, which, in my opinion, is excellent. Same with Microsoft, and it's OpenAI. They struggle as Copilot, but now GitHub Copilot is dominating. The industry is moving fast, we shouldn't extrapolate what exists today as if that's always going to be the case for the future. But I do think to your point, Lou, they're using these resources to try to build the future AI business that is needed to justify today's price.
Travis Hoium: Emily, just a little pushback on that because it does seem like the Grok app and using that the way that you would use something like Gemini or Cloud is maybe not exactly the same. I assume a lot of that usage that you're talking about is people on Twitter going, hey, Grok, is this true or answer this question for me? It's always funny when you see a popular thread. There's 15 questions for Grok in that thread, so I assume that's a lot of that usage. But that isn't necessarily monetizable in the same way that it would be for paying a subscription fee for a cloud or something like that. Doesn't it seem like that's part of the challenge here is what's the actual use cases? What are people actually going to pay for it? At least Cursor brings something in-house that is a growing business, whether or not that has a mode around it with Grok now, in-house is maybe a bigger question, but is that at least part of the theory?
Emily Flippen: I was really hoping you just wouldn't push back on me there, Travis. Just take my market share data at face value and let's move on. You're certainly right as Grok has been rolled out, it's been rolled out in avenues for accessibility that are not directly being monetized right now. Twitter is a big one X, as well as obviously, Tesla vehicles themselves. Now, there's always an opportunity to put in subscription fees, that thing. But I do think the opportunity with AI. It's not monetizable, it's not a unique Grok problem. It's a challenge that all of these chatbots are experiencing. I think ultimately it comes down to the idea ever going to get from the consumer market, what you could get from the enterprise market. I think it becomes less, how do I get a user on X to pay for this and more, how do I get this where the real money is with the enterprises that are driving the vast majority of AI usage. It is a challenge Cursor is certainly a step in the right direction.
Travis Hoium: Lou, does this at least give some relevance to the addressable market that they talked about?
Lou Whiteman: Enterprise is what it is. What is their enterprise business, though? What I still look like it's Cursor. Is it, I guess, is that worth $27 trillion? We'll see.
Travis Hoium: The market thinks it does right now. When we come back, we’re going to play a World Cup-style game with investing. You're listening to Motley Fool Hidden Gems Investing.
Welcome back to Motley Fool Hidden Gems Investing. We like to have a little bit of fun with investing in this segment, and we're going to play a World Cup-style game where we're going to have companies from around the world battle to see who is the ultimate champion. We've got a group of South American companies, European companies, Asian companies, and companies from the Americas. Lou, you have the first group from South America. We have Petrobras versus MercadoLibre. Who takes the championship there?
Lou Whiteman: This reminds me of an actual game we saw played in this World Cup. This is Morocco versus Brazil, where one of them is just the established Titan, and one of them is the plucky upstart, and they ended up playing to a draw, but we won’t do that here. The Petrobras is South America's largest energy company, they are the old school, the classic Titan, MercadoLibre didn't even exist when Petrobras was at its heyday, which you say about the Brazilian soccer team these days, too, I think. But it is the new up-and-comer, and I think MercadoLibre is the winner here. They are emerging as South America's champion. Who knows what's going to go on with them with their lending business? It is, if nothing else, I think, a speed bump. It's hard to do lending, especially at first. You need to adjust. But, Petro Boss, hopefully, we're getting back to normal in the Middle East, and I don't think maybe their momentum is going to carry. I'm going to go with MercadoLibre.
Travis Hoium: Emily, you are looking at Europe. We have ASML from the Netherlands versus Spotify.
