SpaceX shares fell 11% in pre-market trading Wednesday even after the company's first earnings report as a public company beat Wall Street's revenue forecasts. Investors instead focused on $18.4 billion in quarterly capital spending and a major insider-share lockup expiring Thursday, which could increase the stock's public float.
SpaceX shares dropped 11% in pre-market trading Wednesday, even as the company's first earnings report since going public beat Wall Street's revenue forecasts. The stock had climbed roughly 10% on earnings day before giving back those gains — a slide that could be partly mechanical, as a large tranche of insider shares neared eligibility for sale.
Revenue surges, but so does spending
Revenue rose 92% from a year earlier to $7.8 billion, beating estimates. Adjusted EBITDA nearly tripled to $3.5 billion. The company narrowed its net loss to $541 million. It spent $18.4 billion during the quarter expanding Starlink, Starship and its AI infrastructure. That spending was up from roughly $10 billion the prior quarter and $2.8 billion a year earlier, and CFO Bret Johnsen told analysts capex would hold at similar levels for the next two quarters.
JPMorgan flags years of heavy capex
JPMorgan raised its price target to $240 from $225. The bank warned capital spending could reach nearly $200 billion in both 2027 and 2028, pressuring free cash flow. Raymond James held a Street-high $800 price target, arguing operating performance remains strong. That optimism holds even as SpaceX carries a $1.77 trillion market cap.
Insider lockup adds supply pressure
A large block of insider shares becomes eligible for sale Thursday. Under SpaceX's registration statement, 20% of insider-held shares unlock two trading days after the earnings report. JPMorgan put that count at 911.5 million shares, which could lift the public float by 143%. That share tranche would have expanded to 30% had the stock traded at least 30% above its $135 IPO price; it remains well below that level.
Bitcoin holding adds earnings volatility
SpaceX also held all 18,712 bitcoin on its balance sheet through the quarter. The position was worth about $1.1 billion at the end of June. The holding lost roughly $195 million in value during the quarter, adding volatility to earnings under fair-value accounting rules.
CEO Elon Musk told analysts he expects SpaceX to reach a $100 billion annual revenue run rate by December. He also guided for $1 trillion in annual revenue by 2030, a year ahead of the company's previous guidance. He pointed to Starmind AI satellites built with Nvidia's Vera Rubin chips, expected to begin launching next year, as part of a push toward closer to 10 gigawatts of compute capacity by the end of 2027.
Sources: CoinDesk, The Motley Fool
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