Be ready to buy SpaceX on Day 1

- By Chris Wood, Chief Investment Strategist at RiskHedge

SpaceX filed for its IPO on April 1st, setting the stage for the largest IPO in history—in terms of capital raised and valuation.

The Information broke the story, and Bloomberg and Reuters quickly confirmed it.

We’re talking about raising up to $75 billion for a potential June 2026 debut at a valuation north of $1.75 trillion.

That would make SpaceX the 7th largest company in the world (by market cap) on day one of trading.

The only companies worth more today are NVIDIA, Apple, Alphabet (Google), Microsoft, Amazon, and TSMC.

So why now?

Because SpaceX has hit the private-market ceiling. The ambitions Elon Musk has for this company—scaling Starship launches, expanding Starlink to tens of millions of subscribers, building the recently announced Terafab chip factory with Tesla, launching orbital AI data centers—require capital at a scale that only the public markets can provide.

SpaceX’s recent all-stock merger with xAI (the company behind Grok that also owns X/Twitter) already pushed its private market valuation to about $1.25 trillion.

This is the moment private capital finally hands the baton to public markets for what might be the biggest infrastructure bet since the internet backbone was built in the 1990s.

And for the first time, everyday investors will get to own a piece of it.

SpaceX created the space economy

To understand why this IPO matters so much, you need to understand how SpaceX has completely rewritten the rules of space.

Before SpaceX, launching something into orbit was crazy expensive. We’re talking hundreds of millions of dollars per mission, with rockets that were used once and thrown away—like buying a brand-new 747 for every single flight and then just crashing it into the ocean on purpose.

You can see in the chart below that SpaceX has cut the cost of reaching orbit by more than 95% since 2000:

Source: FutureBlind on Substack

SpaceX accomplished this incredible feat with reusable rockets. The Falcon 9 lands itself after launch—something many “experts” said was impossible just 15 years ago—and can fly again and again. This innovation slashed launch costs and unlocked an entirely new commercial space economy.

The results speak for themselves.

In 2014, the entire US launched 23 rockets total (12 government and 11 commercial)—two per month on average. In 2025, SpaceX achieved a record 165 orbital launches—about one every two days on average—which accounted for about 86% of all US launches.

Meanwhile, as you can see on the chart below, Elon’s rockets have launched more mass into orbit since their first flight in 2006 than the rest of the US combined in its entire history.

Source: Flight Atlas

No other company is remotely close to this kind of throughput.

And despite competitors popping up, SpaceX still controls more than 80% of the global commercial launch market by mission count.

That tells you everything you need to know about the competitive moat here.

SpaceX’s structural advantage comes down to reuse plus vertical integration plus sheer volume. It builds the rockets, launches the rockets, lands the rockets, refurbishes the rockets, and does it at a pace and cost no one can match.

Starlink: The profit engine

If launches are SpaceX’s foundation, Starlink is its cash machine built on top.

Starlink is the largest satellite constellation ever assembled—over 10,000 operational satellites beaming internet service to more than 10 million active subscribers worldwide. That subscriber base doubled in about 15 months, making it one of the fastest-growing communications networks in history. For context, it took traditional telecom giants decades to reach comparable scale.

Starlink generated over $10 billion in revenue in 2025—roughly two-thirds of SpaceX’s estimated $15–19 billion in total company revenue.

The flywheel effects are compounding—each new subscriber makes the constellation more valuable for everyone else over time by contributing revenue that directly funds more satellite launches and a denser constellation, upgrades to newer generations, global expansion, lower latency, and new features. And the company’s vertical integration—owning its own rockets, satellites, ground stations, etc.—allow it to achieve unit economics competitors can’t touch.

Analysts expect Starlink revenue to reach $16 billion to $24 billion this year as the subscriber base continues to grow rapidly. It already controls about 90% of the satellite broadband market and its margins are improving as the constellation scales.

Put simply, Starlink provides SpaceX a high-margin, predictable subscription-based revenue stream with massive long-term flywheel effects and enormous barriers to entry. You can think of it sort of like Amazon’s AWS cloud computing business—a recurring-revenue platform hiding inside a rocket company.

The next frontier: Terafab and orbital AI data centers

Here’s where things get really interesting…

On March 21, Musk officially unveiled Terafab, a joint venture between Tesla and SpaceX to build the largest semiconductor fabrication plant in history. The facility would consolidate every stage of chip production under one roof. That’s never been done before.

The goal?

Produce one terawatt worth of AI computing power per year—about 50X the current global AI compute capacity.

The kicker: Musk expects 80% of that output to go to space, where SpaceX will do the AI computing the hyperscalers like Amazon and Microsoft currently do on Earth.

SpaceX has filed an application with the FCC to launch up to one million AI data center satellites into low-Earth orbit. These won’t beam internet like Starlink satellites. They’ll be distributed orbital data centers running AI workloads, powered by solar energy—where sunlight is continuous in orbit and about 1.4X stronger than on the ground, and there’s no need for real estate, bulky and expensive cooling systems, or grid connections.

Musk’s argument is that as launch costs continue to decline, running AI compute in orbit will become cheaper than doing it on the ground within two to three years. Whether you fully buy that timeline or not, the vision is extraordinary: SpaceX wouldn’t just be the company that launches things into space and provides satellite internet, it would own the compute layer of low-Earth orbit.

Here’s the takeaway most folks seem to be missing: SpaceX is becoming a vertically integrated space infrastructure platform—rockets + satellite broadband + AI compute + its own chip supply chain. The Terafab and orbital data center tie the Musk ecosystem together into one unified bet on the future of AI infrastructure. And the only place that can fund a bet this big is the public markets.