Emily Flippen: I think both of these companies are probably upset they're going against each other in the first round here because I think they'd both rather go against the state-controlled oil giant. They're both incredible monsters in this bracket. ASML obviously the largest between the two market cap north of $700 billion; that's all because they have effectively a monopoly on EUV lithography, which is the only tool right now that can make the leading-edge AI chips that are needed to drive, I don't know, everything that we're seeing in the market today. It's really hard to go up against ASML, but I think Spotify is holding its own in this matchup. It's a beloved consumer story. It's a company that I think has a little bit of the underdog effect. Everybody said the gross margins will never get north of 30% because of the way that they have their contract and license set up with record labels, and that's true. Part of their business, but Spotify has said, Hold my World Cup beer here because there's so many different ways that we can pivot with the average consumer to monetize them more deeply.
I am unfortunately or fortunately, depending on which side of the side you're on, one of those consumers that is now paying extra on top of my Spotify membership every month to access things like audiobooks. While I do love Spotify, and I think that it's underappreciated, how do you beat ASML? I recognize they're getting a lot of the near-term benefit here as they sell these EUV machines, but the world that we're seeing today cannot operate without it. I think that level of market dominance is just hard to compete with. I have to give the edge to ASML, but let's say it's a close match.
Travis Hoium: I swear you must have had Spotify leading this entire match and then coming from behind ASML, because with that argument, I thought Spotify was going to come out ahead.
Lou Whiteman: I'm saying be honest, though, Sweden and Netherlands, that's a good match too. I'd pay to watch that once. I like it.
Travis Hoium: Emily, I'm going to stick with you. Let's turn our attention to Asia, Samsung versus Tencent.
Emily Flippen: Another really close match in my book. Samsung, obviously based out of South Korea, they're the cheap giant here. They're in the global Top 10, or at least we're in the global Top 10 in terms of market cap size, and a lot of that's being driven by the memory shortage that we're seeing right now that's driving prices up significantly. They're still chasing market share from the South Korean company Hynix and hide bandwidth memory. Hynix does hold the majority market share there, but it is incredible how much the operating profit has grown. Last quarter, I think it grew something like north of 700%, again, all driven by the same things that's driving ASML up today.
But Tencent is not to be underappreciated. I think it's a really quality business. This Chinese business owns WeChat, Weixin, has billions. That's billions with a B of monthly users and revenue that is still managing to grow in the double digits. I come down to what can the market not operate without? While I do think that Samsung is absurdly cheap, it's mining cash, but I also think it's a really cyclical business. Most virtually north of 90%, all of the profits here drive on this one commodity on memory. I think the mote that Tencent has built with its everything app, how integral it is to life in China and has been for years now is the one that advances in my book.
Travis Hoium: This is exactly like the World Cup because all of these companies, I know them as stocks, but I have never used any of their products. I've never bought an ASML machine. I have never shopped with MercadoLibre. I've never used a Tencent product. This just watching the World Cup and going, oh, my God, these players from Brazil are amazing, or the Netherlands, who I never see on my TV.
Emily Flippen: Well, hearing you say that makes me feel God, maybe Samsung should have won because you couldn't include Samsung.
Travis Hoium: I at least know them. Well, these two companies, I have used their products. Lou, you have America's Alphabet versus Nvidia.
Lou Whiteman: Quick shout out first to our colleague Jim Gillies and acknowledged that, yes, we could have put Enbridge, Brookfield, even TD Bank. There's a lot of good companies in Canada, but, yes, we are going with two U.S. companies here in North America, what a match up. This is like France versus Portugal. France is probably the deepest team in the tournament, all over the place. They can hit you from everywhere versus Portugal, who's best known right now for that one shining star, Ronaldo, but actually has a lot more depth than we give it credit for.
That's what I see with Nvidia. Both of them have held trophies up. They're both really, really great companies. At the end of the day, though, France usually wins this matchup because of their depth, because of their ways to win. Alphabet, we've been joking about this, but Alphabet is the cheat code for everything investing right now. You want autonomous, how about Alphabet? You want AI? Well, there's Alphabet, even chipmaking. Hey, you ever think of Alphabet, Internet search, maybe even programmatic advertising. Who knows? Get back to that in one day. Alphabet's going to win here in one of these all-time classics. Our grandparents will be talking about what a wonderful matchup that was and dreaming back to that day when they took the field against each other.
