The public listing of SpaceX will serve as a real stress test for the current capacity of the public market. If the offering proceeds smoothly, it will send a clear signal to the market—indicating that the window for large, high-valuation companies going public has reopened. This could also provide endorsement for other long-delayed mega-IPO projects.
SpaceX has confidentially filed for an IPO, seeking to raise over $50 billion with a potential valuation of up to $1.75 trillion, which could surpass Saudi Aramco to become the largest IPO in history. This news has reignited hope in the global large-scale IPO market, which has been quiet for years, but whether it can truly trigger a new wave of listings remains a topic of debate among market participants.
As mentioned in previous reports, SpaceX has submitted its IPO filing confidentially. If completed at the discussed scale, this issuance would far exceed Saudi Aramco's approximately $1.7 trillion IPO record set in 2019, making it the largest stock offering in history. Following the announcement, market attention on this Musk-led rocket company surged significantly, with investors closely assessing whether the public markets can absorb such a massive issuance.
Analysts pointed out that SpaceX’s IPO will serve as a real stress test for the current public market’s capacity to absorb large issuances. A successful offering would send a clear signal to the market that the window for large, high-valuation companies going public has reopened and may provide endorsement for other long-delayed mega-IPO projects. However, some argue that SpaceX is too unique, and its success may not necessarily lead to a broader recovery in the IPO market; instead, it might even crowd out other issuers by drawing substantial capital and attention.
The Largest IPO in History is Imminent
SpaceX is seeking to raise $50 billion or more, with a potential valuation of approximately $1.75 trillion. Samuel Kerr, Global Head of Mergermarket, a global equity capital markets data provider, stated: "At the scale currently being discussed, SpaceX will undoubtedly become the largest IPO in history. This will be a true test of the public market’s capacity during a period of genuine market volatility. But if any company can complete an IPO in this market environment, it is most likely SpaceX due to its immense market appeal."
The last company to complete an IPO with a valuation exceeding $1 trillion was Saudi Aramco in 2019. Since then, rising interest rates, inflationary pressures, and geopolitical tensions have caused the global large-scale IPO market to fall into a multi-year slump, with many issuers opting to wait and see, delaying their market entry. The industry generally hopes for a full recovery of large-scale IPOs by 2026.
Valuation Logic: The 'Scarce Narrative' of Rockets, Satellites, and AI
Behind SpaceX’s high valuation lies support from multiple business lines. According to Reuters’ report citing sources in January this year, SpaceX generated revenue of approximately $15 billion to $16 billion last year, with profits of about $8 billion, a rare level of profitability among tech unicorns.
In February this year, Musk announced that SpaceX had completed its acquisition of the AI startup xAI, valuing SpaceX at $1 trillion and xAI at $250 billion. According to Reuters citing sources, this merger integrates the Starship launch business, the Starlink satellite internet service, and AI capabilities under one entity.
Minmo Gahng, Assistant Professor of Finance at Cornell University, commented, "The incorporation of xAI allows Musk to package launches, Starlink, and AI into a single, scarce super-narrative. This combination is capable of supporting a valuation higher than the sum of individual listings of each business line."
A bellwether or a flash in the pan?
Analysts are sharply divided on whether SpaceX's public listing could drive an overall recovery in the IPO market. Kat Liu, Vice President of IPO research firm IPOX, expressed optimism, stating: "A successful SpaceX IPO has the potential to act as a catalyst for other large-scale IPOs, demonstrating that public markets have both the depth and appetite to absorb high-valuation, large-scale offerings, while also helping validate pricing levels in the current late-stage private equity market."
However, Brian Jacobsen, Chief Economic Strategist at Annex Wealth Management, told Reuters that SpaceX's case might serve as "either a bellwether or an omen." He noted that while enthusiasm surrounding the company is sufficient to attract investors, its highly unique nature—particularly Elon Musk’s star power—might instead divert market attention away from other aerospace stocks rather than lift the sector as a whole.
Samuel Kerr of Mergermarket warned from a market capacity perspective: "SpaceX may occupy so much market capacity that other large issuers could choose to delay their offerings, unwilling to compete within the same time window."
Current State of the IPO Market: Recovery Still Unverified
Based on current data, the overall performance of the IPO market remains lackluster. Indices tracking major newly listed stocks have consistently underperformed benchmark indices over the past 12 months, reflecting that investor enthusiasm for new listings has yet to fully recover.
Meanwhile, SpaceX is not the only super unicorn operating at a scale close to public companies. High-profile private firms like OpenAI and ByteDance now boast valuations comparable to leading components of the S&P 500, blurring the lines between public and private markets. Once SpaceX goes public, it will directly join the ranks of mega-cap companies such as Microsoft and Apple, competing for inflows of capital from retail and institutional investors.
Analysts widely believe that the outcome of SpaceX's public offering will provide crucial reference points for other large, long-delayed listings in capital-intensive industries—whether it ultimately reopens the market window or further postpones the timeline for broader market recovery.
Editor/KOKO