Key Takeaways
- Kevin O’Leary declined his initial SpaceX IPO shares but is now monitoring the $100-$110 price zone for potential entry after volatility subsides
- Second quarter revenue reached $7.81 billion, representing a 91.9% year-over-year increase and surpassing consensus forecasts of $6.9 billion
- The company reported an earnings per share loss of $0.09, significantly outperforming the anticipated $0.26 deficit; Starlink user base expanded to 12 million
- SPCX shares have declined over 25% from their June 12 IPO price, with lockup period expirations creating additional downward pressure
- Argus Research raised its rating to Buy with a $160 target; consensus analyst price objective stands at $227.31
SpaceX (SPCX) began Friday’s session at $114.92, continuing to trade significantly below its post-market debut peaks. Shares have retreated more than 25% since the company went public on June 12, touching a bottom of $104.83, despite posting impressive quarterly financial results.
Space Exploration Technologies Corp., SPCX
Second quarter revenues totaled $7.81 billion, marking a 91.9% year-over-year jump and exceeding analyst expectations of $6.9 billion. The aerospace manufacturer reported a loss per share of only $0.09, substantially better than the projected $0.26 deficit.
The Starlink satellite internet service saw its subscriber count reach 12 million, a doubling from the previous period. Artificial intelligence-related revenue experienced an approximate 250% surge. The company’s operating deficit contracted dramatically to $143 million compared to $970 million in the comparable year-ago quarter.
Capital investments during the three-month period exceeded $18 billion, with $15.83 billion allocated specifically to AI infrastructure development. This aggressive spending pattern represents the primary concern for skeptical investors, particularly as the company continues to report GAAP losses.
CEO Elon Musk indicated that SpaceX anticipates reaching a $100 billion annual revenue trajectory by year-end. Chief Financial Officer Bret Johnsen disclosed that $6.7 billion worth of cloud services agreements are scheduled to commence scaling up in October.
Wall Street Maintains Optimistic Outlook Amid Price Decline
Argus Research elevated its recommendation on SPCX from Hold to Buy this Friday, establishing a $160 price objective. This forecast suggests approximately 39% appreciation potential from recent trading levels.
The analyst community broadly maintains a positive stance. Among 39 professionals tracking the equity, three assign it a Strong Buy rating, 26 recommend Buy, eight suggest Hold, and two advise Sell. The mean price projection reaches $227.31.
Deutsche Bank maintains the most aggressive forecast at $255. Citigroup’s target stands at $200. Royal Bank of Canada reaffirmed its Outperform designation with a $225 objective. Moffett Nathanson takes a more conservative approach, assigning a Neutral rating with a $131 target.
RBC’s Ken Herbert characterized the second quarter performance as “positive.” Zacks Investment Research strategist Brian Mulberry highlighted the AI revenue monetization as representing a “tremendous upside surprise.”
O’Leary Adopts Wait-and-See Strategy
Celebrity investor Kevin O’Leary revealed he declined his IPO share allocation due to liquidity apprehensions. He’s currently monitoring the $100 to $110 price band as a prospective buying opportunity.
“As the stock settles over the next 30 to 60 days, I’ll be watching closely, and I may start building a position,” O’Leary posted on X.
He maintains that SpaceX cannot be properly assessed using conventional single-quarter valuation methodologies. His investment thesis focuses on the possibility of Musk integrating SpaceX with Tesla, robotics platforms, artificial intelligence capabilities, and self-driving technology into a comprehensive interconnected ecosystem.
Share Lockup Releases Continue Weighing on Price
The initial lockup expiration that occurred Thursday freed 911.5 million additional shares for trading, effectively more than doubling the publicly available float. Retail investor demand absorbed a portion of this supply, though additional scheduled unlocking events extend through December.
SpaceX and Tesla jointly confirmed a preliminary $16.8 billion commitment to the Terafab semiconductor manufacturing facility in Texas. The organization also announced initiatives for space-based AI computing centers and an expanded mobile telecommunications network.
SPCX currently trades between a 52-week high of $225.64 and a 52-week low of $104.83. The company’s debt-to-equity ratio registers at 0.83.
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