One month after SpaceX made its historic debut on public stock markets, investors who once celebrated the listing have shifted to growing concern over the company’s volatile share performance.
When Elon Musk-led SpaceX opened trading to individual investors on June 12, the IPO sparked an immediate buying frenzy. Priced at $135 per share in the company’s official offering, the stock jumped to $150 within minutes of the first session, peaked at $176 intraday, and closed at $160.95. This listing cemented SpaceX as the largest initial public offering in global history, and momentum only accelerated in the following week: shares hit an intraday high of $225, pushing the company’s total market capitalization above both Amazon and Microsoft.
Industry analysts note that much of this initial hype was tied to artificial intelligence, rather than SpaceX’s core aerospace business. “With Elon Musk, any company he touches gets people excited,” explained Keith Snyder, an analyst at investment research firm CFRA. “But this was also the first time people felt like they were able to invest in something that was being marketed as an AI play.”
Willy Lee, an investor at Neosteller, a firm that enables individual investment in private pre-IPO companies, echoed this assessment, saying “Everyone saw SpaceX as an AI story.” That narrative gained traction after SpaceX acquired Musk’s standalone AI startup xAI earlier this year, rebranded the firm as SpaceXAI (known for its controversial chatbot Grok), and began offering data center leasing services to external tech companies.
But as the hype faded, investors began refocusing on the reality of SpaceX’s core revenue streams: manufacturing and launching rockets, and operating its Starlink satellite internet network. The first major pullback came when Starlink announced price cuts for its services in Memphis, Tennessee, amid local pushback against a planned massive SpaceX data center project; the stock dropped 8% on that single trading day.
Since that initial drop, shares have fallen steadily, even against a broader backdrop of volatility across the technology sector. For example, when SpaceX was added to the Nasdaq 100 index on July 7, the overall index fell 1.7% – but SpaceX dropped 4.4% over the session. A prior addition to the FTSE Russell index had only delivered a minor, temporary boost to share prices.
By the end of its first full month as a public company, SpaceX shares traded around $145 per share. That marks an 18% drop from the first day’s closing price and a 35% fall from the stock’s all-time peak so far. Early retail investors who bought shares in the first five days of trading are now facing significant paper losses. “If you bought around the first tick you’re definitely underwater,” Snyder said, adding that the stock’s initial run began to look a lot like a meme stock, echoing the 2021 GameStop rally and more recent Wendy’s price surge driven by coordinated retail investor excitement online rather than underlying business fundamentals.
Snyder projects the stock could fall even further, to around $115 per share, aligned with the company’s current operating performance, which would value SpaceX at roughly $1.5 trillion.
Samuel Kerr, head of equity capital markets analysis at Mergermarket, noted that the extreme price swings have impacted different investor groups very differently. “If you’re an IPO investor, you’re ok,” Kerr said, referring to institutional investors who bought shares at the original $135 offering price and early insiders who held pre-IPO equity. “If you bought in the first few days, you’re not very happy right now.”
Despite the market turbulence, Musk has remained unwaveringly optimistic about SpaceX’s long-term business prospects. The IPO’s valuation surge made him the world’s first trillionaire, and he has publicly predicted that SpaceX will hit $1 trillion in annual revenue by 2030.
Musk has also leveraged the stock’s volatility for strategic corporate moves. When shares spiked on June 16, SpaceX announced an all-stock $60 billion acquisition of Cursor, a startup that builds AI tools for code writing. Given the size of the share price gain at that moment, Kerr noted, Musk essentially acquired the company for free. “It showed a level of market sophistication that almost no other issuer has,” Kerr said of the deal.
Not all financial analysts are bearish on the stock. Morgan Stanley, the lead underwriter for SpaceX’s IPO, initiated coverage of the stock last week with a $300 per share target price – 33% higher than the stock’s current all-time peak, suggesting the current dip is only a temporary setback.
Public filings from SpaceX’s IPO process show the company currently operates at a net loss, and generated $18 billion in total revenue last year. Musk’s $1 trillion annual revenue projection for 2030 is 55 times that 2025 figure, leaving analysts to question how the company will hit that aggressive target.
All eyes are now turning to SpaceX’s first public earnings report, expected to drop in early August, though no official date has been announced. The report will coincide with the end of SpaceX’s IPO lock-up period, which has prohibited employees from selling equity granted as compensation. When the lock-up expires, thousands of new shares will enter the open market, a shift that could add further volatility to the stock price.
“If SpaceX can do all the things it says it will do, yes, investors are sitting on the most valuable company ever,” Kerr said. “But it’s got a lot of work to do to get there.”