On April 13, 1970, an oxygen tank exploded aboard Apollo 13 more than 300,000 kilometres from Earth. What was meant to be a Moon landing became a desperate fight for survival. Using only the equipment already on board, NASA engineers improvised solutions with duct tape, plastic bags, and sheer ingenuity, bringing all three astronauts safely home.
Apollo 13 never reached the Moon, but it demonstrated a timeless truth: humans do their best thinking when failure is not an option.
By the early 2000s, that spirit seemed lost. Space exploration had become expensive, cautious, and incremental. Then, in 2002, a startup called SpaceX set out to change that. Most experts expected it to fail. Instead, it became the first private company to reach orbit, dock with the International Space Station, land and reuse orbital rockets, and fly astronauts into space. In the process, it cut launch costs by more than 90% and transformed the economics of the industry.
Now SpaceX is attempting another first. On June 12, 2026, it goes public at a record breaking $2 trillion valuation, making it the largest IPO in history, more than double the previous record held by Saudi Aramco in 2019.
The investment story is straightforward: SpaceX dominates launch services, operates the world’s largest satellite network through Starlink, and is pursuing ambitions that range from Mars colonisation to space-based computing infrastructure.
The harder question is valuation. At $2 trillion, investors are not just paying for what SpaceX has achieved, but for what it might achieve over the coming decades.
This newsletter examines that question: what investors are actually buying, what the numbers look like once the storytelling stops, and whether the market has finally found a fair price for the world’s most ambitious company, or is paying today for a future that may never arrive.
In this edition:
- Why SpaceX is going public now, and why it had no choice
- What the business actually looks like
- The valuation that even the most optimistic analysts cannot fully justify
- How the IPO has been engineered to look like a success on day one
- What owning SpaceX actually means in terms of control
- How Indian wealth creators should think about it
Why is SpaceX going public now?
For years, Musk insisted that SpaceX would never go public. He argued that public markets focus on quarterly results, while SpaceX was building for decades into the future. As a result, the company stayed private and grew from a $2 billion valuation in 2012 to over $300 billion by 2024 without needing Wall Street.
That changed in 2026 when SpaceX merged with xAI, which had already absorbed X (formerly Twitter). The deal added significant debt ($30 billion) to SpaceX and included financing that effectively made an IPO unavoidable.
On June 12, SpaceX will be listed on Nasdaq at a targeted $2 trillion valuation, making it the largest IPO in history. Interestingly, the filing opens not with revenue figures or profit projections but with a mission statement about extending the light of consciousness to the stars. That phrase appears ten times across 277 pages submitted to the SEC. Investors are being asked to buy into a vision as much as a business.
What SpaceX actually is and how it makes money
Most people think of SpaceX as a rocket company, but the company is actually split into three distinct segments. Understanding each one separately is the way to make sense of everything that follows.
1. Space: Launch Services
This is SpaceX’s original business: building and launching rockets such as Falcon 9, Falcon Heavy, and Starship. Its breakthrough was rocket reusability, which cut launch costs by roughly 85% and helped SpaceX capture over 80% of global orbital launch mass.
Despite its engineering success, the segment generated just $4.1 billion in FY25 revenue and grew only 8%, with many launches now dedicated to deploying Starlink satellites.
2. Connectivity: Starlink
Starlink is SpaceX’s growth engine. With 9,600 satellites and 10.3 million subscribers across 164 countries, it generated $11.4 billion in FY25 revenue, growing 50% year-over-year with a 39% operating margin, making it SpaceX’s most profitable business.
Its biggest advantage is vertical integration: SpaceX launches its own satellites at internal cost, giving Starlink a structural cost advantage over competitors.
3. AI: xAI, Grok & X
In February 2026, SpaceX merged with xAI, Elon’s AI startup. The newest segment combines xAI, Grok, X, and the Colossus data center. It generated $3.2 billion in FY25 revenue but lost $6.3 billion as it invested heavily in AI infrastructure. While xAI is expected to contribute only about $1 billion of 2026 revenue, the deal expanded the company’s growth narrative and helped justify its $1.25 trillion valuation.
However, a post-filing agreement with Anthropic worth approximately $15 billion annually could rapidly transform the division into SpaceX’s largest business.
The case for valuation: Justified or not?
At a $2 trillion valuation and $18.7 billion of revenue, SpaceX is being valued at around 100 times sales. The company also lost $4.9 billion last year. That is the entire valuation debate in one sentence.
To feel what 100 times revenue actually means, consider Walmart.
The world’s largest company by revenue, profitable for decades, is worth less than half of what SpaceX is asking for on its first day as a public company.
In May 2025, SpaceX was valued at roughly $350 billion in a private tender offer. By December 2025 that had doubled to $800 billion. The xAI merger in February 2026 pushed it to $1.25 trillion. The IPO filing in April targeted $1.75 trillion. That is a 5x increase in under a year, before a single public earnings report.
So how does a number like $1.75 trillion actually get constructed?
