SpaceX shares slide on the heels of first quarterly report
SpaceX's share price declined more than 13 percent following the company's first quarterly earnings report as a publicly listed firm, with investors concerned about a sixfold increase in capital expenditure to $18.37 billion, primarily directed toward artificial intelligence infrastructure. The stock closed at $108.10, down from $125.33 the previous day.
SpaceX shares experienced a sharp decline of 13.6 percent in the day following the company's inaugural quarterly earnings announcement as a publicly traded entity. The stock closed at $108.10, down significantly from the prior day's closing price of $125.33.
Market participants expressed concern over the company's substantial increase in capital expenditure. The $18.37 billion in planned spending represents a sixfold increase compared to the previous year and substantially exceeds the $13.2 billion that analysts had anticipated. Of this total, $15.8 billion is allocated to artificial intelligence infrastructure, encompassing specialized computing resources, storage systems, networking capabilities, and software platforms necessary for developing, training, and operating large-scale AI models. SpaceX has indicated plans to expand its data center capacity from the current 1.4 gigawatts to 2 gigawatts by year-end.
Investors across the technology sector have grown skeptical about whether substantial investments in AI infrastructure will generate meaningful financial returns. Industry observers noted that similar scrutiny has affected major technology companies during the current earnings season, with shareholders increasingly demanding visible returns on large capital allocations. SpaceX faces particular challenges in justifying these expenditures, as the company is asking shareholders to fund data centers located in orbit.
The company has countered that its computing capacity serves multiple purposes beyond its Grok models, with $14.1 billion in cloud-services agreements already secured. SpaceX's connectivity business demonstrated stronger performance, with Starlink satellite communications revenue increasing 66 percent year-over-year as subscriber numbers doubled to 12 million, generating $1.66 billion in operating income.
Additional pressure on the stock emerged as the first tranche of post-IPO lock-up restrictions expired on Thursday, making approximately 911.5 million shares—roughly 20 percent of restricted holdings—eligible for sale. Analysts indicated the stock would likely experience heightened volatility following the lock-up expiration. SpaceX's IPO was priced at $135 per share and initially climbed to $225 within days of its June 12 debut before subsequently declining.
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