SpaceX shares slump more than 50% from peak as investors await first earnings result

SpaceX shares have declined more than 50 percent from their post-IPO peak to around $113.50, as the company approaches its first earnings report on August 4, 2026. 

Investors’ concerns regarding cash burn, Starship test results, and an upcoming lock-up expiration on August 6 have pressured the stock below its $135 IPO price.

SpaceX stock has plunged over 50 percent from its post-listing peak of $225.64, down to near $113, erasing market value following its blockbuster June 12 IPO priced at $135.

Shares surged to $225.64 days after listing before declining to $113, a decline below the initial $135 IPO price.

Analysts attribute the drop to cooling initial hype, high price-to-sales ratios, heavy AI spending plans, and upcoming lock-up expirations.

SpaceX debuted on the Nasdaq in June 2026 at $135 per share in a historic $75 billion initial public offering. Early retail and institutional demand pushed the stock to a peak of over $225.

However, the initial euphoria has given way to a broad reassessment as markets shift their attention from future potential to financial performance, profitability and execution.

With a market capitalisation of about $1.5 trillion, SpaceX remains one of the world’s most valuable publicly traded companies despite the recent correction.

Why is SpaceX’s share price falling?

Market analysts believe the decline is being driven by several factors rather than a deterioration in the company’s underlying business.

The biggest concern is valuation, but it is tied to deeper operational and structural issues following its public listing.

Unlike traditional aerospace companies, SpaceX is priced as a long-term technology platform spanning commercial launches, satellite internet, artificial intelligence infrastructure, defence contracts and future deep-space transportation. 

Investors are also preparing for what is expected to be the company’s first earnings release as a listed company, widely anticipated in early August. The report is expected to provide the clearest picture yet of how quickly SpaceX can convert its technological leadership into sustainable earnings growth.

Another source of caution is the anticipated expiry of insider lock-up restrictions, which could allow early investors and employees to sell shares into the market, potentially increasing supply and adding to short-term volatility.

Momentum stock to valuation test

Companies that command enormous investor excitement at listing often experience significant corrections once markets begin evaluating earnings instead of future expectations; hence the sharp decline mirrors a pattern seen in several high-profile technology IPOs. 

For SpaceX, the execution will largely depend on continued growth in its core businesses, which are Starlink satellite broadband, commercial launch services, government and defence contracts, artificial intelligence infrastructure, and development of the Starship programme.

Strong execution across these businesses could justify today’s premium valuation, while weaker-than-expected results could prolong the stock’s decline.

Morgan Stanley remains bullish

Despite the recent sell-off, several Wall Street analysts believe investors have become overly pessimistic.

Adam Jonas, Morgan Stanley analyst, maintains an overweight rating and a $300 price target on SpaceX, arguing that a drop to $100 per share implies the market assigns zero value to its artificial intelligence business.

He noted that a share price of around $100 would effectively imply that investors are assigning virtually no value to the company’s artificial intelligence business.

Jonas values SpaceX’s core space and connectivity operations at about $136 per share, supporting an overall long-term price target of $300 while noting that the remainder of the valuation relies heavily on the company’s artificial intelligence (AI) infrastructure potential.

Analyst expectations remain widely divided

The recent correction has not eliminated optimism among analysts, although expectations vary considerably.

According to market data compiled by Investing.com, analysts’ average price target remains well above the current share price, which reflects confidence that the business can recover if it delivers strong earnings growth. 

However, the wide range between bullish and bearish estimates also highlights the uncertainty surrounding the company’s valuation and future cash flows.

What investors are watching

The next major driver for SpaceX shares will be its expected earnings announcement in early August.

Investors will be looking out for revenue growth from Starlink, profitability of launch operations, updates on artificial intelligence investments, progress on Starship development, management’s outlook for revenue and margins, and any guidance on future capital expenditure.

The earnings report is expected to determine if the current sell-off represents a buying opportunity or the beginning of a longer valuation reset.

During its IPO, investors were willing to pay a premium for the company’s long-term vision. Now, the market wants evidence that SpaceX can generate the earnings and cash flow needed to support one of the highest valuations in global equity markets.

If the upcoming earnings report demonstrates strong revenue growth, improving margins and continued momentum across Starlink and launch services, analysts believe the stock could regain investor confidence. 

However, weaker-than-expected results or cautious guidance could intensify selling pressure.

For now, SpaceX remains one of Wall Street’s most closely watched companies because investors are trying to determine if its trillion-dollar valuation can be justified by its financial performance over the coming years.