Elon Musk, CEO of SpaceX. AFP/Yonhap News
Shares of space and aerospace company SpaceX, the largest initial public offering (IPO) in history, have fallen below their offering price just one month after listing. During this period, SpaceX’s market capitalization, which had started as the fourth or fifth largest on the New York Stock Exchange overall, also dropped by 1,500 trillion won.
On the 17th (local time), SpaceX closed at $123.99 on the New York Stock Exchange, down 5.43% from the previous trading day. It marked the sixth consecutive session of decline since the 10th of this month. SpaceX’s market capitalization fell to $1.6316 trillion, evaporating more than $1 trillion (about 1,500 trillion won) from its record high of $2.64 trillion set on the 16th of last month. SpaceX’s shares first fell below the offering price ($135) during intraday trading on the 15th of this month, and have closed below the offering price since the 16th.
SpaceX slumped just one month after listing because market concerns over its artificial intelligence (AI) investment are intensifying amid its massive debt. As more investors bet on a share price decline, the stock has become a concentrated target of short-selling forces from the early stages of its listing. In addition, the abrupt halt the previous day of the 13th test flight of Starship, SpaceX’s next-generation core spacecraft, further fueled the additional decline in the share price. Starship is a super-heavy launch vehicle 124 meters tall developed by SpaceX.
The fact that SpaceX will release its first earnings after listing around the 5th or 6th of next month is also a major negative factor. The lockup on a significant portion of SpaceX’s institutional shares will be lifted starting the second trading day after the earnings announcement. That volume alone is estimated to exceed 900 million shares.
Earlier, SpaceX raised a total of $85.7 billion (about 130 trillion won) through the largest IPO in history on the 10th of last month. SpaceX then issued $25 billion (about 38 trillion won) worth of corporate bonds to repay debt on the 23rd of the same month, placing further pressure on its share price.