<\/p>\n
Venture capitalist Steve Westly says SpaceX is “three moonshots in one company” and the math only works if most of them pay off.<\/p>\n
On June 12, SpaceX (SPCX) just pulled off the biggest initial public offering in stock market history.\u00a0<\/p>\n
The company raised $75 billion, priced shares at $135 each, and debuted on the Nasdaq with a bang, jumping 19% on its first day of trading, according to CNBC.By the closing bell, shares had settled around $161. That put the company’s market cap at roughly $2.1 trillion.\u00a0The pop continued after hours, lifting the valuation closer to $2.2 trillion.<\/p>\n
But behind the celebratory bell-ringing, a veteran investor with deep experience with Elon Musk has a pointed message for anyone considering buying in.<\/p>\n
SpaceX is not just a rocket company<\/p>\n
SpaceX isn’t just a rocket company anymore. Musk folded his artificial intelligence startup xAI into SpaceX in February 2026.\u00a0<\/p>\n
The combined entity consists of AI data centers, the Grok AI models, the X social network (formerly Twitter), and an AI image generator.<\/p>\n
So SpaceX now spans three very different businesses: rockets and space exploration, Starlink satellite internet, and an AI division.<\/p>\n
More AI:Micron sits at the center of a red-hot chip rallyIBM CEO sends blunt message on AI and quantum computingAnthropic CEO makes shocking admission about AI<\/p>\n
The only part currently turning a profit is Starlink. According to the SEC filings, the satellite internet unit generated $4.4 billion in operating profit last year. <\/p>\n
The AI division, by contrast, lost $6.4 billion while bringing in just $3.2 billion in revenue, as CNN reported.<\/p>\n
The company has lost $41.3 billion in total since its founding in 2002, according to its prospectus filed with the Securities and Exchange Commission.<\/p>\n
Steve Westly’s candid warning about the $2 trillion SpaceX valuation<\/p>\n
Westly, who served on Tesla’s board and founded The Westly Group, told CNBC’s “Squawk Box Europe” that figuring out what SpaceX is worth isn’t easy.<\/p>\n
The three businesses inside it are, in his words, “completely disparate.”<\/p>\n
His bottom line? At least two of the three bets need to work out.<\/p>\n
“SpaceX is three moonshots in one company, but I think they’re going to need to make at least two of these moonshots successful to keep that $2 trillion valuation,” Westly told CNBC.<\/p>\n
SpaceX’s own IPO prospectus acknowledged that some of its plans rely on technologies that do not yet exist.<\/p>\n
Related: 5 reasons why the SpaceX IPO could be an absolute dud<\/p>\n
There’s also the governance issue. Musk holds super-voting Class B shares that give him around 85% of the shareholder vote, CNN reported.\u00a0<\/p>\n
In plain terms, he would essentially have to vote against himself to be removed. Investors take on real financial risk but have almost no say in how the company is run.\u00a0<\/p>\n
Research firm Morningstar put SpaceX’s fair value closer to $780 billion, less than half the IPO valuation, suggesting the market is pricing in significant future optimism.<\/p>\n
Is a Tesla-SpaceX merger next?\u00a0<\/p>\n
There’s one more wrinkle for investors to consider. Westly told CNBC he thinks a merger between SpaceX and Tesla is “absolutely likely.”<\/p>\n
CNBC reported in May, citing people familiar with the matter, that the two companies already share a long list of resources and that Musk has discussed combining them.\u00a0\u00a0<\/p>\n
Westly didn’t dismiss the governance headaches that would come with such a move, but he didn’t back away from his prediction, either.<\/p>\n
“It’s going to be a tricky one. There will be a lot of governance issues, people will have complaints about that, but\u2026 I think there’s a good chance that ends up happening,” he told CNBC.<\/p>\n
SpaceX trades at a lofty valuation following its IPO.<\/p>\n
AFP/Getty Images<\/p>\n
History’s verdict on giant, pricey IPOs<\/p>\n
Academic research adds another layer of caution. <\/p>\n
A long-running study of more than 9,200 IPOs by University of Florida finance professor Jay Ritter found that companies with more than $1 billion in pre-IPO revenue posted an average three-year market-adjusted return of -2.1%.\u00a0<\/p>\n
Separately, among tech companies priced above 40 times sales, 12 out of 14 trailed the broader market over their first three years.<\/p>\n
Musk was candid about his reasons for going public. <\/p>\n
He told a JPMorgan Chase livestream before the IPO that SpaceX has been cash-flow positive since around 2015 and wants to raise capital for a major growth phase, including plans to put more than 100,000 satellites in orbit and build AI data centers in space.<\/p>\n
There’s clearly a bull case. But Westly’s math is worth sitting with: three moonshots, and you need most of them to land.<\/p>\n
Related: Dan Ives spills the beans on SpaceX future<\/p>\n
#Tesla #board #member #issues #candid #message #SpaceX #stock<\/p>\n","protected":false},"excerpt":{"rendered":"
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