Travis Hoium: I like how my Easy Button in AI has caught on with you, Lou, so I still think that is the easy button in AI. We have now MercadoLibre versus ASML to go to the final. Emily, I'm going to start with you. Which one of these companies is going to win, and then I'll be the tiebreaker if we need one.
Emily Flippen: This comes down to, who is the judge standing on the sideline here and how are they making these calls? Because this is a really formidable match-up, and if I’m the judge on the sideline and closely examining, I don’t know too much about soccer or football, as I should say. But judging whether or not there's been any out of bounds plays, any penalty kicks here, will say, I think MercadoLibre does quietly as the underdog maybe pull ahead here and that's because the same challenge that I think Samsung has ASML has, it can be a bit of a cyclical business. They're selling EUV machines that are worth hundreds of millions of dollars. There's large purchase contracts. While they done an incredible job of maintaining that, that can lead to a bit of lack of predictability, cyclicality. There's also the issue that a lot of these restrictions that the U.S. government and foreign countries have put on China has forced innovation within China itself, so they're in the process of trying to develop a competitor to ASML, whereas MercadoLibre has proven time and time again, there is no second in command. There can be no second in command. They go back to when C Limited tried to expand the Shape out across South America and failed miserably, no fence, C Limited.
But MercadoLibre is turning this flywheel effect from its ecommerce business into a financial powerhouse. Lou is right that there's risk associated with that financing business and I think it's one worth watching carefully. But the reason why that financing business is so important is because they're effectively working as a pseudo government agency in the countries in which they operate operate providing banking services where nobody else is, and they're doing so in really volatile times while also still growing their operating profit at record rates. It is just such a high-quality fintech business today that I think they score.
Lou Whiteman: This is the classic the young athletic team that might make some mistakes, but they can run all over the field versus just a strong fundamental team, solid in defense, not going to make a lot of errors. MercadoLibre looks flashy at times and I think we're wondering, but can they keep it going? At the end of the day, I think they do, and I think the cyclicality to make it a business thing instead of just soccer, Emily's spot on there, that ASML, just with the cyclicality, MercadoLibre is going to make more mistakes. They probably give up an own goal somewhere, but at the end of the day, they are the winner over 90 minutes, which is a long time if you have ever tried to run around that long.
Travis Hoium: To bring some analytics to this discussion, I think it's fascinating to look at ASML. I think David Gardner called it one of those companies that passes the SNAP test. If they disappear, a lot of the world changes very, very quickly. But they've only grown revenue at a 12.6% compound annual growth rate over the past five years. You look at MercadoLibre, that growth rate is 35.1%. MercadoLibre is the growth story, so I'm not surprised that it wins this battle. Lou, you're up first. We have Tencent versus Alphabet. Who do you have winning that one?
Lou Whiteman: This is a classic, too. To me, though, again, I hate rooting for France in these tournaments because it is so boring. But at the end of the day, you know France is going to look real good, and the other day against Senegal, they just looked so good. Alphabet, I almost hate rooting for them here, and it's almost like it's the boring choice. But boring wins for me. Alphabet is just, again, exposed to so many areas where we look like we're in the early stages of really interesting growth. They only need to get some of the things right. The depth they have on their bench, their just ability, if one thing isn't working to lean into another. Tencent is a great company, but Alphabet, I think they win here.
Emily Flippen: I will say, it doesn't seem like we're going to need your tie-breaking here, Travis. It's an unfair match-up because Tencent, I said, it's a quality company, pretty well diversified, but they're isolating their own AI losses here across a really profitable legacy business. When I compare the environment in China versus United States, I'll be seen so much incredible innovation in AI come out of China. I do not want to discount that. There are also more rules and regulations for the companies that are trying to develop models in that country than there are here in the United States, despite all the concerns we've had about the lack of access to mythos and tropics models, of course.