What the IPO could look like

SpaceX is expected to raise anywhere from $50 billion to over $75 billion—absolutely dwarfing Saudi Aramco’s $29 billion record from 2019—at a $1.75 trillion valuation.

The money will go to scaling Starship to an aggressive launch cadence, expanding Starlink toward 20 million subscribers, funding the Terafab chip factory, beginning deployment of the orbital AI data center constellation, and providing liquidity for early employees and investors who’ve been locked into private shares for years.

One structural note worth highlighting: as I alluded to earlier, xAI is already folded into SpaceX as a wholly-owned subsidiary. So when you buy SpaceX stock, you’re getting the combined “space + AI compute” platform in a single ticker. You’re not buying a rocket company—you’re buying the infrastructure backbone of both the space economy and, potentially, eventually, the AI economy.

The bear case—and why I think it’s wrong

Every investment opportunity has skeptics, and SpaceX is no exception. Here are the top three bear arguments I’m hearing—and why I think they’re wrong.

“It’s insanely overvalued”

This is the most common pushback. And on the surface, $1.75 trillion for a company with $15-$19 billion in revenue—reflecting a price to sales ratio of about 90 to 115—does sound quite steep. But let’s look a bit deeper.

Starlink alone is already generating over $10 billion in recurring, subscription-based revenue that’s growing 60%-80% year-over-year. Margins are improving as the constellation scales and capex normalizes.

Meanwhile, PitchBook’s sum-of-parts analysis of SpaceX already supports a $1.1-$1.7 trillion valuation.

We heard the exact same argument about Tesla when it was ramping up. Bears called it a bubble, a meme stock, a fantasy. Then the company executed, scaled production, and expanded margins—and the stock went on to produce life-changing returns for investors who ignored the noise.

The pattern is the same here. Private markets already valued SpaceX at $1.25 trillion. And public markets tend to pay up for visible execution milestones with premium multiples.

“Musk is a liability”

Lots of folks seem to be worried about key-man risk—that Musk’s political activities, Twitter/X controversies, and general unpredictability will weigh on the stock.

That’s a fair critique and certainly something that could cause significant short-term volatility. But I’d urge you to disregard your opinion of Musk—whether negative or positive—and just look at his long-term results. He’s created more wealth than anyone in history.

Meanwhile, SpaceX’s government contracts—NASA, DoD, and others—are performance based, not personality-based. The rockets either work or they don’t. The satellites either deliver like they’re supposed to or they don’t. And so far, they work spectacularly well. Musk’s distractions haven’t slowed SpaceX execution one bit—the company set launch records even during the Twitter acquisition saga.

“Competition is heating up”

That’s true. But it’s heating up slowly and SpaceX still has an enormous lead.

Take Amazon Leo, for example, which is supposed to be Amazon’s answer to SpaceX’s Starlink. Announced in 2019 (and formerly known as its Kuiper project) Amazon was supposed to have more than 1,600 low-Earth orbit broadband satellites in orbit by July of this year according to its agreement with the FCC.

So far, Amazon has only been able to get about 250 into orbit. That’s about 16% of what it’s supposed to have in orbit just three months from now. And remember Starlink already has more than 10,000 satellites in orbit.

Amazon admitted it’s going to fall well short of the target recently when it requested a 24-month extension with the FCC.

What’s more, Amazon still needs SpaceX rockets to deploy its own constellation. That’s like Pepsi needing Coca-Cola’s delivery trucks to get product to stores.

Meanwhile Blue Origin’s New Glenn spacecraft just completed its first orbital launch in early 2025. SpaceX flew 165 missions that year.

Here’s my bottom line on the bear case: Betting against Musk on execution has arguably been the most expensive trade of the last decade. Every time “experts” have said something was impossible—reusable rockets, a thousand Starlink satellites, catching a rocket booster with a tower—Musk and his team have done it anyway. You might think you sound smart at a dinner party trashing Elon’s plans, but the investors who back him laugh at you on their way to the bank.

Be ready to buy SpaceX on day one

You probably figured out from my tone that I’m extremely bullish on SpaceX in the long-term. And I think investors should be prepared to buy shares as soon as they can.

Conventional wisdom says you should typically wait for the lock-up period to expire—typically 180 days after an IPO—before buying. The thinking being that when insiders are finally free to sell their shares they flood the market with supply and push the price down to create a better entry point.

That playbook makes sense for a normal IPO. But SpaceX is not a normal IPO.

Here’s why I don’t think waiting works this time:

Demand for the stock will be insatiable. This is arguably the most anticipated IPO in market history. Basically every institution, sovereign wealth fund, and retail brokerage account in the world is going to want exposure. And SpaceX is only expected to offer about 3%-5% of its equity at IPO—one of the smallest large-cap floats in modern history. I expect this scarcity plus demand to translate into sustained premium pricing.

The next 12 to 24 months are packed with catalysts. Starship reuse at scale, Starlink subscriber growth toward 18 million plus, Terafab construction milestones, the first orbital data center satellite prototypes—early trading will likely price in many of these milestones ahead of time, rewarding those who get in early.

All that said, there will be short-term volatility. Musk tweets, regulatory noise, macro headwinds—all of that can create turbulence. It’s certainly possible the stock could lose more than 50% of its value in its first year or two trading on the public markets.

But on a 3-5 year horizon, I think SpaceX is the highest-conviction “picks and shovels” bet on the space and AI economies available to public-market investors.

Elon Musk has made the impossible routine. Backing him has been the highest-returning decision of the 21st century so far. I’m not going to overthink this one.

Be ready.

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Chris Wood is Chief Investment Strategist at RiskHedge. To get more ideas like this from him, check out his substack Grow or Die.