CEO of SpaceX and Tesla, South African-Canadian-US businessman Elon Musk speaks during the World Economic Forum (WEF) annual meeting in Davos on January 22, 2026.
Fabrice COFFRINI/AFP via Getty Images
Elon Musk became the world’s first trillionaire on June 16. By August 1, he was poorer than he was the day SpaceX priced its IPO. The Bloomberg Billionaires Index put his net worth at $684 billion — below where it stood before the largest public offering in history began trading, with $649 billion in paper wealth erased in just over six weeks. That decline exceeds the entire net worth of every other person who has ever appeared on Bloomberg’s list of the world’s 500 richest people — with the sole exception of Musk himself.
The rout has a specific cause and a specific clock. SpaceX shares (Nasdaq: SPCX) are down 46% from their June 16 intraday high of $225.64, closing at $108.37 on July 31 — roughly 20% below the $135 IPO price. Tesla has compounded the damage, falling 17% since its July 22 second-quarter earnings report and sitting 36% below its December high. On Tuesday, August 4, SpaceX is scheduled to release its first quarterly earnings as a public company. Two days later, on August 6, as many as 911.5 million previously restricted shares will become eligible to trade — a supply event larger than SpaceX’s entire existing public float.
SpaceX IPO Turned Musk Into a Trillionaire. Then the Reboot Began.
When SpaceX began trading on June 12, 2026, it raised $75 billion at a $1.75 trillion valuation — the largest IPO in history, surpassing Saudi Aramco’s 2019 debut by more than two and a half times. Shares opened at $160, above the $135 IPO price, and climbed steadily through the week. By June 16 — four days after listing — SPCX had reached an intraday high of $225.64, pushing Musk’s total net worth to approximately $1.33 trillion and making him the first person in history to cross the $1 trillion threshold.
The euphoria evaporated quickly. Concerns about SpaceX’s heavy losses — the company posted a $4.9 billion net loss on $18.7 billion in revenue for 2025, and burned an additional $4.28 billion in the first quarter of 2026 — combined with a debt load that grew to $25 billion after the company placed its inaugural bond offering in late June. Morningstar analyst Nicolas Owens has maintained a fair value estimate of $62 per share, roughly one-tenth of the June peak and still below the current trading price — reflecting his assessment that the stock remains significantly overvalued at any multiple near the IPO price.
The company’s revenue model is built on three divisions with fundamentally different financial profiles. Starlink, the satellite internet business, generated $11.4 billion in revenue and approximately $4.4 billion in operating profit in 2025, making it the only profitable segment and the cash engine that funds everything else. The Space segment — Falcon 9 launches, NASA contracts — generated $4.1 billion in revenue but ran at an operating loss, largely due to ongoing Starship development costs. The AI segment, reflecting the February 2026 all-stock acquisition of Musk’s xAI, generated $3.2 billion in 2025 but posted a $6.35 billion operating loss for the year, and lost an additional $2.47 billion in just the first quarter of 2026. Every dollar Starlink earns is effectively being redistributed to two money-losing divisions.
What the Lock-Up Release Actually Means: More Supply Than the Entire Existing Market
SpaceX’s lock-up structure is unlike the standard 180-day cliff used by most IPOs. Instead, the company engineered a staggered release tied to earnings windows, fixed-date milestones, and price triggers — designed, according to the company’s prospectus, to avoid a single catastrophic supply event. The first release is scheduled for August 6, two days after the first earnings report.
The number of shares involved makes the design intent clear. At most 911.5 million shares will become eligible to trade on August 6, representing 20% of the insider-held block subject to the standard 180-day lock-up. At SPCX’s July 31 closing price of $108.37, those shares are worth approximately $98.8 billion — more than the $75 billion SpaceX raised in its IPO.
More importantly: those 911.5 million shares exceed SpaceX’s current tradable float of approximately 640 million shares, which represents only about 5% of the company’s total shares outstanding. According to S3 Partners, the August 6 release will lift SpaceX’s publicly tradable float from approximately 4.9% of total shares to approximately 11.8% — more than doubling available supply in a single day. An expiration does not mean all eligible holders will sell; it removes the contractual restriction. But the stock is already trading at a price that puts every investor who bought at or above the $135 IPO price at a loss, creating structural motivation to exit.
A performance-contingent bonus tranche — an additional 10% of restricted shares, or roughly 455.8 million more — would also have released if SPCX had traded at least 30% above its $135 IPO price (a $175.50 threshold) for five of the ten preceding trading sessions. That threshold has not been met. The bonus tranche will not release on August 6.