You see, when investment banks value a company for an IPO, they usually break it into different businesses, estimate future revenue or profit for each, apply a valuation multiple, and add everything together. The final number depends heavily on the assumptions used.
The challenge with SpaceX is that there is no clean comparable anywhere in public markets. Aswath Damodaran, professor of finance at NYU Stern, who has spent decades valuing companies, has noted that when banks cannot identify a genuine peer for a company, it usually means the valuation is hard to justify.
Here is what valuation exercise looks like for SpaceX, using the analysis from Meritech Capital:
A sum-of-the-parts analysis helps explain the numbers. According to Meritech Capital, the launch business is worth about $88 billion and Starlink around $371 billion. Together, they account for roughly $460 billion of value. The remaining $1.2 trillion, nearly 70% of the valuation, comes from AI.
That AI valuation rests heavily on a single contract with Anthropic worth about $15 billion annually. Applying a high revenue multiple to that agreement creates much of the division’s value. The challenge is that either party can terminate the contract with 90 days’ notice, and Anthropic is also a direct competitor to Grok.
SpaceX also cites a $28.5 trillion TAM, nearly 30% of global GDP. But large markets do not automatically create large companies. The key question is how much of that opportunity SpaceX can realistically capture, at what margins, and over what timeframe.
However, before forming a negative view, I also went and read the most compelling bull case I could find. The argument is that AI will improve productivity across large parts of the global services economy, law, accounting, healthcare administration, customer support, software development and more, by roughly 10%. Services account for roughly 60% of global economic activity, so $60 trillion.
If AI improves productivity by 10%, that could create around $6 trillion of additional economic value each year. Under that scenario, a $35-40 trillion valuation for the AI industry may not seem unreasonable. And as a company building critical AI infrastructure, SpaceX could capture a meaningful share of that value.
The problem is timing. Will that value emerge in five years, ten years, or twenty? Small changes in timing have an enormous impact on today’s valuation. That is why the debate is not whether SpaceX is an extraordinary company. It clearly is. The real question is whether it is an extraordinary investment at a $2 trillion valuation.
The IPO is engineered to look like a success
The structure of this IPO helps explain why the stock could perform well initially, even if that says little about its long-term value.
Nasdaq changed its rules to make it easier for SpaceX to enter the Nasdaq-100. Normally a newly listed company has to wait about 3 months before qualifying. SpaceX will be eligible after just 15 trading days. It is also listing only about 4% of its shares publicly, a free float so small that under the old rules it would not have qualified for index inclusion at all.
Once included, index funds tracking the Nasdaq-100 will be forced to buy billions of dollars’
worth of shares regardless of valuation. That means billions of dollars of demand gets created by the rules themselves, not by investors making a deliberate choice
Although only about 4% of SpaceX’s shares will trade publicly, the company has also reserved roughly 30% of that IPO allocation for retail investors, an unusually large share for a company of this size, reflecting the strong enthusiasm surrounding the company and its founder.
Musk and key investors have agreed to a 366-day lockup, double the standard 180 days, and cannot sell a single share for a full year after listing. For a company where the investment story revolves so heavily around one person, that commitment is worth noting.
For everyone else, shares unlock in stages across the first six months rather than all at once, with the first window opening after Q2 earnings between July and September and a second large release after Q3 earnings. Full restrictions lifted around mid-December 2026.
Another detail worth noting is that SpaceX reserved 5% of the IPO for undisclosed insiders with no lockup at all. At this scale of offering, that is not a small number.
The net result is that the stock will face recurring waves of potential selling throughout its first six months, not one cliff in December. Musk staying locked in for a year removes the biggest single risk. Everything else is a rolling test.
The financial picture also deserves attention. SpaceX ended Q1 2026 with $16.6 billion in cash, $29 billion in long-term debt, and a $20 billion bridge loan due within 15 months. Free cash flow was negative $14 billion in FY25 and negative $9 billion in Q1 alone, making continued execution and access to capital critical.
More broadly, the IPO highlights how much influence index providers now have over capital allocation. In the past, investors decided where money flowed. Today, inclusion in a major index can generate billions of dollars of demand automatically.
SpaceX may be the clearest example yet. The IPO will likely look successful. The more interesting question is how much of that success comes from investors choosing to buy the stock, and how much comes from a system that requires them to.
The Elon Musk Risk: Shareholder’s Ownership
Musk owns about 44% of SpaceX’s economic interest but controls roughly 85% of the voting power. In 2025, his salary was just $54,080. Instead, his compensation is tied almost entirely to long-term goals. In early 2026, he was granted 1 billion performance-based shares that vest only if SpaceX reaches massive valuation milestones and succeeds in building a permanent human settlement on Mars.
A month later, he received another 302 million shares tied to building non-Earth data centres capable of delivering 100 terawatts of compute power, a target thousands of times larger than today’s biggest AI infrastructure projects.
The message is clear: Musk is not building SpaceX for the next few years. He is building it for outcomes that could take decades. Whether that is exciting or concerning depends on your perspective as an investor.
