SpaceX Shares Drop Over 20% from IPO to $107.01, $1.2 Trillion Lost, 900M Shares to Unlock

SpaceX shares fell more than 5.7% intraday on July 28 to a low of $107.01, 20.73% below the $135 IPO price. The stock later rebounded, rising over 2% on the day to $116. On the third day of trading (June 16), SpaceX shares had reached $225.64. The decline has erased a cumulative $1.2 trillion in market value from the peak, making it one of the largest market value contractions in history.

Recent geopolitical turmoil, combined with market concerns that massive spending in the artificial intelligence ecosystem is driving up demand and valuations, has weighed on the share prices of several large technology companies. SpaceX's biggest future market opportunity also lies in the AI sector. According to the lock-up plan, up to over 900 million shares will become available for trading starting August 6.

Over the past month, SpaceX's elevated valuation and the looming potential selling pressure have attracted a large number of short sellers.

Although SpaceX completed a largely successful Starship test flight last Friday, selling pressure on the stock continued to intensify. During the test, SpaceX deployed upgraded satellites for the Starlink communications network, and the rocket returned to Earth largely safely. Starship is the core project for expanding the Starlink network, carrying out crewed lunar and deep-space exploration missions, and future plans to deploy data centers in space. However, the project's development has been fraught with uncertainty, experiencing multiple explosion incidents, technical failures, and delays.