Musk’s own approximately 6.4 billion shares in SpaceX are subject to a separate 366-day lock-up agreement that does not expire until June 12, 2027. The price pressure on August 6 will come from other insiders and early investors — not from Musk himself, who has no ability to sell into any of the unlock events through next summer.
Short Sellers Are Betting the Unlock Will Win
As of July 29, 219.3 million SpaceX shares were held short — equal to approximately 34% of the shares currently available for public trading, according to analytics firm S3 Partners. That bearish position is worth $24.6 billion in notional value and exceeds the total short position against Tesla, the other major publicly traded company led by Musk.
Short interest has risen from 23.3 million shares on June 16 — the day SPCX hit its all-time high — to 219.3 million in just over six weeks. The mechanism is straightforward. Short sellers borrow shares and sell them, betting on a price decline; when a positive catalyst arrives (or doesn’t), they either profit or are forced to cover by buying back — the latter scenario creating upward price pressure known as a short squeeze.
“The big bet right now is on the unlock and effectively that there won’t be anything announced on earnings that will overcome the volume of unlocked shares coming to market,” said Sam Pierson, director of research at S3 Partners, commenting on the bearish concentration.
The mechanics create a binary setup for the week of August 4. If SpaceX’s earnings fail to surprise significantly to the upside, short sellers profit from a declining stock and the lock-up adds further selling pressure, potentially compounding the decline. If earnings deliver a genuine positive surprise — strong AI-segment revenue recognition, an acceleration in Starlink subscriber growth, or guidance that validates the H2 revenue ramp Wall Street is counting on — those 219.3 million shorted shares would need to be bought back, adding mechanical upward pressure on a still-thin float. Cathie Wood’s ARK Invest appeared to be positioning for the latter outcome, purchasing approximately $21.3 million in SPCX shares on July 22.
Starship Succeeded. The Stock Didn’t Notice.
The market’s indifference to actual engineering progress has been one of the more striking features of SpaceX’s post-IPO trading. On July 24, SpaceX successfully launched Starship Flight 13 from its Starbase facility in South Texas — the 13th test flight of the program and the first since the IPO. The mission deployed 20 Starlink V3 satellites, the first operational V3 deployment in history, and demonstrated meaningful improvements in the vehicle’s heat shield performance.
The flight was not without issues. The Super Heavy booster’s landing burn experienced a partial engine failure — only 10 of the 13 scheduled engines ignited — resulting in a hard ocean splashdown rather than the controlled catch that SpaceX is developing. The successful orbital deployment was preceded by an abort on July 16, when four of the 33 Raptor-3 engines on the Super Heavy booster failed to ignite before liftoff.
The full rapid reusability that the highest analyst price targets require — the “airline-like turnaround economics” that justify Raymond James’s $800 per share target — was not demonstrated. UBS does not expect a booster tower catch attempt until Flight 15 at the earliest. The stock declined after the successful launch just as it had declined before it.
Tesla Made Things Worse
SpaceX’s slide has been amplified by Tesla, where Musk owns stock valued at approximately $129 billion. Tesla shares fell 17% following the July 22 second-quarter earnings report, in which the company disclosed $5.8 billion in capital expenditures — what Musk described as “a massive capex year” — and recorded its first cash-negative quarter in two years. Tesla also projected it would spend more than $25 billion on capital expenditures for the full year. The stock now sits approximately 36% below its December 2025 high.
Investors are weighing a tension at both companies simultaneously: each is burning capital at extraordinary rates to pursue long-horizon bets — autonomous robotaxis, humanoid robots, Starship’s orbital infrastructure — while near-term financial results reflect that spending before it produces revenue. Morgan Stanley’s bull case for SpaceX projects the company will burn an average of $84 billion per year between 2027 and 2034, with capital expenditures peaking at $300 billion in 2031 and positive free cash flow not arriving until 2035.
What the Earnings Call Will and Will Not Answer
When SpaceX reports on Tuesday, August 4, it will file its first mandatory quarterly 10-Q with the SEC — the first time markets will see the company’s financials in a fully audited, standardized public-company format. The headline revenue number is expected to land near the analyst consensus of approximately $6.87 billion, but that figure alone will not tell investors what they most need to know.
The real test is whether management can show the beginning of the H2 revenue acceleration that full-year forecasts require. Three major banks project 2026 revenue ranging from approximately $38 billion to more than $50 billion, but SpaceX’s first-half revenue adds up to only roughly $11.56 billion at the consensus estimate. Reaching even the most conservative full-year target requires the second half to generate more than double the first half’s pace.
