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Since its first trade on June 12, SpaceX has lost over $500 billion in market cap, a stunning blow to retail investors who jumped into Elon Musk's rocket company at their first opportunity. The stock is coming off its fourth straight weekly loss and is more than 50% off its intraday high.
Not since Facebook's IPO in 2012 have tech investors seen such a high-profile offering lead to such early disappointment. Facebook stumbled out of the gate and trended lower for months before bottoming at less than half its IPO price. But Facebook's total market cap after its first day of trading was about $100 billion, or roughly one-fifth the amount of value SpaceX has shed since its initial pop.
That's the backdrop for SpaceX's first earnings report as a public company, which is scheduled to land after the bell on Tuesday. It comes two weeks after Tesla's earnings were panned by Wall Street due to soaring costs, negative free cash flow and Musk's cautious tone on scaling the company's Robotaxi service. Last week tech's hyperscalers wrapped up their quarterly updates, which had investors laser focused on artificial intelligence spending.
For SpaceX, the story is more complicated than for its trillion-dollar peers. So much of the investment thesis is a bet on Musk, and his mission to build data centers in space soon and eventually colonize Mars, while trying to develop AI services to rival Google, OpenAI and Anthropic.
Unlike the other megacaps, SpaceX's market cap, currently sitting at $1.4 trillion, isn't supported by any of today's financial metrics. Its price-to-sales ratio, based on trailing revenue, is in the 70s, the business is burning billions of dollars a quarter and the company has almost twice as much debt as cash.
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Weighing down SpaceX's stock is the possibility that a flood of new shares will hit the market as rolling lock-up restrictions expire, starting in the coming days, giving early investors their first opportunity to sell.
In the meantime, short sellers have been cleaning up by betting on the drop. As of Friday, shorts were up about $8.3 billion in paper profits since the IPO, according to Matthew Unterman, head of research at S3 Partners.
"It's among the most aggressive and quickest bearish builds we have seen in a mega-cap name heading into its first earnings report post-IPO," Unterman said in an email.
Ben Harwood, an analyst at New Street Research, said that while "the shares have been volatile since the IPO," the downturn has presented a buying opportunity.
"For a long-term investor we think this is an attractive entry point," Harwood wrote in an email. "The growth runway is enormous, and SpaceX has one of the widest moats in the market today."
New Street initiated coverage of SpaceX just before the IPO with a $165 target price. The shares closed on Friday at $108.37.
Banking on Starship
The bullish case for SpaceX often begins with Starship, the company's next-generation rocket designed to be fully reusable and to hoist its newer and more powerful v3 satellites into orbit.
If Starship succeeds, the company says it can reduce the costs of sending cargo or people into space, enabling SpaceX to rapidly expand its Starlink constellation and satellite communications services. SpaceX's connectivity business is its only profitable segment.
While its earlier Falcon rockets established SpaceX as the world's top launch provider, the company's launch business is still losing money. Starship is supposed to deliver many times the capacity of the Falcon rockets, leading to more sustainable economics for research, defense and connectivity customers, while also potentially making space tourism a real industry.
SpaceX stock performance
SpaceX spelled out Starship's importance in its IPO prospectus.
"If Starship does not achieve full reusability or rapid turnaround, we may experience higher per-launch costs, slower deployment timelines for our large-scale constellations (including our orbital AI compute program), delayed revenue growth, and increased overall capital requirements, and our brand and reputation may suffer," the company wrote.
SpaceX also said in the filing that it expects Starship to "commence payload delivery to orbit" in the second half of this year.
SpaceX completed its 13th test flight of the approximately 400-foot-tall rocket on July 24, from its launch facilities in the company town of Starbase, Texas. The rocket's Super Heavy booster detached from the Starship spacecraft about two minutes into the flight, and splashed down in the Gulf of Mexico.
However, SpaceX said in a statement following the launch that the landing wasn't perfect. Starship's booster "attempted to relight its engines for the landing burn," the company said, but only a subset of those successfully ignited before a "hard splashdown."
The SpaceX Starship and Super Heavy v3 Booster lift off on its 13th test flight from the SpaceX launch complex in Starbase, Texas, U.S., July 24, 2026.
Steve Nesius | Reuters
For analysts at Bernstein, Starship is the most important issue for SpaceX in justifying its valuation. In a note to clients on Friday, the firm laid out three other key matters the company needs to address: semiconductor availability, regulatory processes and compute capacity.
SpaceX needs a massive number of processors for its data center satellites as it tries to build orbital data centers, and requires approval from the Federal Aviation Administration for each Starship launch. And as the company tries to become a leader in AI, after merging in February with Musk's xAI, it has to continuously build up compute capacity in a resource-constrained world.
Still, the Bernstein analysts recommend buying the stock and have a price target of $239 heading into Tuesday's earnings.
"We believe the quarterly results should not matter," the analysts wrote. "What will be important is the level of confidence projected by management regarding the company's growth path."
Following results from Alphabet, Meta, Microsoft and Amazon over the past couple weeks, SpaceX's AI strategy and its capex requirements will be under a microscope. In particular, investors are likely to want to know about plans for Cursor, the AI-coding startup that SpaceX agreed to acquire for $60 billion. The deal is expected to formally close in the third quarter pending regulatory approval.
Meanwhile, the company's Grok chatbot has scored some big contracts, notably with the U.S. Department of Defense. It's also stirred controversy, leading to probes and lawsuits in Europe and the U.S. after Grok's image editing tools let people easily create and spread deepfake porn.
With Musk's AI efforts struggling to gain significant traction against the likes of OpenAI and Anthropic, SpaceX has turned to leasing out excess compute capacity at its data centers to generate revenue from its buildout while further developing its AI models and services.
Days before its record IPO, SpaceX inked a deal with Google that will bring in $920 million a month by providing AI compute capacity to the search giant. Prior to that, Anthropic announced a deal to use all of SpaceX's capacity at the company's Colossus 1 data center in Memphis, Tennessee. And SpaceX has a separate agreement to provide computing power to Reflection AI.
The new revenue stream is one reason analysts at Cantor are optimistic and have a $246 price target on the stock.
"We think earnings can meaningfully alleviate some of those pressures as the company proves out hosted-compute profits, clarifies capital funding geographies, and clears its initial lockup headwinds," the analysts wrote last week. "We view SPCX as approaching a bottom into the print."
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