SpaceX reports its first earnings since going public after the market closes today, with a short position of about $23.6 billion hanging over the stock and $116 billion in lockup shares set to be released on Aug 6, according to CNBC.
Short sellers have built a position larger than Tesla’s, making SpaceX one of the most shorted technology stocks, according to CNBC. The bears are betting that the stock, which has run up sharply since its listing, cannot hold its level once the selling starts. The lockup expiry gives them a date to aim at: shares held by insiders and early investors, worth about $116 billion at current prices, become eligible for sale on Aug 6, two days after the earnings report.
Lockup expiries often trigger selling as investors who have waited months for liquidity cash out, and the mechanics of this one are unforgiving. The lockup covers a large portion of the company’s shares, and even a modest fraction of selling would dwarf the daily trading volume. Analysts said the market has known about the expiry for months, which cuts both ways: the pressure is priced in, but so is the risk that actual selling exceeds expectations.
Morgan Stanley, one of the banks that underwrote the offering, maintained its $300 price target heading into the report, a signal that the firm expects the stock to absorb the pressure. The target implies the analysts see the short-term noise as secondary to the company’s fundamentals: a launch business with no real competition, a satellite internet arm with millions of subscribers, and a rocket program that keeps breaking records.
The earnings report is the first chance for Wall Street to see SpaceX’s finances in full, including the scale of Elon Musk’s AI spending inside the company. Musk has directed growing sums toward AI as part of his broader ambitions, and investors have been waiting for the numbers, according to people familiar with the matter. The report will show how much of the company’s cash is being reinvested in Starship, the giant rocket in development, and in the AI systems Musk wants to run.
SpaceX’s core businesses have been growing fast. The launch business dominates the global market, flying hundreds of missions a year on Falcon rockets while competitors work to catch up. Starlink, the satellite internet service, has said it has more than five million subscribers and has become the company’s main source of recurring revenue. Starship, the next-generation rocket, has completed a series of test flights and is central to the company’s plan to lower launch costs further.
The company spent two decades as a private giant, raising money in rounds that valued it at ever-higher levels before it reached the public market. Its listing was among the most anticipated of the year, and the stock’s early performance reflected the demand: investors who could not get access to the private rounds lined up for the public shares.
The market is split on what happens next. Short sellers argue the stock ran too far, too fast after the listing, and that the lockup supply will overwhelm demand. Bulls counter that SpaceX’s revenue growth and its position in launch support a long-term thesis that no amount of near-term selling can change. The two-day window between the earnings report and the lockup expiry sets up an unusually volatile stretch, analysts said.
History offers mixed lessons. Some companies have seen shares tumble after lockup expiries, as Facebook did in 2012 when selling pressure combined with doubts about its business. Others have rallied when the expected selling failed to appear, because the overhang that had capped the stock was finally gone. Which path SpaceX takes depends on how much of the lockup actually hits the market.
The report will also be scrutinized for guidance: what SpaceX expects to spend in the coming year, whether it plans another capital raise, and how it intends to fund the AI push that Musk has made part of the company’s story. Investors will look for evidence that the spending produces revenue, not just ambition.
There is also the question of Starlink. Analysts have speculated for years that the satellite business could eventually be spun off as its own public company, and the earnings report will offer evidence on whether it can stand alone. A separation would give SpaceX a cleaner launch business and give Starlink its own access to capital, but Musk has given no indication of timing.
For a company that spent two decades as a private giant, the public market has been a new kind of test. The first report, the $116 billion lockup and the record short position will tell investors how the market values a company that has never had to answer to it before. The numbers come out after the close, and the answer starts now.
