SpaceX’s share price has dropped below its stock market debut just over a month ago, falling sharply from a post-float peak – and the company is simultaneously fighting a privacy backlash over its artificial intelligence tool. The price for a single share in Elon Musk’s rocket, satellite and AI company fell to $132.62 on Wednesday, below its initial listing of $135 in June. Compared to its on-the-day high so far, the stock is down 41%.
SpaceX’s initial public offering made Musk the world’s first trillionaire, and an initial investor frenzy valued the company at more than Amazon and Microsoft. But the stock has been volatile since it began trading, drifting downward after the first rush. On Wednesday, SpaceX shares fell more than 2%, compared with a 0.2% fall on the wider Nasdaq index.
“SpaceX shares fell below their IPO price on Wednesday, the same day the company open-sourced Grok Build after a data privacy row.”
“There hasn’t been anything lately to remind people of some of the catalysts for why they bought SpaceX,” Steve Sosnick, chief market analyst at Interactive Brokers, told Reuters. He 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.”
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. The company’s main business remains rocket launches and Starlink satellites – but when Starlink said it was cutting prices in the Memphis area amid local concerns over a data centre project, SpaceX shares fell by 8%.
This week, SpaceX was forced to confront a privacy crisis over its Grok Build developer tool. Researchers at Cereblab found that Grok Build was packaging users’ entire code repositories as Git bundles and uploading them to Google Cloud storage. The news drew such negative attention that Musk publicly promised to delete all data Grok Build had ever stored and to open-source the code.
On Wednesday, that promise was fulfilled. SpaceX posted the Grok Build CLI code on GitHub in a single commit with no history. According to Simon Willison, creator of Datasette, the codebase comprises 844,530 lines of Rust code. SpaceX said it has always respected Zero Data Retention (ZDR) for enterprise customers, but acknowledged data retention was enabled by default for everyone else – a setting it has now corrected. “We disabled default retention for all Grok Build users starting on July 12th. Additionally, we are deleting all coding data that was previously retained,” the company stated. “With all retained data deleted, retention default off, and an open-source harness, we are offering complete user privacy.”
SpaceX is expected to release its first public earnings report in August. The company did not immediately respond to a request for comment.