SpaceX will get off the ground – but a descent from a silly valuation must follow
The Guardian argues SpaceX’s IPO may succeed on Musk’s pull, but the $1.77tn valuation looks far above cash-flow-based estimates.
Intelligence analysis by GPT-5.4 Mini
Nils Pratley says SpaceX may still float successfully because of Musk, Wall Street support, and passive index demand. But he argues the price is detached from current profits and likely to come back down after the debut.
SpaceX is like a rocket ship with a very expensive sticker price. The article says people may still buy it because they trust Elon Musk, but the company’s current earnings do not seem big enough to match that price.
Analysis
The valuation problem
The column argues that SpaceX’s proposed valuation is hard to justify from its current business. The company reported a $4.9bn loss in 2025 on $18.7bn of revenue, yet is being priced at about $1.77tn, or close to 100 times sales.
What supports the price
The article says SpaceX does have real strengths. Starlink is described as the main draw, making up 60% of revenue and holding a leading position in satellite broadband, especially in remote locations. SpaceX’s reusable rockets have also pushed launch costs down sharply, giving it a strong position in third-party launch services.
Where the story goes beyond rockets
The piece says the real hope value is being attached to xAI, which was folded into SpaceX earlier this year. It notes that most of the money raised in the IPO will go toward xAI, while X is described as a small part of the package. The idea of AI datacentres in space is mentioned as a long-term possibility, but the article treats that as speculation rather than a basis for today’s price.
Why the stock may still list well
Despite the valuation concerns, the column argues the IPO may still be absorbed by the market. Musk’s reputation, major Wall Street advisers, and forced buying from index trackers could all help. The author’s central view is that the shares may launch strongly, but a more grounded valuation should follow later.
Key points
- SpaceX is seeking a massive stock market debut at a valuation the columnist calls detached from reality.
- The company lost $4.9bn in 2025 on $18.7bn of revenue, according to the article.
- Starlink is the core business, making up 60% of revenue and giving SpaceX a strong market position.
- A large part of the IPO story is actually about xAI, not just rockets or satellite broadband.
- The writer thinks the stock may rise at first, but a lower valuation is likely over time.
If investor enthusiasm holds, SpaceX could complete a huge listing and keep attracting buyers because of its leading rocket business and Starlink’s strong position. The article also suggests the company’s scale and market power may let it raise a lot of money for future AI ambitions.
The main risk is that the share price is built on hopes rather than present-day profits, so it could be pulled back later toward a lower level. The article also warns that forced demand from index funds and momentum buying can make a boom bigger now and a reversal harsher later.
