Key facts
- SpaceX plans to price its IPO at $135 per share.
- The company aims to raise $75 billion through its IPO.
- SpaceX targets a valuation of $1.75 trillion for its IPO.
- The IPO is expected to debut on Nasdaq on June 12.
- The offering is reportedly oversubscribed twice, with investor demand reaching $150 billion.
- Morningstar estimates SpaceX's value at $780 billion, significantly below the IPO target.
- SpaceX reported a net loss of $4.95 billion last year.
- SpaceX secured tax incentives for its Terafab chip project in Texas, with an initial investment of $55 billion.
- SpaceX sold spectrum licenses to EchoStar for $17 billion in cash and equity.
- Investors from mainland China and Hong Kong are excluded from the IPO due to security concerns.
- SpaceX has a multi-year cloud services agreement with Google valued at $920 million monthly.
- SpaceX will not be eligible for S&P 500 index entry until June 2027 due to existing rules.
SpaceX is poised to launch a historic initial public offering (IPO), aiming to raise $75 billion by selling shares at $135 each, which would value the company at $1.75 trillion. This offering, slated to begin trading on the Nasdaq on June 12, is anticipated to be the largest IPO in history. The substantial proceeds are earmarked for expanding SpaceX's AI computing capabilities and its satellite network, Starlink. Investor demand appears robust, with reports indicating the IPO is oversubscribed by a factor of two, attracting $150 billion in interest against the $75 billion target. Fidelity has lowered its minimum investment threshold to $2,000 for retail investors, and Kraken is offering access via tokenized equity instruments in over 110 markets, while Interactive Brokers UK clients will also have access. However, investors from mainland China and Hong Kong are excluded due to regulatory and compliance concerns related to US critical technology export restrictions.
Despite the strong demand, some financial analysts express skepticism regarding SpaceX's valuation. Morningstar analyst Nicholas Owens estimates the company's value at $780 billion, significantly below the IPO target, citing a net loss of $4.95 billion last year. Similarly, an analyst from Morgan Stanley suggests the $1.75 trillion valuation overvalues the company by over 50%. Concerns also linger about the economics of AI businesses and Starlink's profitability. The IPO filing has also revealed potential for a Tesla merger, with some analyses projecting a combined entity value of $3.4 trillion, though the financial logic faces scrutiny. SpaceX has also secured significant tax incentives for its Terafab chip manufacturing project in Texas, with an initial investment of $55 billion. In a separate development, SpaceX sold spectrum licenses to EchoStar for $17 billion in cash and equity, positioning EchoStar as a proxy for SpaceX's IPO.
The impending IPO is occurring amidst a broader trend of AI companies preparing for public listings, including Anthropic and OpenAI, intensifying competition for capital. S&P Dow Jones Indices, however, will maintain its existing listing rules, meaning SpaceX will not be eligible for rapid index entry into the S&P 500 until June 2027, requiring standard profitability and 12-month seasoning criteria. This decision contrasts with potential changes being considered by S&P Dow Jones Indices to allow unprofitable tech companies into indices. SpaceX's expansion into data centers has also led to an amended IPO filing highlighting water access as a risk factor. The company has also entered into a multi-year cloud services agreement with Google, valued at $920 million monthly for GPU and CPU components.