But I do think in this case, Alphabet pulls ahead. Their pitch is the opposite of a lot of these chipmakers. They make money from search, but also chips and Cloud and YouTube and Gemini, it's the everything AI company. But even when you strip AI out from Alphabet, it's not like the thesis breaks down. It's not like the company ceases to exist and that's not to say that I think there isn't risk with Alphabet. I certainly think there is. But between these two, I should really knock on wood, but I’m going to say it’s hard to see a world where Alphabet does not outperform Tencent, and that alone, I think, gives me Alphabet’s bet.
Travis Hoium: It's wild that we can have this discussion about Alphabet, and I don't think either of you have mentioned YouTube, an absolutely massive business bigger than Netflix, and yet it's just an afterthought when you think about Alphabet. I agree this is just one of the best companies in the world and not surprised that it won this matchup. We now have for the Championship. Alphabet versus MercadoLibre, Lou, you're making your pitch first. Who wins this?
Lou Whiteman: What's funny is just for fun, I put into Gemini, who would win a soccer match between MercadoLibre and Alphabet in Gemini. Do you know what Gemini said? Gemini said three to one to MercadoLibre, which do their bosses know that? I don't know. I think Gemini took it a little too literally and just talked about the South American tradition of soccer and all of that.
Travis Hoium: I can't see the Silicon Valley elite playing a lot of great soccer game.
Lou Whiteman: I am going to have to go with Alphabet, I think, here, too. There's a classic case where the underdog wins in the semifinal and gets our hopes up, and we're wow, if they can beat ASML, they can beat anyone and then we are just again, it's the France analogy where God, they're good, and I respect them, but it's always so boring when they just show up and just overwhelm the opposition. That's what happens here. It's a good game. MercadoLibre deserves a lot of credit, but Alphabet takes the win.
Emily Flippen: Man, I spoke too soon, Travis. You are going to have to be breaking a tie here because I'm the judge here, and I think MercadoLibre by far pulls ahead. Let me see. I agree with the AI in this case. I'm kicking myself for doing it, and the way that I'm framing up this match off on my head is I'm putting, let's say, $500 behind a recommendation today. Am I putting that money behind MercadoLibre? Am I putting that money behind Alphabet? I think there's, of course, a valuation argument that is boring and not worth getting into today. But the real reason it comes down is to growth, and in MercadoLibre, the opportunity in front of it is a fraction the size of Alphabet while still innovating and its fintech offerings that are just barely getting off the ground. Last quarter, revenue grew nearly 50%. That was the fastest pace for this company in nearly four years. It's an accelerating business, and they're doing it without spending oodles and oodles and oodles of capital on AI. In fact, when you strip out all of the narrative around AI today, I think MercadoLibre's thesis, it remains exactly the same. The credit book is a risk, of course, but I don't think it's less or any more risky, I should say, than a lot of the valuation that's driving I guess, speculation behind companies like Alphabet. MercadoLibre, when's in my book.
Travis Hoium: MercadoLibre had some tailwinds from U.S. currency, which would be headwinds for Alphabet. I just wanted to bring that in, 50% is a massive growth rate, but we do have a relatively weak dollar. I am the decider here. I'm going to give this to alphabet, and I'm going to go to something that we haven't talked about. We've talked about their artificial intelligence, their chips. We talked about Waymo. We talked about YouTube. They also own, what is it, 100, $150 billion worth of SpaceX stock and another $150 billion worth of Anthropic stock. Alphabet is not only one of the biggest, most powerful operators in the world. They are arguably one of the best investors in the world as well, and all that value is just hidden on their balance sheet. We are going to get a line item now. We'll end up in their next quarterly report. Now that SpaceX has gone public, and they have to mark that to market. Something for investors to consider next time they release earnings.
