SpaceX’s share price has dropped below its stock market debut just over a month after its initial public offering, falling sharply from a post-float peak. On Wednesday, a single share in Elon Musk’s rocket, satellite and artificial intelligence company closed at $132.62, below the $135 listing price in June. The IPO made Musk the world’s first trillionaire, but the stock is now down 41% from its intraday high.
If the price holds or falls further, those who bought around the flotation stand to lose money on their investment. Even in a tumultuous period for tech stocks, SpaceX has taken a particular hit. While the wider Nasdaq index fell 0.2% on Wednesday, SpaceX shares dropped more than 2%.
“SpaceX shares fell below June's IPO price of $135, down 41% from peak, as investor AI hype wanes.”
The stock has been volatile since public trading began a little over a month ago. After an initial investor frenzy that valued the company at more than Amazon and Microsoft, the price has drifted downward. Analysts told the BBC that SpaceX was initially treated as the first chance for ordinary investors to buy into an AI company.
Earlier this year, SpaceX acquired Musk’s AI start-up xAI, recently renamed SpaceXAI, marking its first foray into an AI-focused business. xAI is best known for the controversial chatbot Grok, and through that acquisition, SpaceX leases data centre capacity to other tech companies. However, the company’s main business remains rocket manufacturing and Starlink satellite launches.
When Starlink announced price cuts in the Memphis, Tennessee area amid local concerns over a massive data centre project, SpaceX shares fell by 8%. “There hasn’t been anything lately to remind people of some of the catalysts for why they bought SpaceX,” said Steve Sosnick, chief market analyst at Interactive Brokers.
SpaceX is expected to release its first public earnings report in August. Sosnick added: “The fact that a stock has fallen a couple of dollars below its IPO price in itself is not a tragedy, but SpaceX is heavily watched and has an important role in investor psyche.” SpaceX did not immediately respond to a request for comment.