SpaceX Slides Below IPO Price as Lock-Up Expiry Looms, July 20

SpaceX shares have collapsed to $123, erasing $1 trillion in market value since peaking at $225.64 in late June. The stock now trades below its $135 IPO price just five weeks after the record-breaking $75 billion offering. Investors are bracing for a bigger test: the expiration of lock-up agreements that will release hundreds of millions of shares onto the market, potentially crushing the scarcity premium that supported the post-IPO rally.

Why the stock crashed so hard so fast

SpaceX priced at $135 on June 12 and surged to $225.64 before reversing sharply. The collapse reflects three pressures: a valuation reset as investors question whether the company can justify its 45x 2026 sales multiple, Starship V3 rocket launch delays, and concerns over profitability. SpaceX lost $4.94 billion in 2025 despite 33% revenue growth to $18.67 billion. The company trades at a premium that assumes revenue will reach $178 billion by 2035, far above current levels.

Lock-up expiry is the bigger threat ahead

Only 4% of SpaceX shares were available for trading at IPO, creating artificial scarcity that fueled the price spike. When lock-up agreements expire in the coming weeks, hundreds of millions of additional shares become eligible for sale. This supply flood could crush the scarcity premium. Insiders and early investors will have the ability to sell, potentially triggering cascading losses as the market absorbs the new float.

Elon Musk’s net worth tumbled with the stock

Musk’s wealth fell from $1.4 trillion to roughly $800 billion as SpaceX lost $1 trillion in market value. He remains the world’s richest person despite the collapse. Short sellers have grown aggressive, betting the stock falls further. Analysts still target $237.78, implying 93% upside, but execution risk is high given Starship delays and negative cash flow.

What the numbers say about valuation

SpaceX’s only profitable segment is Starlink, which generated $11.39 billion in 2025 revenue with a 63% EBITDA margin and grew subscribers from 4.5 million to 10.3 million. The Space segment (Falcon 9 launches and Starship development) turned profitable in 2025 after 130 missions at $67 million to $97 million each. However, the company’s 45x sales multiple leaves no room for error. Investors are paying for a future where Starship becomes fully reusable and Starlink dominates global satellite internet.

Final Thoughts

SpaceX’s crash from $225 to $123 in five weeks reflects a harsh reality: the IPO priced in perfection, and the market is now repricing for risk. Lock-up expiry will test whether the stock can hold above $135 or slide further. For Hong Kong investors, the volatility is a reminder that even record-breaking IPOs can reverse sharply when fundamentals don’t match the hype.

FAQs

Why did SpaceX stock fall 45% so quickly after the IPO?

Investors reassessed the 45x sales valuation as too expensive, and Starship launch delays raised execution concerns. The stock was also supported only by artificial scarcity of the 4% float.

What is lock-up expiry and why does it matter for SpaceX?

Lock-up expiry allows insiders and early investors to sell their shares. When hundreds of millions of shares flood the market, the scarcity premium that supported the rally will likely collapse.

Is SpaceX still profitable?

No. SpaceX lost $4.94 billion in 2025. Only Starlink is profitable with a 63% EBITDA margin. The Space segment turned profitable in 2025 but the company burns cash overall.

What do analysts think SpaceX stock is worth?

Analysts target $237.78 per share on average, implying 93% upside from current $123 levels. However, this assumes flawless execution of Starship and Starlink expansion.

Disclaimer:
The content shared by Meyka AI PTY LTD is solely for research and informational purposes. Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.

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Huzaifa Zahoor

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