Just over a month after SpaceX’s stock market debut made Elon Musk the world’s first trillionaire, the share price has fallen below its initial listing, wiping billions from the company’s value.
A single share in Musk’s rocket, satellite and artificial intelligence company closed at $132.62 on Wednesday, down from the $135 float price in June. Compared with its post-float peak, the stock is now down 41%. Investors who bought around the time of the flotation now risk losing money on their holdings.
“SpaceX shares fell below $135 IPO price, down 41% from peak, as initial AI hype fades.”
The slide comes as technology stocks have faced a tumultuous few weeks. But SpaceX has taken a particular hit: while the wider Nasdaq index fell 0.2% on Wednesday, SpaceX’s shares dropped more than 2%. The company’s stock has been volatile since it began trading on the public market a little over a month ago.
Initially, investors treated SpaceX as the first chance to buy into an AI company, according to analysts who recently spoke to the BBC. That enthusiasm drove a frenzied first few days of trading, which valued the company at more than Amazon and Microsoft. But the price has drifted downward ever since.
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. Through that acquisition, SpaceX now leases data centre capacity to other tech companies.
The company’s main business remains the manufacture and launch of rockets and its Starlink satellite telecommunications network. But even that core operation has caused concern: when Starlink said it was cutting prices in the Memphis, Tennessee area amid local worries 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,” Steve Sosnick, chief market analyst at Interactive Brokers, told Reuters. “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 is expected to release its first public earnings report in August, a moment that could either restore confidence or deepen the sell-off. The company did not immediately respond to a request for comment.