SpaceX Targets US$1.77 Trillion Valuation

Elon Musk’s SpaceX has bypassed a traditional price range for its initial public offering (IPO), setting a fixed price of US$135 per share to target a US$1.77 trillion valuation.

In an updated prospectus filed with the US Securities and Exchange Commission on May 20, the company outlines plans to sell 555.6 million shares. The offering is set to raise US$75 billion, making it the largest US market debut on record and eclipsing Alibaba Group Holding's (NYSE:BABA) 2014 listing.

Assuming the closure of pending transactions involving EchoStar and Cursor, SpaceX's US$1.77 trillion market capitalization would make it the seventh most valuable public company in the US.

That would place the firm above Tesla's (NASDAQ:TSLA) US$1.6 trillion valuation.

SpaceX currently operates three distinct business lines: its core orbital launch infrastructure, its profitable satellite internet provider Starlink and its newly consolidated artificial intelligence (AI) arm, xAI.

SpaceX absorbed xAI in a February all-stock merger that valued the combined entity at US$1.25 trillion.

While Starlink generated US$3.26 billion in the most recent quarter and accounted for 69 percent of total revenue, the company overall remains unprofitable. SpaceX recorded a net loss of US$4.28 billion in the latest quarter, following a US$4.94 billion loss for the full 2025 year.

The deficit is driven primarily by the xAI unit, which posted a US$2.5 billion quarterly loss, while the core space division reported a US$619 million operating loss. The company holds a US$41.3 billion accumulated deficit.

SpaceX explicitly states in its S-1 filing that it has “a history of net losses and may not achieve profitability in the future." It expects to incur spend significant capital to develop untested technologies before its AI products become profitable.

Equity analysts have flagged the valuation multiple and the AI unit's cash burn as immediate risks.

Morningstar issued a discounted cashflow valuation of US$780 billion, roughly 48 percent below the private market valuation, citing xAI as an "indeterminate" economic moat.

“We think the company has been significantly overvalued and investors will have opportunities to buy the stock at more attractive levels after the IPO,” analysts at the firm wrote.

Despite the valuation concerns, the structure of the offering and index mechanics are expected to drive immediate demand. Musk will retain over 82 percent of voting power through a super-voting share class on roughly 42 percent of the equity. The firm has also reserved up to 5 percent of the IPO stock for a direct share program for specific employees.

The S-1 filing details expanding related-party transactions and cross holdings between SpaceX and Tesla. Tesla currently holds 18.99 million SpaceX shares valued at US$2.56 billion at the IPO price. Concurrently, SpaceX’s xAI unit purchased US$269 million in Tesla megapacks in April, following US$430 million in similar purchases last year.

“We have historically collaborated with Tesla through commercial, licensing, and support agreements,” the filing states, aligning with previous reports earlier this year that Musk has discussed merging the two companies internally.

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Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.