Elon Musk’s name usually conjures up images of Mars colonies and rockets punching through the atmosphere. Right now, though, the real drama isn’t happening in orbit. It’s happening on Wall Street.
Six weeks after SpaceX’s blockbuster IPO, the stock is getting hammered, and a small army of short sellers is making a fortune off the fall.
The Bears Are Winning — And Musk Knows It
Here’s the setup. SpaceX (ticker: SPCX) priced its IPO at $135 back on June 12. Shares shot up as high as $225 within days — classic IPO euphoria. Then reality set in. By mid-July, the stock had given back nearly all of that gain, dipping to around $132 and closing below its own IPO price for four straight sessions.
That’s a brutal chart for anyone who bought the hype. But for short sellers? It’s payday. Estimates put their paper profits at roughly $8.7 billion so far. Short interest has ballooned from about 40 million shares a month ago to something like 206 million — nearly a third of the entire public float. That’s not a normal amount of skepticism. That’s Wall Street basically betting the whole thing is overpriced.
Musk, predictably, isn’t taking this lying down. He took to X to warn that the “survival probability” of firms shorting SpaceX is “very low.” Whether that’s a genuine threat or just Musk being Musk, the short sellers don’t seem scared off yet.
A $1.25 Trillion Company That’s Bleeding Money
Here’s where it gets interesting. When SpaceX absorbed Musk’s AI venture xAI earlier this year, the combined company was valued at around $1.25 trillion. Going into the IPO, SpaceX was reportedly chasing something closer to $1.75 trillion.
Big numbers. But the AI side of that business — the part meant to justify the trillion-dollar price tag — is apparently losing about $6.4 billion a year. That’s not a typo. Billion, with a B, every single year, on a segment that’s supposed to be the future of the company.
Analysts have been saying for a while now that SpaceX’s valuation has almost nothing to do with its actual cash flow. The market seems to finally be catching up to that argument.
Thursday Is a Big Deal — Starship Is Flying Again
All eyes are on the next Starship test flight, and it’s not just rocket nerds paying attention anymore. This launch is basically a referendum on whether Musk’s bigger promises — moon bases, orbital data centers, the whole vision — have any real footing. Success or failure, expect the stock to move hard either way.
Meanwhile, China Just Caught Up a Little
SpaceX’s biggest edge has always been reusable rockets. Nobody else could really do it. That’s changing. In July, China pulled off something no one outside the U.S. had managed before — landing a Long March 10B booster on an offshore recovery platform using a net system. It worked. It’s a genuine milestone, and it chips away at the idea that reusability is a SpaceX-only trick.
On top of that, Musk’s plan to put AI data centers in orbit is getting a lot of pushback from people in the industry who think the economics simply don’t add up yet.
August 4 Is the Real Test
Everything comes down to August 4, when SpaceX reports its first quarterly earnings as a public company. This is the moment investors actually get to see the numbers behind the hype — not projections, not vibes, actual financials.
If the report disappoints, don’t be surprised if the stock finds a new, lower floor. If it impresses, the short sellers might be in for a rough surprise of their own.
Is Musk losing his grip financially while chasing the stars, or is this just the turbulence before the next big leg up? We won’t have to wait long to find out.
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