The primary driver of that acceleration is AI compute leasing — renting SpaceX’s xAI data center capacity to large AI companies. Anthropic signed a contract in May 2026 to pay $1.25 billion per month for exclusive access to SpaceX’s Colossus 1 data center in Memphis, which houses approximately 220,000 to 325,000 Nvidia GPUs. That contract’s first two months of revenue will appear in the Q2 results. Google’s Alphabet, however, signed a separate agreement to pay approximately $920 million per month for access to roughly 110,000 GPUs — but that contract does not start until October, meaning no meaningful Google compute revenue will appear Tuesday. The H2 revenue ramp the market is banking on depends largely on a contract that has not yet started flowing.
Governance is also on the table. SpaceX’s dual-class share structure gives Musk approximately 85% of total voting power through his Class B super-voting shares. Public shareholders who own the profitable Starlink and launch businesses have no practical mechanism to redirect capital away from xAI spending if that bet proves larger than the market can support. HSBC flagged this in its July 25 initiation report, assigning a Hold rating with a $115 price target and projecting $106 billion in cumulative cash burn before the company reaches positive free cash flow.
What Comes Next After the Lock-Up
SpaceX has engineered further releases beyond August 6. Subsequent tranches of approximately 7% of the insider-held block are scheduled to release roughly every two weeks through October, with a substantially larger tranche tied to the third-quarter earnings release in late October or November. The full standard 180-day lock-up for employees and early investors expires on approximately December 8–9, 2026. Musk’s personal lock-up does not expire until June 12, 2027.
Separately, S&P 500 inclusion — which would bring a second wave of forced index-fund buying similar to the $4.3 billion Nasdaq-100 inclusion in July — remains at least until mid-2027 under current seasoning rules. And rumors of a potential Tesla-SpaceX merger have circulated without confirmation, though such a combination would have significant implications for S&P index eligibility and governance.
Wall Street analysts hold a wide range of views. The average 12-month price target across covering analysts is approximately $236.71, with a range from Morningstar’s $62 to Raymond James’s $800. HSBC, initiating coverage in late July, set the lone post-IPO Hold rating at $115 — below even the current price — while Bernstein maintained its Outperform rating and $239 target following the Flight 13 results. None of these estimates is investment advice; each reflects a specific set of assumptions about an unresolved set of business outcomes.
Musk remains by a wide margin the wealthiest person on Earth. But the speed of the reversal — from history’s first trillionaire to below the pre-IPO baseline in six weeks — illustrates how completely his fortunes have become anchored to a single, freshly public, structurally illiquid stock operating in a market that has not yet decided what SpaceX is worth.
Frequently Asked QuestionsWhy is Musk’s net worth now lower than before SpaceX’s IPO?
SpaceX shares (SPCX) have fallen approximately 46% from their June 16 intraday high of $225.64, landing at $108.37 as of July 31 — about 20% below the $135 IPO price. Since SpaceX stock represents the dominant component of Musk’s wealth (his SpaceX position is valued at more than $550 billion even at current prices, while his Tesla stake is worth approximately $129 billion), the decline in SPCX has pushed his total net worth, as tracked by the Bloomberg Billionaires Index, back below the level it stood at when the IPO priced in June. Tesla’s own 17% post-earnings decline has added to the pressure.
What happens when SpaceX’s lock-up expires on August 6?
On August 6, as many as 911.5 million shares held by SpaceX insiders and early investors will become eligible to trade for the first time — a number that exceeds SpaceX’s current entire tradable float of approximately 640 million shares. This does not mean all holders will sell; it removes the contractual restriction on selling. But S3 Partners estimates the float will more than double, rising from roughly 4.9% of total shares outstanding to approximately 11.8%. The question for the week of August 4 is whether strong earnings can generate enough buying demand to absorb that new supply.
Why does such heavy short selling matter for someone who owns SPCX?
Short sellers have borrowed and sold approximately 219.3 million SPCX shares as of July 29 — equal to about 34% of the tradable float. This creates two possible outcomes. If the company’s August 4 earnings disappoint, short sellers profit and the lock-up supply adds downward pressure, potentially accelerating the decline. If earnings deliver a surprise strong enough to shift sentiment, those 219.3 million shorted shares must be bought back at whatever price — adding mechanical buying pressure that can push the stock sharply higher regardless of the underlying business news. This dynamic is known as a short squeeze. Neither outcome is guaranteed, and this is not investment advice.
Can Musk sell his SpaceX shares to stop the losses?
No. Musk’s approximately 6.4 billion SpaceX shares are subject to a separate 366-day lock-up agreement that does not expire until June 12, 2027. He cannot sell into any of the unlock tranches — including August 6, the subsequent bi-weekly releases, or the large Q3-earnings tranche — until next summer. His paper losses are real on Bloomberg’s mark-to-market basis but entirely illiquid for now.