This was a lot of fun. I think it's a good tour around the world and some of the most powerful companies in the world. Great investment ideas. Hopefully, their Alphabet coming out on top in penalty kicks. When we come back, we are going to get to the stock center radar. You're listening to Motley Fool Hidden Gems Investing.
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Travis Hoium: As always, people on the program may have interest in the stocks they talk about and The Motley Fool may have formal recommendations for or against, so don't buy or sell stocks based solely on what you hear. All personal finance content follows The Motley Fool’s editorial standards and is not approved by advertisers. Advertisements are sponsored content and provided for informational purposes only. To see our full advertising disclosure, please check out our show notes. We like to end the show with the stocks on our radar. Emily, you are up first. What are you looking at?
Emily Flippen: I'm looking at Life Time Holdings. Ticker is LTH and this is the premium positioned JAM chain. They have massive big build-outs all across the country here. That's an asset-light sale leaseback model growing pretty rapidly. Double digits here. They target really affluent memberships. Their median household income is north of $150,000 a year, so it should be more resilient during pullbacks, but the real pitch I have for you here, Dan, and the reason why you think you should pick Lifetime is because you have children, if I'm not mistaken, right?
Dan Caplinger: I do, yes.
Emily Flippen: What sounds better to you than paying? You're relatively low, a couple hundred bucks, let's say, a month membership fee to go to a gym that will give you free child care while you and your partner go to the pool at Lifetime, sip a drink, lay back, and just have to spend a nice Saturday afternoon without your kids involved. That sounds really nice?
Dan Caplinger: I would probably be doing dead lifts and not going in the pool, but yes, that does sound nice.
Emily Flippen: Well, that's why you and I are different people, but, yes, that's my pitch here for Lifetime. They have a lot of affluent, child and child free, yes, but lots of people use it for their day care as well.
Travis Hoium: Dan, what do you think about Lifetime?
Dan Caplinger: It's a good pitch, Travis, I can't argue with that. Emily, is this one of those companies that also owns all their buildings and real estate stuff?
Emily Flippen: No, so they did initially, but they're in this process of doing sale-leasebacks to free up capital so they can build even more locations. That might hurt the long-term economics. I'm not gonna lie to you. But for the near term, it's actually doing a lot to improve their capital structure.
Travis Hoium: Emily is a rare occurrence where Emily brings something interesting and good to the show, so I'm very happy about that. Emily trying to get me to spend $659 a month on my local Lifetime membership.
Emily Flippen: Worth it?
Travis Hoium: Maybe no.
Lou Whiteman: Drinking by the pool is the workout I can get in.
Travis Hoium: Well, that's even more.
Lou Whiteman: Maybe.
Travis Hoium: Lou, what are you looking at?
Lou Whiteman: Dan, since Emily brought something good, I feel no obligation to do that to you. I'm looking at Rivian. I took her RIVN was supposed to be a fantastic moment for this maker of electric trucks and SUVs. The new R2 SUV, a mass market vehicle starting at a reasonable price of $58,000 is hitting the market. The R has a substantial waiting list, and the plan is for Rivian to see a huge uptick in cash flow and start that slow inch towards profitability. At last this week, the company said it was going to lay off about 2% of its workforce to save cash. The jobs they're laying off, marketing and customer support jobs, not the jobs you want to see go during a time when you're ramping up your customer list. This feels like a pivotal moment for Rivian, a company that lost more than $3 billion last year. It has been over time, almost impossible to build a new automaker from scratch. There's one big exception, and they almost went bankrupt. Rivian really needs this R2 to deliver on its promise and fast. I'm Just watching close here for the ride. Shall we say.
Travis Hoium: Dan, are you on the R2 reservation list?
Dan Caplinger: Absolutely not. Couldn't catch me dead in those dorky loser mobiles.
Travis Hoium: Well, at least we have a strong opinion. I assume Emily takes the cake today. We're gonna go with Lifetime Holdings today, Mr. Travis. Thank you to Lou and Emily and Dan behind the glass. I'm Travis Hoium. Thanks for listening. We'll see you here tomorrow.
