SpaceX slips below $135 IPO price as 319 million shares unlock

About 319 million SpaceX shares held by employees and early investors became eligible to sell on Thursday, and the stock dropped back through its June listing price of $135 within the first hours of trading.

Shares in the rocket and satellite company, listed on the Nasdaq as SPCX, traded as low as $132.72 as of 10:59 a.m. Eastern, down close to 5% on the day, or about $6.93 a share. The slide left the stock roughly where it opened when it went public in June and erased the gain it had built earlier in the week.

The release was the second large unlock since the June flotation, which raised about $85.7 billion, and it marks the Day 70 tranche in a staggered schedule that will free roughly 88% of SpaceX's 13 billion shares through 2027. The newly eligible block amounts to about 7% of the roughly 4.6 billion shares in the 180-day lockup group.

The August 6 precedent

Two weeks earlier, on August 6, as many as 911.5 million shares became tradable, more than doubling the thin public float. Instead of sinking, SPCX rose about 6% that day and climbed further the next, a move read as a sign that insiders were not rushing to sell.

The backdrop this time is different. On August 6 the shares were coming off a low near $105, with room to recover. They had since recovered to $139.65 at Wednesday's close, below a $150 level the stock had failed to clear more than once, turning the release into a supply test under a technical ceiling.

Thursday's fall reversed a rally earlier in the week. The stock had climbed about 4.5% on Monday after quarterly filings showed more than 1,500 institutions reporting positions as of June 30, a move that lifted SPCX roughly 30% from its early-August level and turned a widely feared unlock into an unexpectedly strong stretch.

Ownership is unusually concentrated. The five largest reported holders account for about three-quarters of the shares disclosed in quarterly filings, Alphabet the largest at 551.2 million and Fidelity next at 302.6 million. Those positions are as of June 30 and were disclosed on August 14.

Eligible does not mean sold

A lockup expiration grants the right to sell, not the obligation. None of the 319 million shares has to trade, and how many reach the market depends on decisions made by thousands of holders the company does not control. The expiration removes a restriction; it does not create a seller.

Most of the freed stock sits with insiders and early backers. A Benzinga news analysis argued those holders are unlikely to sell heavily after a roughly 40% slide from the post-listing high near $225, though a thin float can still amplify swings in either direction.

We are bullish and believe that we will look back to the lockup-expiry debates of 2026 as buying opportunities within a long-term, differentiated bull case.

That reading is close to the broader Wall Street view heading into the expiration. The stock carried a Moderate Buy consensus built on 24 Buy recommendations, five Holds and three Sells, and Morgan Stanley's Adam Jonas has described weakness around the unlock as a chance to buy rather than a reason to avoid the shares. DZ Bank started coverage at Sell on Thursday with a $100 target.

The supply still to come

The unlock is one of a series arriving every three to four weeks through the rest of the year. Another 319 million shares are due to free up on September 9 and a further 328 million on September 24, with three more tranches in October worth close to a billion shares between them, before the largest releases land, a predictable drumbeat of supply the market can see coming.

A 1.3 billion-share tranche is set to unlock around SpaceX's third-quarter earnings in early November, followed by the 180-day lockup expiry on December 8. By then, roughly 40% of the company's stock could be freely tradable, and by the middle of 2027 Reuters calculates that about 12.9 billion shares will have been freed in total.

Musk's roughly 6.42 billion shares, about 48% of SpaceX and more than 80% of its voting power, sit outside that schedule, under a separate one-year lockup that runs until June 2027.

The free float began at only about 4% to 5% of the company at the June listing and stood near 12% after the August 6 unlock. A float that thin can magnify moves in either direction, because even ordinary demand shifts a price that has little stock available to meet it, and it raises the odds of a short squeeze as much as a slide.

The argument over value

Beneath the supply calendar runs a dispute about what SpaceX is worth. At Wednesday's close the company was valued near $1.84 trillion, about 41 times the $44.75 billion in revenue it is projected to record this year, a multiple that leaves the stock exposed to any stumble.

Scott Galloway, a marketing professor at New York University, called the stock 'still crazy overvalued' on a podcast recorded on August 18 and put fair value between $10 and $30 a share, a fraction of where it now trades. He also said he would not short it.

The bull case rests on growth. Second-quarter revenue rose 92% from a year earlier to $7.81 billion, led by the company's artificial intelligence unit, though connectivity remained the largest business. Capital spending reached about $18.4 billion in the quarter, roughly 2.4 times revenue, a gap analysts say will take years to close.

SpaceX turns to acquisitions

SpaceX has been spending heavily on its AI business even as the shares churn. On August 14 it closed a $60 billion all-stock purchase of Cursor, the coding company also known as Anysphere, issuing 389,289,254 new Class A shares to pay for the deal, a fresh block of stock on top of the lockup releases.

Days later Bloomberg reported that SpaceX had approached a second AI startup, Cognition, whose Devin agent automates programming work. Cognition's chief executive, Scott Wu, said publicly that the company is 'not for sale and we haven't been talking,' and Musk said the two sides had discussed nothing beyond making Grok work for Cognition's needs.

The shares issued for Cursor are separate from the lockup releases and cannot trade until their resale is registered or Rule 144 becomes available, and the company has dated neither. When those shares reach the market, they will add to a supply calendar already crowded through the winter, deepening the dilution the deal brought without a published integration timeline.

The stock closed its first trading day at about $161, roughly 19% above the $135 listing price, and ran to a post-listing high of $225.64 before sliding to about $105 around its first quarterly report. It has spent the weeks since clawing back toward its $135 debut, and Thursday's drop carried it under that mark again.

Pressure beyond the unlock

The unlock was not the only weight on the shares. DZ Bank started coverage at Sell on Thursday, and Musk pushed the timeline for catching a Starship booster past the late-August window given on the August 4 earnings call to the next few months. A rocket milestone by China's LandSpace, whose Zhuque-3 booster landed this week, had already weighed on the stock on Wednesday.

How much the release matters turns on selling that has not yet happened. The stock absorbed a far bigger unlock on August 6 and rose, and traders were watching to see whether the same buyers would step in this time rather than let the new supply weigh on the price.

What the September tranche does, and whether insiders sell into it, will not be known until it arrives.