Musk Loses Trillionaire Status as Starship Abort Sends SpaceX Stock Below IPO; Pentagon Deal Could Shift Fortunes

Elon Musk's net worth drops below $1T after SpaceX Starship test abort triggers $45B loss, stock plunge, and short-seller surge; lock-up expiration looms.

Elon Musk is no longer the world's first trillionaire, at least not according to Forbes. The abort of SpaceX's 13th Starship test flight on July 16 wiped $45.3 billion from his net worth in a single day, dragging it to $792.8 billion from a June 16 peak of $1.45 trillion. The trigger was a last-second countdown failure at T-0: four of 33 Raptor engines on the Super Heavy booster failed to ignite, forcing the automated flight computer to shut down the remaining 29 engines. Two of the faulty engines need to be replaced, and SpaceX has rescheduled the launch for July 20 at 6:45 p.m. Eastern Time.

The mechanical setback punctuated a brutal month for SpaceX stock, which closed on Friday at $123.99 — a 5.4% drop on the day and the first time the shares have traded below their June IPO price of $135. In euros, the closing price stood at €108.40, down 5.39% from the previous session. From the all-time high on June 16, the stock has cratered 44.26%, erasing more than a trillion dollars in market capitalization. SpaceX’s valuation has shrunk from a record $2.64 trillion to $1.61 trillion as of July 17.

The flight abort crystallized a broader sell-off that had already been brewing. Short sellers have piled in aggressively: the percentage of outstanding shares sold short has surged from 5%–7% three weeks ago to around 29% today, representing roughly $25 billion in bearish bets. Adding to the pressure, the company faces a looming lock-up expiration. After SpaceX reports second-quarter earnings, approximately 911.5 million shares — worth about $123 billion at current prices — will be freed for trading, with additional tranches releasing through September. Musk’s own 42% stake remains locked until June 2027.

SpaceX’s operating results do little to reassure. In the first quarter of 2026, the company posted revenue of $4.69 billion but a net loss of $4.28 billion, with free cash flow coming in at negative $9.06 billion. It finished the quarter with $100.8 billion in cash on hand after the IPO. For the full year 2025, SpaceX reported a net loss of $4.9 billion. The Starship program alone has consumed $15 billion in investment to date.

Wall Street remains deeply divided. Price targets from major banks range from Raymond James’s bullish $800 to MoffettNathanson’s cautious $131, with a consensus around $235. Critics point to a price-to-sales ratio of roughly 49 times and a price-to-book multiple of 47.3 — well above industry norms. Yet Cathie Wood has been buying the dip, purchasing $16.7 million worth of SpaceX shares on July 15 and accumulating more than $50 million in total during the month.

Even as the stock sinks, a potential strategic pivot has emerged. According to a Wall Street Journal report, SpaceX is in early talks with the Pentagon to provide dedicated data-center capacity for running advanced artificial intelligence models. The deal would be structured similarly to the multibillion-dollar cloud agreement SpaceX signed with Google in June — a multiyear contract valued at roughly $920 million per month through 2029. If finalized, it would catapult SpaceX from a pure-play launch and satellite operator into a serious competitor to established cloud providers.

All eyes now turn to the Starbase facility in Texas, where Booster 20 has been rolled back for engine swaps and Ship 40 detached. A successful launch on July 20 — carrying 20 Starlink V3 satellites and testing an in-space Raptor relight, followed by an Indian Ocean splashdown — could flip the narrative. Another failure would heap further pressure on a stock already trading below its IPO price, with short sellers and lock-up overhang offering no relief. The NASA Artemis III moon mission, which depends on Starship for its lunar lander, is watching closely.