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SpaceX’s S-1 rebrands it as an AI infrastructure company, with Starlink’s $4.4 billion operating profit subsidizing a $6.4 billion AI segment loss.<\/p>\n<\/li>\n
SpaceX holds an option to acquire Cursor, an AI coding tool at $3 billion in annualized revenue, for $60 billion payable in stock.<\/p>\n<\/li>\n
The analyst who called NVIDIA in 2010 just named his top 10 AI stocks. Get them here FREE<\/a>.<\/p>\n<\/li>\n<\/ul>\n Few IPOs in history have generated as much excitement as SpaceX<\/b>‘s planned June 12 debut on Nasdaq under the ticker SPCX. The company is targeting a valuation of $1.75 trillion, putting it in the top 10 largest companies in the world by market cap — above Tesla<\/b>‘s (NASDAQ:TSLA<\/a>) current $1.57 trillion and within striking distance of Broadcom<\/strong>‘s (NASDAQ:AVGO<\/a>) $1.9 trillion valuation. <\/p>\n But buried inside the company’s recently amended S-1 filing with the SEC was a revelation that may be even more important than the IPO itself. SpaceX is no longer presenting itself primarily as a rocket company.<\/p>\n Instead, it is increasingly describing itself as an artificial intelligence services and infrastructure company. That distinction could have major implications for investors — including making a previously disclosed acquisition option far more likely.<\/p>\n SpaceX Isn’t the Company You Think It Is <\/p>\n Let’s start with the identity shift, because it’s the most important thing in the prospectus that most investors are glossing over.<\/p>\n SpaceX’s S-1 no longer describes the company as a launch vehicle or rocket business. It now calls itself an “AI services and infrastructure company.” That’s not marketing language — it reflects a genuine structural transformation.<\/p>\n Following the February acquisition of xAI and its subsidiary X, SpaceX fully consolidated them into its financials. SpaceX generated $18.7 billion in total revenue in 2025, but posted an operating loss of $2.6 billion. The culprit? The AI segment lost $6.4 billion on $3.2 billion in revenue, while the Connectivity segment — driven almost entirely by Starlink — earned $4.4 billion in operating profit on $11.4 billion in revenue, growing 49.8% year over year. In short, a profitable satellite internet business is subsidizing one of the largest AI buildouts on the planet.<\/p>\n The analyst who called NVIDIA in 2010 just named his top 10 stocks. Get them here FREE<\/a>.<\/p>\n Investors who buy SPCX expecting a pure-play space company are buying something very different.<\/p>\n 24\/7 Wall St.<\/p>\n More than a rocket launch, it\u2019s an AI revolution. SpaceX\u2019s $1.75 trillion IPO strategy reveals a high-stakes pivot that leaves traditional aerospace\u2014and even Tesla’s market cap\u2014in the dust. \u00a9 24\/7 Wall St.<\/p>\n Story Continues <\/p>\n The $60 Billion Question Most Analysts Are Ignoring <\/p>\n Much of the speculation surrounding a post-IPO acquisition has focused on Tesla. Elon Musk controls both companies, and investors have long imagined some form of combination. But the filing points more directly toward Cursor.<\/p>\n In April, SpaceX announced a compute-and-option agreement with Anysphere<\/b>, the company behind Cursor, the AI coding tool that has become the go-to development environment for a generation of software engineers. The S-1 discloses that SpaceX holds the right to acquire Cursor at an implied equity value of $60 billion, payable in Class A shares. Alternatively, SpaceX can pay $10 billion for joint development work — and if it doesn’t exercise the acquisition option by year-end, it owes the $10 billion as a breakup fee either way.<\/p>\n Why does this matter? Because Cursor is not a niche product. The company reached $3 billion in annualized revenue by May and is the most credible challenger to GitHub Copilot, Microsoft<\/b>‘s (NASDAQ:MSFT<\/a>) competing AI coding tool, which commands roughly 37% market share.<\/p>\n That said, the $60 billion acquisition isn’t a done deal. The structure gives SpaceX flexibility, and with $29.1 billion in total debt — including a $20 billion bridge loan that must be repaid within six months of the IPO closing — management may prefer to keep the $10 billion partnership path open and preserve cash for debt service. The $10 billion collaboration fee is real money, but it’s a much smaller commitment than swallowing a $60 billion all-stock deal that would immediately dilute new shareholders.<\/p>\n Granted, if SpaceX’s stock holds its IPO valuation and the Colossus-Cursor partnership demonstrates traction, the full acquisition becomes more compelling. The S-1’s broader language around acquisitions and divestitures suggests the Cursor deal is a template, not a one-off.<\/p>\n Key Takeaway <\/p>\n SpaceX is a genuinely extraordinary business. Starlink is one of the most profitable connectivity networks, and the Cursor option is a strategic signal that deserves respect. But this IPO asks investors to pay for a vision — AI infrastructure in orbit, autonomous systems, a transformed developer tools market — that is not yet reflected in the income statement.<\/p>\n The smarter move is to let the IPO euphoria settle, watch how the Cursor option plays, and look for an entry point once the stock finds its post-lockup floor. The best companies are still great buys six months after the IPO crowd has moved on.<\/p>\n The analyst who called NVIDIA in 2010 just named his top 10 AI stocks <\/p>\n