SpaceX, Elon Musk’s aerospace conglomerate, has witnessed an extraordinary post-listing surge on Wall Street, adding $US122 billion ($173 billion AUD) to its valuation in a single day. Shares peaked at $US2.97 trillion during Tuesday’s trading, briefly surpassing Amazon and Microsoft. Closing up 4.8 per cent, SpaceX settled at a $US2.65 trillion capitalisation. Since its Friday debut at $US1.75 trillion, the company’s shares have climbed 49.4 per cent in three sessions.
This rapid ascent occurs despite a significant disparity between SpaceX’s valuation and current financial performance. Known for its Starlink satellite internet service and space exploration, SpaceX also has an emerging artificial intelligence business. Last year, the company reported annual revenue of $US19 billion and a loss of $US9 billion. This contrasts sharply with established tech giants. SpaceX currently trades at an extraordinary 140 times sales, far exceeding historical benchmarks like Google’s 24 times sales at its 2004 IPO.
A substantial portion of SpaceX’s valuation, estimated near $US2 trillion, is attributed to a largely unproven artificial intelligence business. Industry observers suggest this segment lags rivals, its AI efforts nascent and exemplified by the recent $US60 billion all-stock acquisition of vibe-coding firm Cursor. Market strategists point to momentum and specific mechanics as key drivers in this “risk-on” environment. A low float of available shares, with a significant portion of IPO stock changing hands rapidly, indicates a market squeeze fuelled by intense investor demand.
While SpaceX’s initial market days have been historically spectacular, the long-term performance of large IPOs on Wall Street often proves unpredictable. Past data shows a mixed record, with many experiencing significant declines from their initial closing prices within a year. The coming months will provide further clarity on whether SpaceX’s current trajectory is sustainable.
