What is SpaceX?
When I shared my excitement about the much anticipated SpaceX IPO with someone, their first response was, “What on earth is SpaceX?” And honestly, it’s the perfect place to start. If you’re not quite sure what SpaceX is, or what an IPO is for that matter – you’re in the right place. In true FMD fashion, let’s demystify this one from the ground up.
SpaceX is Elon Musk’s aerospace company, the one behind Starlink and all those rocket launches you’ve seen on the news. And as of early 2026, it’s bigger than just rockets: SpaceX absorbed Musk’s AI company – xAI (the maker of Grok) and his social platform X, so when you buy into the IPO, you’re buying into all three at once.
What is an IPO?
Short for Initial Public Offering, an IPO is the process of a company going from private to public. While a company is privately held, the public can’t buy its shares or peek at its financials – it’s a private affair. But once a company goes public, anyone can buy a slice of ownership, and in return, the company has to reveal its financials to the whole world.
Why would a company want to go public?
The moola. The money. Going public enables companies to raise serious funds and SpaceX is poised to become the biggest IPO in market history. The company is reportedly eyeing a valuation north of $1.5 trillion and could raise more than $80 billion in a Nasdaq debut under ticker “SPCX.” The shares are expected to start trading around June 12, 2026, though that date isn’t officially confirmed.
The Numbers
As investors, our main focus is the bottom line – how profitable a company actually is or expected to be. Regrettably, I see a lot people buying stocks without even taking a look at the numbers.
In SpaceX’s case, the numbers reveal a company that isn’t yet profitable. In 2025, it lost $4.9 billion on $18.7 billion in revenue. However, that single number doesn’t tell us the full story. SpaceX is really three businesses bolted together: Rockets, Starlink, and xAI, and each one tells a different story.
Three Businesses, three stories
Starlink – The engine that actually makes money. The satellite internet division generated $11.4 billion in revenue in 2025, more than half the company’s total and it’s the only part of SpaceX that turns a profit, posting around $4.4 billion in operating income for the year. It’s also growing fast, crossing 10 million subscribers across 160-plus countries. In short, Starlink is the cash cow funding everything else.
The rocket launch business – The part most people picture when they think of SpaceX, is smaller and, perhaps surprisingly, not yet profitable. It brought in roughly $4.1 billion in revenue in 2025 but ran a small operating loss of around $660 million, weighed down by heavy spending on Starship development. It’s an entrenched, dependable operation with a record number of launches under its belt, but the money is going back into building the next generation of rockets.
xAI – Musk’s artificial intelligence venture that merged into SpaceX, is the wild card and the biggest drain by far. It contributed $3.2 billion in revenue in 2025 but posted an operating loss of around $6.4 billion, burning through cash as it pours money into data centres and computing power in the race to win the AI arms race. Of SpaceX’s three businesses, xAI is the one bleeding the most.
Final thoughts
So is SpaceX worth investing in? That’s not for me to say. But here’s the bottom line: SpaceX isn’t making money yet. Investors who buy in are betting it will in the future – the bet is that Starlink keeps growing and that the rockets and xAI will eventually pay off. There’s also the Elon Musk factor to consider. Tesla is a rare case of a company that doesn’t really trade on its fundamentals (its stock price runs on hype and future promise rather than current earnings), and the same may hold true for SpaceX – investors may simply back the visionary Elon Musk. Whether that’s a smart bet is up to you but at least now you know what’s under the hood.
– Adonis
Disclaimer: The information contained in this article is purely educational and does not constitute as investment advice. Any commentary provided is the personal opinion and philosophy of the author. It is not intended nor should be considered as invitation or inducement to buy or sell any securities noted within. Investing and trading carry significant risk, please contact a financial professional before making any investment decisions.