The filing also states that there is no expectation Musk will prioritise SpaceX over his other companies. History makes this difficult to judge. Many investors spent years arguing that Tesla was overvalued and were right about the numbers but wrong about the outcome.
The safest position may be neither blind optimism nor outright skepticism, but patience, waiting for a price that reflects what the business earns today, not just what it could become tomorrow.
Why SpaceX’s $600M Bitcoin holdings matter
One detail worth knowing before investing is SpaceX’s Bitcoin holdings. According to on-chain data, the company owns about 8,285 Bitcoin worth roughly $600 million, making it one of the world’s largest corporate Bitcoin holders.
What’s notable is that SpaceX has continued to hold the position despite reporting a large loss and negative free cash flow. That suggests management views Bitcoin as a long-term strategic asset rather than a source of liquidity.
For investors, the bigger issue is earnings volatility. Once public, SpaceX will have to report Bitcoin at fair value each quarter. If Bitcoin falls sharply, reported earnings could take a significant hit even if the core rocket, satellite, and AI businesses perform well. If Bitcoin rises, earnings could get an equally significant boost.
In short, future SpaceX earnings will be influenced not only by launches and Starlink growth, but also by Bitcoin’s price movements.
How Indian wealth creators should think about it
A significant portion of this $2 trillion is a personality premium. That premium is real, it sustained Tesla through multiple near-death experiences, but personality premiums are also the first thing to compress when sentiment shifts, and they cannot be quantified in any financial model.
Consider what this IPO means in terms of one man’s concentration of market value. Tesla plus SpaceX at IPO valuation equals $3.5 trillion, the fourth largest combined entity on earth, behind only Nvidia, Alphabet, and Apple. One person would control two of the five most valuable companies in the world. That is not a reason to avoid SpaceX. It is a risk factor that deserves to sit clearly in your mind before you decide how much of your portfolio to allocate.
Before making any decision, consider three questions
- What are you actually buying? Is it Starlink, the AI business, or the Musk vision? Each deserves a different valuation and carries a different risk profile, yet the IPO packages them together at a single price.
- How much Musk exposure do you already have? Investors who own Tesla directly or through global technology funds already carry significant Musk-related risk. Adding SpaceX increases that concentration more than many realise.
- What is your entry point? Buying at the IPO and buying after major lockup expiries are very different investments that could come with very different prices and risk-reward profiles.
For those who want exposure to this theme without the full SpaceX premium, Alphabet owns approximately 7 to 8% of SpaceX, a position worth around $60 billion at IPO valuation, and also holds a significant stake in Anthropic. It trades at 19 times earnings with its own AI infrastructure, autonomous vehicle, and cloud businesses already generating cash.
It is not a pure play. But for a time-poor investor who does not want to actively manage a speculative single-stock position, it gives you the upside of the theme without requiring you to buy at the moment of maximum enthusiasm.
The Verdict
Historically, major IPO waves have often appeared near market peaks. In 1999, more than 400 companies went public just before the Nasdaq fell 78%. Companies tend to list when investor enthusiasm and valuations are at their highest.
SpaceX is not one of hundreds of speculative IPOs. But at a $2 trillion valuation, it is large enough to absorb enormous amounts of capital at a time when excitement around AI and technology is already elevated.
The history of large tech IPOs is worth sitting with for a moment before deciding how excited to be. Of the 25 biggest technology IPOs globally, 16 traded below their debut-day closing price within 12 months. The median decline was about 22%. Facebook and Alibaba both fell around 30% in their first year as public companies. Snap lost more than half its value before eventually recovering, while Uber dropped from its $45 IPO price to below $30 within months.
The ones that held up, Google, Amazon, did so because they were already profitable and growing when they listed.
Today, many investors are heavily concentrated in AI stocks. SpaceX arrives with an equally compelling story. Some money may shift from AI stocks into SpaceX. If that happens, it could put pressure on AI stocks as investors redirect capital elsewhere.
And if SpaceX disappoints after listing, investors may begin questioning not just this company, but the broader willingness to pay extreme valuations for future growth.
But how much of the market gets affected depends on one key difference between this cycle and the last one.
The dot-com bubble was funded almost entirely by public capital flowing into companies with no revenue. The largest AI spenders today, Microsoft, Google, Meta, and Amazon, are highly profitable companies funding AI investments with their own cash rather than relying on public markets for survival.
That does not eliminate risk entirely. The AI ecosystem has become deeply interconnected, with chipmakers, cloud providers, model developers, and infrastructure companies all dependent on one another’s success. SpaceX at $2 trillion would become another major piece of that ecosystem.
None of this suggests the technology is overhyped. SpaceX has already achieved extraordinary things, from transforming launch economics to building the world’s largest satellite network.
The question is valuation .A great tech and a great investment are not always the same thing and they are especially not the same thing when every optimistic scenario is already reflected in the price before the company has earned a single dollar of profit from its most expensive bets.
If markets eventually correct, as they always do, the conversation around a $2 trillion valuation may look very different. Sometimes the best investment decision is simply to wait.
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