Space Exploration Technologies (SPCX +0.15%), better known as SpaceX, has dominated the market headlines recently. It clearly made a splash when it went public as the largest IPO ever, and the stock immediately ran up to over $200 per share in the days following its debut. Now, it's down to about $153 per share due to an untimely announcement.
I think this was a major red flag for investors, and SpaceX would have been wiser to do this a few months down the road.
Image source: Getty Images.
What did SpaceX do to cause the sell-off? When a company goes public, it often issues additional shares to raise capital for the business. SpaceX was no different, issuing over 83 million shares in its IPO, bringing its total to just under 640 million. It raised $85.7 billion through this, creating a massive cash pile that SpaceX can use to pursue its goals.
For reference, SpaceX's capital expenditures during 2025 were nearly $21 billion. In 2024, that total was $11 billion, indicating a trajectory to double capital expenditures each year amid strong demand for its core products.
With that extra $85.7 billion, SpaceX can easily fund capital expenditures for over a year. So, whether SpaceX decides to build more computing capacity for xAI, launch more Starlink satellites, or invest in its space division, it has a ton of cash ready to deploy and shouldn't need to raise any more money in the near term.
Today's Change
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But that's exactly what SpaceX did.
The stock price crash in the last few days was caused by the announcement of a $25 billion bond issue. SpaceX raising an additional $25 billion after its IPO seems a bit untimely and looks bad, since it could have priced its stock higher during the IPO to easily raise that amount. The initial price of the SpaceX IPO was $135, even though it started trading around $150. There was also demand for the stock at $200 per share over the next few days.
This looks like bad financial management and makes me worried about how items like this will be handled in the future. As a result, I'm a bit wary to invest in SpaceX, and I think most investors should be too. SpaceX could still be a solid investment option, but it will take years for these long-term bets to pay off, and the time frame for these other businesses to come to fruition may make other stocks better picks in the meantime.
Earlier this month, Space Exploration Technologies (SPCX +0.15%), better known as SpaceX, finally completed its long-awaited initial public offering. The IPO predictably drew massive attention from retail and institutional investors alike, fueled by the company's innovations in reusable rockets and satellite internet connectivity, and its ambitious plans to deploy an orbital constellation of artificial intelligence (AI) data centers.
For everyday investors who had limited access to SpaceX's shares, its public market debut opens an interesting door. The question that many are asking is whether an investment in the stock now can realistically transform a modest portfolio into millionaire status.
The company's early price action and broader lessons about stock market dynamics offer important clues.
Image source: Getty Images.
Breaking down SpaceX's roller-coaster debut SpaceX's first days of trading as a public company followed a classic pattern for IPO stocks. While its offering price was $135 per share, the stock opened on the Nasdaq at $150 on June 12 and closed its first trading session near $161 -- delivering a quick pop. Momentum carried prices even higher during subsequent sessions, with SpaceX briefly surpassing $225 per share to command a market capitalization of roughly $2.8 trillion at that time.
However, questions about its lofty valuation combined with broader market sentiment triggered sharp pullbacks. As of late afternoon on June 24, SpaceX was trading at around $158.
These volatile swings underscore how new public companies often deliver dramatic short-term moves driven by hype, liquidity events, and shifting investor sentiment.
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What does an investment in the SpaceX IPO look like today? The majority of investors who have gotten involved in SpaceX stock so far were not able to secure shares at the offering price. A modest initial investment of $5,000 at SpaceX's opening price of $150 would be worth roughly $5,270 as of this writing -- a modest gain of just over 5%.
Despite the steep sell-off from its peak, a gain of 5% in less than a month is still impressive. To put this into context, the long-run average annual return of the S&P 500 is about 10%.
The key takeaway here is that IPO stocks can deliver some quick upside. At the same time, these gains can be fleeting: Even after a strong debut, the position remains exposed to heavy selling. Moreover, the absolute dollar amounts remain limited.
