SpaceX stock tumbled below its $135 initial public offering price for the first time on July 15, marking a sharp reversal from the company’s blockbuster debut just over a month earlier, according to Reuters and NBC News. Shares dropped as low as $132.28 before closing at $135.27, erasing the gains from an extraordinary post-IPO rally that had propelled the rocket maker to a peak of $225.64 on June 16.
The decline represents a stunning turnaround for Elon Musk’s space company, which completed the world’s largest IPO ever when it priced 555.6 million shares at $135 on June 12, raising roughly $75 billion at a $1.77 trillion valuation, according to CNBC and Reuters. In the first four trading days, shares surged 66%, briefly making SpaceX the fifth-largest company by market value—ahead of Amazon and Meta—before enthusiasm cooled.
Analysts point to multiple forces driving the retreat. Dominic Pappalardo, chief multi-asset strategist at Morningstar Wealth, told ABC News that roughly 5% of the company’s shares made their way onto the public market, meaning intense investor demand collided with a severely limited supply, artificially inflating the price. “Some of that demand has subsided, and you see the price falling precipitously along with that,” Pappalardo said.
Justus Parmar, CEO of SpaceX investor Fortuna Investments, attributed the weakness to liquidity-seeking insiders. “I think the elephant in the room is there’s a lot of folks that are in the stock and maybe some of them or a good number of them are wanting to take some liquidity, which is essentially putting a lot of pressure on the stock,” Parmar told Reuters. Lock-up expiration—allowing employees and early shareholders to sell—is expected to begin after the company’s first earnings report, likely in early August, potentially adding further selling pressure.
The broader market environment also weighed on the stock. Reuters reported that investor concern over debt-funded AI spending and potential Federal Reserve rate hikes pressured stretched tech valuations. SpaceX itself raised $25 billion in bonds in late June to fund technology infrastructure, becoming one of many tech giants betting heavily on artificial intelligence development.
Starship Delay and Valuation Questions
A Starship test flight abort on July 16 accelerated the decline. SpaceX scrubbed its 13th Starship test launch after at least two Raptor engines on the Super Heavy booster failed to ignite, according to Spaceflight Now. The delay fed investor concerns about the company’s ability to execute on ambitious plans, with the stock falling more than 3% in extended trading after the abort, according to CNBC.
The retreat has also drawn scrutiny to SpaceX’s financial fundamentals. The company reported revenue of $18.7 billion in 2025, up 33% year-over-year, but posted a loss of $4.9 billion, according to SEC filings cited by ABC News. David Brown, a finance professor at the University of Arizona, highlighted the tension: “Will it make money, and will it make enough money to make all of this worthwhile?” he told ABC News.
Still, the stock’s decline from its peak remains significant. As of July 16, shares stood roughly 40% below the June 16 high, according to ABC News, though analysts remain divided on the company’s long-term prospects. Some point to Tesla’s 81% five-year gain as evidence that Musk-led ventures can deliver shareholder value despite early losses, while others remain skeptical of moonshot initiatives like orbital data centers.
Sources
- Reuters — SpaceX shares dropping below IPO price, profit-taking, debt concerns, lock-up expiration timing, and analyst commentary from Justus Parmar
- NBC News — SpaceX stock closing below IPO price for the first time
- CNBC — IPO pricing details and Starship abort impact on stock
- ABC News — Analyst commentary from Dominic Pappalardo and David Brown, limited float dynamics, revenue and loss figures, stock decline magnitude
- Spaceflight Now — Starship Flight 13 abort details and engine failure
- SmartAsset — Post-IPO peak price of $225.64
