SpaceX Shares Sink More Than 50% From Post-IPO High Ahead of First Earnings

From $225 to $113: Why SpaceX Stock is Under Pressure

SpaceX shares have plunged more than 50 percent from their all-time high reached shortly after the company’s historic June 2026 initial public offering. Priced at $135 per share in a $75 billion IPO, the stock surged to $225.64 within days before steadily declining to around $113.50—now trading below its IPO price.

Multiple factors are converging to pressure the stock. The initial euphoria that greeted the listing has cooled as investors shift focus from SpaceX’s long-term ambitions to near-term financial performance. The company’s first earnings report as a public entity, expected on August 4, 2026, is the immediate catalyst, with the market anxious to see whether revenue growth and margins can justify a market capitalisation still hovering near $1.5 trillion.

A second major overhang is the scheduled expiration of insider lock-up restrictions on August 6, just two days after the earnings release. That event could allow early investors and employees to sell shares, potentially flooding the market with additional supply and adding to short-term volatility.

Morgan Stanley analyst Adam Jonas maintains an overweight rating and a $300 price target, arguing that a share price around $100 implies the market assigns zero value to SpaceX’s artificial intelligence business. Jonas values the core space and connectivity operations at roughly $136 per share, with the remainder of his target hinging on AI infrastructure potential. Despite this optimism, the wide gap between bullish and bearish estimates underscores deep uncertainty about how much SpaceX’s future earnings can actually sustain its current valuation.

Behind the Sell-Off: Lock-Up, Valuation, and the Profitability Test

The Lock-Up Overhang

The expiry of lock-up agreements on August 6 is a mechanical but significant risk. With a large pool of pre-IPO shareholders—founders, employees, and early venture backers—suddenly free to sell, the market is braced for a wave of insider transactions. Even if only a fraction of eligible shares are offloaded, the increase in available float can depress the price, especially when sentiment is already fragile. This dynamic has historically contributed to post-IPO corrections in high-profile technology listings, and SpaceX is no exception.

Valuation Reset: From Vision to Earnings

SpaceX is priced as a multi-platform technology titan spanning commercial launch services, Starlink satellite broadband, defence contracts, AI infrastructure, and future deep-space transportation. In the IPO period, investors were willing to pay for that story. Now the market is demanding evidence of profitability and cash flow generation. The correction reflects a broader pattern seen in other high-flying tech IPOs: once the initial hype fades, multiples contract until earnings catch up. For SpaceX, the key question is whether its sprawling businesses can collectively deliver enough revenue growth and margin expansion to support a $1.5 trillion valuation—or whether a longer, painful repricing is unavoidable.

Analyst Conviction Amid Market Caution

Wall Street opinions are split. Morgan Stanley’s Adam Jonas anchors the bull case with a $300 target, insisting the sell-off ignores the value of SpaceX’s AI ambitions. However, even Jonas’s sum-of-the-parts analysis assigns most of the upside to an AI business that remains unproven in terms of standalone earnings. Consensus targets per Investing.com data remain well above the current price, yet the wide dispersion between the highest and lowest estimates reflects profound uncertainty about future cash flows. Until the company reports actual numbers, the gap between narrative and reality will keep the stock vulnerable to further swings.

What Investors Need to See in SpaceX’s First Earnings Report

The upcoming earnings report will be the single most important catalyst. Investors should focus on concrete metrics rather than broad narrative:

• Starlink subscriber growth and average revenue per user (ARPU). Starlink is the most mature and recurring revenue stream; acceleration in net additions and stable or rising ARPU would signal that the satellite broadband business is scaling profitably.
• Launch services profitability. The market needs clarity on the margin profile of frequent Falcon launches—whether higher cadence is boosting operating leverage or simply adding to costs.
• AI infrastructure spending and road map. Any granular detail on capex dedicated to AI compute or data centre buildout will test whether management’s ambitions are backed by immediate investment or remain aspirational.
• Starship milestones. Updates on the next test flight timeline and any progress toward regulatory approvals for orbital missions will directly influence the long-term growth narrative, as Starship underpins both deep-space transport and ultra-high-capacity Starlink deployment.
• Margin and capex guidance. First-time forward guidance on operating margins and total capital expenditure will frame expectations for cash burn and the path to free cash flow generation, directly impacting valuation multiples.
• Insider selling intentions. Management commentary on the lock-up expiration and any planned selling by major holders will help gauge near-term supply pressure, which could extend the stock’s decline or, if limited, provide relief.