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đź—ž SpaceX: Here's What You Get For $1.75 Trillion

The largest IPO in history. Here are the numbers that matter.

Written by: Ryan Henderson & Braden Dennis

Happy Sunday! đź‘‹ 

Today, we’re taking a look at the numbers behind what will likely be the largest IPO in history — SpaceX.

Let’s dive in!

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SpaceX: Here’s What You Get For $1.75 Trillion

On Wednesday, Space Exploration Technologies Corp. (SpaceX) filed their Form S-1 with the SEC, officially announcing their intent to go public.

Shares are planned to start trading on June 12th, in what should be (assuming all goes well) the world’s largest ever public offering. According to estimates, SpaceX is hoping to raise $75-$80 billion at a $1.75 trillion valuation. That would be roughly 3x bigger than the current largest ever — Saudi Aramco’s 2019 IPO.

And with the drop of the S-1, we now have full visibility into the SpaceX financials, so let’s dig in.

The 10,000 Foot View

SpaceX is divided into 3 subsidiaries: Space, Connectivity, and AI.

Combined, the 3 businesses generated $18.7 billion in revenue (+33% YoY) and $4.9 billion in net losses in 2025, as they’re investing heavily for growth across all 3 segments.

But the real standout number was in the cash flow statement. In the first quarter of 2026, SpaceX spent $10.1 billion on capital expenditures, compared to cash flow from operations of $1.04 billion. That puts their Q1 free cash flow at -$9.1 billion.

Let me reiterate that. SpaceX had a free cash burn of $9.1 billion in the first quarter. That’s the second highest quarterly cash burn in the world, behind only Oracle.

We’ll get into where that money is being spent in a second, but first, let’s walk through the individual segments.

This is likely what most people think of when they hear the name “SpaceX”.

This segment refers to the design, manufacturing, and launching of reusable rockets for both internal purposes (Starlink) and 3rd party customers looking to place satellites into orbit. Right now, SpaceX is operating two rockets for commercial use, the Falcon 9 and the Falcon Heavy. On reusable launches, Falcon 9 offers a payload capacity of up to 17.5 metric tons, while Falcon Heavy offers 30 to 40 metric tons. Combined, the Falcon rockets completed 165 launches in 2025.

With the Falcon launch services now well established, the main growth opportunity is Starship. An estimated $15 billion has been spent on developing Starship, and it’s stated to have a potential payload capacity of 100 metric tons, or ~5x larger than the Falcon 9. While Starship has completed several successful test launches, the vehicle has not yet been approved for commercial use. If it does eventually receive commercial approval, this would be a drastic change in the types of payloads that they could launch. Importantly, research suggests that Starship would make building data centers in space far more practical.

In 2025, this segment only accounted for 22% of SpaceX’s overall revenue. However, despite not being the leading revenue contributor, having the most efficient launch services business in the world is a massive competitive advantage for SpaceX’s other divisions.

Connectivity was probably the clearest bright spot in the S-1.

This segment refers to Starlink, the leading low-earth orbit satellite internet provider.

Starlink is not only the largest revenue generator for SpaceX (61% of overall revenue), but it’s also surprisingly profitable. In 2025, on $11.4 billion in revenue, Starlink generated $4.4 billion in operating income — for a ~39% operating margin.

The big reason they’re able to look so profitable is they don’t have to pay “a toll”. As a subsidiary of SpaceX, they don’t have to pay the commercial rate that external customers have to pay in order to book a Falcon 9 launch. This not only helps costs, but it gives them priority access to get more satellites into space to improve their internet speeds and attract more customers. That’s exactly what they’ve done.

As of Q1, Starlink had 10.3 million subscribers. At the start of 2024, they had 2.3 million subscribers. That’s ~4.5x growth in less than 3 years.

For reference, that’s almost as many internet customers as AT&T.

This is where the story gets a little bit complicated.

Revenue for “Artificial Intelligence” comes from 1) Advertising (aka Twitter/X), 2) Subscriptions to Grok/X, and 3) Selling AI compute capacity. 

The 3rd one there is what has investors a bit perplexed.

In 2024, X started building data centers for its consumer-facing AI chatbot called Grok. Grok leverages the information stream (350 million daily posts) from Twitter/X to provide real-time responses to user queries. So far, this seems to have been a moderate success, as SuperGrok has 1.9 million paid subscribers. For reference, ChatGPT has an estimated 50 million paying subs.

However, in May 2026, the company started repurposing some of that compute capacity to start selling to someone else. Here’s the snippet from the S-1:

“In May 2026, we entered into Cloud Services Agreements with Anthropic PBC (“Anthropic”), an AI research and development public benefit corporation, with respect to access to compute capacity across COLOSSUS and COLOSSUS II. Pursuant to these agreements, the customer has agreed to pay us $1.25 billion per month through May 2029, with capacity ramping in May and June 2026 at a reduced fee.”

So Anthropic is set to start paying $15 billion per year to xAI for compute capacity. That will be a massive jump in revenue considering that the entire SpaceX AI division earned just $3.2 billion in 2025.

However, as we’ve seen from the other public cloud providers (Amazon, Microsoft, & Google), building out data centers is highly capital intensive, and so far, xAI has been no exception.

Despite accounting for just 17% of SpaceX’s revenue in Q1, the AI segment accounted for 87% of total capital expenditures. 

While this is creating a massive drag on cash flow at the moment, and likely will for the foreseeable future, there is one long-term opportunity here that should excite investors. Data centers in space.

Even though it sounds farfetched, there are many companies looking to build data centers in space as the conditions are apparently somewhat favorable. Data centers could, in theory, have unlimited solar power (no cloud cover or nighttime in a sun-synchronized orbit), they wouldn’t require as much water, and they would avoid much of the current societal backlash around data centers.

While this is still theoretical, xAI would have a considerable advantage over peers since it operates under the same umbrella as the company providing the rides to low-earth orbit.

Musk’s Compensation

This was perhaps the craziest (coolest?) part of the entire ~400-page document.

“On January 13, 2026, our board approved the grant of 1 billion performance-based restricted shares of Class B common stock to Mr. Musk. The restricted shares vest upon (i) our achievement of specified market capitalization milestones across 15 equal tranches and (ii) the Company’s establishment of a permanent human colony on Mars with at least one million inhabitants, in each case, subject to Mr. Musk’s continued employment with us through the date on which achievement is certified by our board. For any tranche of the award to vest, both the applicable market capitalization milestone for such tranche and the human colony milestone must be met.”

That’s right. Elon’s compensation is predicated on market cap hurdles, and…

*checks notes*

A one million person human colony on Mars.

Is it worth $1.75 trillion? 

At $1.75 trillion, SpaceX would be trading at more than 100× 2025 revenue and 300× 2025 (heavily) adjusted EBITDA. I know it’s easy to get desensitized to headline multiples when times are good, but that’s a steep price to pay, especially considering some of the other businesses available in a similar price range:

On June 12th, we’ll find out what the market thinks.

That’s all for this week. 

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