SpaceX prepares for $75 billion IPO amid high-stakes moonshots

SpaceX is coming to market on Friday with a $75 billion stock offering that is reportedly over-subscribed, with some institutional investors buying blocks of $10 billion. The company is currently losing money, but investors are eager to back the firm, which holds a near-monopoly on access to space in the U.S. and Europe. However, independent financial analysts are significantly more conservative than the company’s bankers:

• SpaceX’s bankers assess the company’s value at nearly $1.8 trillion.
• Aswath Damodaran, a New York University finance professor, suggests the company is worth $1.2 trillion.
• Morningstar, a financial research firm, assigns a value of about $825 billion, calculating a fair value of $63 per share compared to the offering price of $135 per share. Morningstar characterizes the difference as a $72 call option on the company’s ability to deliver orbital data centers.

To justify its valuation, SpaceX’s financial plans rely on three near-impossible feats of engineering: a reusable rocket, a brand-new American chip foundry called Terafab, and a sprint to build satellites faster than ever before. Currently, the Starlink satellite production rate is 70 a week. To reach its goals, the company would need to scale production to 556 satellites per month, or 6,666 satellites per year. This expansion is complicated by technical and regulatory hurdles. The Federal Aviation Administration (FAA) is conducting a mishap investigation into SpaceX’s Starship booster stage, while NASA, which has a nearly $4 billion contract with SpaceX to use Starship as a moon lander, is not ready to commit to a test mission with the vehicle scheduled for late 2027.

The company’s AI business is its most uncertain aspect. In its S-1 (an SEC registration document), SpaceX frames enterprise AI as its largest opportunity, assessing the total market at $22.7 trillion, compared to $2.4 trillion for AI infrastructure and just under $2 trillion for space efforts. The company plans to target this market through Macrohard, a project to equip digital agents with white-collar capabilities, and by acting as a neocloud (a new cloud computing provider) for compute customers like Anthropic and Google.

Musk’s vision centers on orbital data centers, which emerged in the last 18 months. “This is not a promise of what we’ll do. This is what we are going to try to do, and think we probably can do, which is to get to roughly an annualized rate of a gigawatt per year by the end of next year, in terms of space AI compute,” Musk, the CEO of SpaceX, said. This assumes an expected maximum power delivery of 150 kW per satellite, despite Musk’s erratic online behavior and his recent lawsuit against Sam Altman.

Why it matters

SpaceX’s $75 billion stock offering hinges on its ability to execute three near-impossible engineering feats—orbital data centers, reusable rockets, and domestic chip manufacturing—to justify its valuation.