IPOs often create quick wins for momentum traders, but they rarely deliver the kind of transformative, multiyear compound growth that's required to create generational wealth.
Can investing in SpaceX really make you a millionaire? The SpaceX IPO reinforces a fundamental truth about investing: Multibaggers are almost never created overnight. While the stock has delivered a decent gain for its earliest buyers, whether it can produce sustained outperformance will depend on how well the company executes on its ambitions over many years across its various business segments. History shows that stocks capable of turning small sums into millions always require patience, resilience, and conviction through drawdowns, and time for the power of compound growth to work its magic.
For retail investors, the most practical route to building a million-dollar portfolio involves dollar-cost averaging -- investing fixed amounts at regular intervals regardless of short-term price swings -- over time horizons of between 15 and 30 years or more. By steadily adding to a position in SpaceX while management scales the business, any investor can accumulate more shares during dips and position themselves to benefit from its potential price appreciation.
The 2026 year is nearly half over and investors are trying to decide where to put their money for the second half of the year and beyond, especially after many market indexes hit new all-time highs at some point this year.
SpaceX (SPCX +0.13%) has taken investors on a wild ride since its June 12 IPO. It went public at $135 per share, reached a record high of $225.64 on June 16, but now trades at about $150. That volatility wasn't surprising, since it was the biggest IPO in history, with a debut valuation of $1.77 trillion, and a divisive stock.
The bulls expect its aerospace and AI businesses to grow exponentially, while the bears believe it's speculative and overvalued. Let's review both arguments and see how much a $10,000 investment in SpaceX could be worth by the end of 2030.
Image source: Getty Images.
The bullish case for SpaceX SpaceX's founder and CEO, Elon Musk, claims the company's annual revenue could reach $1 trillion by 2030. That would represent a 122% CAGR from its $18.7 billion in revenue in 2025. Wall Street's analysts believe SpaceX's annual revenue could reach $330 billion to $470 billion, representing 5-year CAGRs of 78% and 91%, respectively, if everything goes right.
To hit those targets, SpaceX needs to aggressively expand its launch (Falcon and Starship), Starlink, and xAI businesses. Starship, its largest rocket ever, could reduce its cost to orbit to less than $100 per kilogram and wipe out its smaller competitors in space logistics.
Starlink, which already serves over 10.3 million subscribers, could gain tens of millions more users across the enterprise, maritime, aviation, and defense sectors. Starlink is already profitable, and its profits will surge even higher as economies of scale kick in.
The xAI segment, which handles Grok, X, Cursor, and other AI-related businesses, could evolve into an AI infrastructure company as it launches its first orbital data centers. It would support that expansion with its launch and Starlink businesses.
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The bear case against SpaceX The bears will point out that SpaceX is still unprofitable, since Starlink's profits aren't offsetting the steep losses in its space and AI divisions. At $2.04 trillion, it's already valued at 109 times last year's sales -- so it looks expensive relative to its past growth.
SpaceX recently diluted its investors with its $60 billion all-stock takeover of the AI coding start-up Cursor, and it just announced another $25 billion bond offering -- even though it raised a record $75 billion in its IPO. Those issues could all limit its gains, especially if interest rates surge and drive investors away from speculative stocks.
Where will SpaceX be in 2030? I believe SpaceX will struggle to achieve its ambitious near-term goals -- which rely on hundreds of flawless launches, low interest rates, and rock-solid economic growth -- by 2030. Instead, a more realistic target might be a 30% CAGR (compared to its 33% revenue growth in 2025) from 2025 to 2030 -- which would still boost its revenue to $69.4 billion by the final year.
With a generous price-to-sales ratio of 30, it would have a market cap of $2.08 trillion in 2030. That 2% gain would only turn a $10,000 investment into about $10,200, so investors probably shouldn't go all-in on SpaceX until it posts its first quarterly reports.
