SpaceX's Lock-Up Expiry Puts a $43.7 Billion Question to the Market

SpaceX faces a $43.7B lock-up expiry as sovereign funds buy in, but bears cite negative cash flow and high valuation.

The arithmetic is stark: roughly 320 million SpaceX shares, worth about $43.7 billion, become tradable on Thursday. That is 3.4 times the entire volume that changed hands on Friday. For a stock that has already swung from euphoria to near-halving and back again since its June debut, the question of whether that overhang becomes a waterfall is now front and center.

The company's public-market life has been anything but calm. Listed on June 12 at $135 per share, the equity climbed to a high of $225.64 before losing more than half its value. Market capitalization swung from roughly $1.4 trillion in early August to nearly $2 trillion a week later — with no change in the underlying fundamentals to explain the whiplash. The first lock-up expiry, in early August, produced not the anticipated selling wave but a rally of around 40 percent.

In German trading, the stock closed Friday at €120.96, down 1.2 percent on the day but still up 5.1 percent for the week. That leaves the shares roughly 33 percent above their 52-week low of August 3, yet still 38 percent shy of the June 16 peak. The annualized 30-day volatility of 93 percent tells the story of a large-cap that trades with the temperament of a speculative small-cap.

A Sovereign Vote of Confidence

Into that turbulence has stepped one of the world's most deliberate investors. Norges Bank Investment Management, the Norwegian sovereign fund managing $2.3 trillion, disclosed its first-ever SpaceX position: a stake worth $1.22 billion as of June 30, representing 0.05 percent of the company. It is a notable departure for the fund, which has historically been cautious about high-volatility technology names.

The Norwegian entry is not an isolated one. Harvard Management Company now holds SpaceX shares valued at $2.2 billion — the largest single position in the university's $4.3 billion US equity portfolio. Australian mining magnate Gina Rinehart, via Hancock Prospecting, has also taken a stake, as has the Australian pension fund AustralianSuper, though the latter's position remains modest at 73,500 shares after two volatile months since the listing.

The Bull and Bear Case, Side by Side

The valuation debate is as wide as the stock's trading range. Morgan Stanley sees the shares at $300, anchored on the AI growth potential around the Cursor programming platform acquisition and Starlink's momentum — the satellite business counted 12 million subscribers and 10,200 satellites in the second quarter. Aaron Burnett of Mach33 Financial Group goes further, suggesting on CNBC that SpaceX could be worth double-digit trillions by the 2030s, framing the company as an AI platform rather than a pure rocket operator.

The bear case is equally emphatic. Goldman Sachs projects negative free cash flow of $105 billion through 2029. Short-seller Jim Chanos calls the current $1.75 trillion valuation unjustified, while valuation expert Aswath Damodaran puts fair value at just $1.3 trillion.

Strong Numbers, Heavier Spending

The fundamentals, at least on the top line, support the optimists. Second-quarter revenue grew 92 percent year over year to $7.8 billion, comfortably ahead of the $6.9 billion consensus, with adjusted EBITDA up 191 percent to $3.5 billion. The connectivity segment — Starlink — delivered $4.3 billion in revenue and $1.66 billion in operating profit, with subscriber numbers doubling year on year. Management raised its annual guidance for the first time, projecting third-quarter connectivity revenue growth above 50 percent to $4.7 billion at a 37.5 percent operating margin.

The counterweight is capital expenditure: $18.4 billion in the quarter, of which roughly $15.8 billion went to AI infrastructure. Part of that flows into "Terafab," a planned chip factory in Texas's Grimes County developed jointly with Tesla, requiring an initial investment of $16.8 billion, at least 3,000 jobs, and more than 100 million square feet of floor space. Across multiple construction phases, SpaceX alone could pour up to $119 billion into the project.

Rockets Keep Flying

The operational cadence shows no sign of slowing. On Tuesday, a Falcon 9 lifted 29 Starlink satellites from Cape Canaveral, followed hours later by a Vandenberg launch carrying 24 more — the 72nd and 73rd Starlink missions of the year. August 28 is set for Flight 14 of the Starship system, which will attempt the first catch of the upper stage by the launch tower. The previous test flight in July delivered mixed results: the booster landing went to plan, but only ten of thirteen engines ignited on reentry, with five still running at splashdown. The upper stage did successfully deploy 20 third-generation Starlink satellites in a realistic payload test.

For investors, the picture is a study in contrasts: record revenue, a landmark institutional endorsement, and relentless operational execution against a wall of capital intensity and a valuation gap that refuses to narrow. Thursday's unlock will test whether the patient money now lining up is enough to absorb what the market is about to set free.