Axios: “SpaceX not the behemoth everyone thought”

The big picture: It’s expected to be the largest IPO ever, and could make Elon Musk the world’s first trillionaire.

• But the prospectus shows just how much the IPO depends on expectations for future growth and investor servility to Musk — as opposed to the current underlying business.

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By the numbers: SpaceX is wildly unprofitable, reporting a $4.9 billion net loss on $18.67 billion in consolidated revenue for 2025.

• For context, 200 companies in the S&P 500 had more revenue last year than did SpaceX. This includes Tesla, whose sales were five times higher.
• SpaceX said that the AI unit containing X and xAI generated only $818 million in Q1 2026, about a third less than Twitter alone generated in the quarter before Musk took it over.

Dan Primack

Brief article, but it gets the point across in a concise way. As we have seen time and again with Tesla, Musk is counting less on his businesses being solid, and more on his public ‘aura’ as tech entrepreneur to drive up valuations and keep making money. Another signature move is making his somewhat successful ventures bail out hopelessly unprofitable ones: just as Tesla rescued SolarCity a couple of years back, now it’s SpaceX’s turn to pick up the bill for xAI.

Compared to previous go-publics, SpaceX’s valuation falls nothing short of insane. Meta went public at 28 times sales with 88% revenue growth. Google went public at 10 times sales with 240% growth. Put another way, SpaceX is growing seven times slower while asking for a multiple ten times higher. Source: Ed Elson: SpaceX-stasy

There are several concerning aspects of the SpaceX IPO, starting with its immensely inflated value: set to be priced at around 100 times sales, this would make SpaceX one of the most expensive stocks in history — although the value goal has been cut back slightly to at least $1.8 trillion. Another one is how Musk is setting up the share voting structure so that he is virtually impossible to fire from his ‌role as chief executive and chairman of the board, giving him much more control over the company than anyone would have in a typical publicly listed company.

Finally, the Nasdaq recently changed index rules for mega-IPOs: any newly listed company that ranks among the top 40 by market capitalization will be included in its Nasdaq 100 index after just 15 days of trading, exempt from previous seasoning and liquidity requirements. The rule change effectively forces passive investment funds linked to the Nasdaq 100 to buy SpaceX shares shortly after they are listed, as opposed to a longer cooldown period to allow for the value of the company to settle at a more realistic level. This might result in a massive flow of investment from mutual and pension funds into fresh, overvalued IPOs — since OpenAI and Anthropic are also expected to go public later this year — only to see those valuations drastically cut back in the future, thus wiping out large portions of people’s retirement savings. Even if the outcome is not quite as dramatic, seeing stock exchanges amend their rules to favor rich investors could undermine the public’s confidence in the US stock markets and lead to declining public investments.

In inflation-adjusted terms, SpaceX alone would rank as the second-largest IPO in history, just behind Saudi Aramco. All three together would exceed the entire dot-com IPO wave of 1995–2000. They will be at least half the value, inflation-adjusted, of all US IPOs since WWII. Source: Paul Kedrosky: The Coming Mega-IPO Flow & Funding Problem of 2026

Then there’s the rather obvious problem of profitability: when is this newly formed conglomerate of space rockets and AI models supposed to break even? The prospects are pretty poor on the xAI side of the equation. On top of their documented losses, the recent deal to lease compute capacity at the Colossus 1 data center to Anthropic might signal weak demand for xAI’s own products. Elon Musk then shed doubt on those terms, despite contradicting SpaceX’s S-1 filing, which in turn should make any rational person question whether other statements in the filing accurately reflect the state of things at the company.

Starlink on the other hand might have more leeway based on it being a near-monopoly — and as we know from recent experience with US tech giants, it certainly pays to be a monopoly. I don’t think the consumer side of the business will be enough to cover the massive infrastructure costs to build rockets and continually replace satellites, but Musk may have found the single perfect customer to cover all his bills: the US government. Employing the satellites for military purposes started with the war in Ukraine, and is now expanding to the war in Iran: according to a recent report, SpaceX is negotiating with the Pentagon looking to increase the Starlink connection cost fivefold to $25,000 per drone. After the explosive setback of Blue Origin a couple of days ago, Elon Musk might have the perfect opportunity to press his advantage further and squeeze his largest customer in the absence of meaningful competition for years to come.