SpaceX Stock Crashes Below IPO Price as Rinehart’s A$700m Gain Evaporates

SpaceX shares closed below their US$135 IPO price on Thursday at US$131.11, marking the eighth loss in nine trading sessions. The collapse has wiped US$903 billion from the company’s peak value reached in mid-June. Australian billionaire Gina Rinehart, whose Hancock Prospecting invested over US$1 billion at the IPO, has lost an estimated A$714 million in paper gains. The selloff raises questions about whether the world’s largest IPO was built on hype rather than fundamentals.

How far has SpaceX fallen from its peak

SpaceX reached a market value of over US$2.6 trillion in the three days after its mid-June debut, briefly making Elon Musk the world’s first trillionaire. The stock peaked at US$225 before collapsing 41% to US$131.11 by Thursday. Market value has fallen to US$1.72 trillion, erasing over US$900 billion in just one month. Musk’s personal fortune dropped from US$1 trillion to US$838 billion as of Thursday, according to Forbes.

Why Australian investors are nursing losses

Hancock Prospecting, Rinehart’s company, bought over US$1 billion worth of SpaceX shares at the IPO price. The stock’s peak at US$225 created a paper gain of roughly US$500 million (A$714 million). Thursday’s close at US$131.11 wiped out most of that gain and cost Rinehart a further US$30 million (A$43 million) on paper. Some Australian institutional investors sold early to lock in profits, but Hancock has not disclosed whether it has sold any shares since listing.

Short sellers are betting heavily against SpaceX

Short sellers have accumulated an estimated US$8.7 billion in paper profit since the IPO, according to Ortex Technologies. About 185 million SpaceX shares are now sold short, representing roughly 29% of the company’s publicly tradable float. Bearish positioning has reached nearly one-third of the public float as the stock hovers near its IPO price. SpaceX’s bonds issued in late June have also sold off sharply, signalling investor concern about the company’s financial health.

The fundamental question investors are asking

SpaceX posted revenue of US$18.7 billion in 2025, up 33% from the prior year, but the company lost US$4.9 billion last year. Starlink, the satellite internet business, accounts for two-thirds of revenue and is the world’s fastest growing telecommunications company. David Brown, a finance professor at the University of Arizona, told ABC News that the core issue is uncertainty: ‘Will it make money, and will it make enough money to make all of this worthwhile?’ SpaceX went public before turning a profit, a rarity for IPOs of this scale.

Final Thoughts

SpaceX’s collapse from US$225 to US$131 in one month shows how quickly IPO euphoria can evaporate when investors focus on fundamentals. With the stock now below its offer price and short sellers holding 29% of the float, the company faces pressure to prove its US$18.7 billion revenue base can translate into profits.

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