IPOs can be volatile, especially for retail investors. SpaceX is no exception.
Various photographs/Adobe StockI just did a quick Google search for SpaceX IPO. How many hundreds of articles are we really supposed to read about this?
Given the buzz around Friday’s big IPO, there are a few misconceptions worth addressing up front. Although many people consider SpaceX to be a massive and dominant space company, the situation is more complicated than that.
“In reality, it’s a very successful but fairly small satellite launch company, backed by a stagnant, losing social media company and a money-burning AI company, then sprinkled with a lot of hype about humanity’s move to interplanetary,” said Robin Wigglesworth, editor of the Financial Times’ financial blog Alphaville.
In other words, it may be more like a vertically integrated space and communications company with ambitious, high-risk side bets. Of course, at its core, SpaceX is a launch company that designs rockets (like Falcon 9 and Starship) and sells access to space. But around that, it has these related businesses — including Starlink, its satellite internet network, and xAI, which SpaceX acquired in February 2026. And because xAI includes the X social media platform and X’s chatbot, Grok, they’re also under the SpaceX umbrella.
X has not been sustainable in terms of revenue. And, like most cash-burning AI companies, xAI is expensive to run and makes very large losses.
You could say that the SpaceX ecosystem revolves around a single goal: building the infrastructure necessary for global connectivity and, ultimately, space colonization. But a major concern is that SpaceX’s overall package is driven more by hype and momentum than by its proven profitability.
Wigglesworth said the biggest immediate risk is simple: The stock could fall shortly after trading begins. This outcome would affect both the company and investors, although it would not necessarily be a sign of broader economic problems. As he pointed out, IPOs “do poorly all the time.”
During the first few weeks after the IPO, price movements can be misleading. The opening day could be volatile, with banks helping to stabilize prices and strong retail demand potentially pushing stocks higher. We’ll also see index funds start to buy in, which may help push the price up a bit.
However, as Wigglesworth pointed out, the most significant test will come after a month, when the market will determine whether there is sustained demand “for a company whose shares are trading at some of the juiciest valuation multiples we’ve seen in history.”
So here’s another misconception to combat: if SpaceX is popular, it’s safe to buy, right?
I didn’t need to read too many articles to get an answer to this question.
“Popularity and fame are poor indicators of investment success,” Wigglesworth told me. “Even good companies can be bad investments at a stupid price.”
