SpaceX's First-Ever Earnings Report Comes with Stock Under Pressure: Q2 Preview

 SpaceX's First-Ever Earnings Report Comes with Stock Under Pressure: Q2 Preview

**The rocket company's debut as a public reporting entity is here. After a $500 billion market value wipeout since its IPO, Elon Musk will face Wall Street's toughest questions yet on Tuesday—just days before a lockup expiration could flood the market with nearly a billion new shares .**

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## Introduction: A Rocket in Descent

Since its record-breaking IPO on June 12, SpaceX has experienced a trajectory that mirrors its most dramatic launches—a breathtaking ascent followed by a stomach-churning plunge. The stock rocketed to an intraday peak of $225.64 just days after its debut, only to fall more than 50% from that high . The company has lost over $500 billion in market capitalization since its first trade, leaving retail investors who jumped in at the peak nursing significant losses .

As of Monday's close, SpaceX shares traded at approximately $114.53, down roughly 15% from the $135 IPO price . The company's market cap still stands at roughly $1.5 trillion, supported by a price-to-sales ratio in the 70s—a valuation that assumes near-perfect execution across rocket launch, satellite internet, and AI infrastructure .

Tuesday's after-market earnings report represents the first time investors will see SpaceX's financials in detail as a public company . But the numbers may matter less than what CEO Elon Musk says about the future, and the looming lockup expiration on Thursday that will allow early investors to sell nearly a billion shares .

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## The Numbers Wall Street Is Watching

Analysts are expecting SpaceX to report revenue of approximately **$6.9 billion** for the second quarter, with a loss of roughly **23 to 26 cents per share** .

| Metric | Consensus Estimate |

|--------|-------------------|

| **Revenue** | ~$6.9 billion |

| **Loss Per Share** | ~$0.23–$0.26 |

| **Adjusted EBITDA** | ~$2.05 billion |

| **Capex (Q2)** | ~$13.2 billion |

The company's three business segments are expected to show a stark divergence in performance :

| Segment | Expected Revenue (Q2) |

|---------|----------------------|

| **Starlink (Connectivity)** | $3.83 billion |

| **AI (xAI/Grok)** | $2.18 billion |

| **Launch (Space)** | $835 million |

SpaceX's only profitable business last year was Starlink, which generated $11.4 billion in revenue and $4.4 billion in operating income . The connectivity unit now has more than 12 million subscribers and is the cash cow funding Musk's more ambitious projects .

The AI segment, by contrast, is a money-losing enterprise that has already burned through billions. SpaceX's capital expenditures are expected to increase from roughly $49 billion this year to over $118 billion by fiscal 2028 .

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## The Three Questions That Will Define the Call

### 1. Starlink's Growth and Profitability

Investors will be laser-focused on Starlink subscriber adds, average revenue per user, and the profitability trajectory . The segment is SpaceX's only source of positive cash flow, and its growth is critical to funding Musk's more speculative ventures. Analysts will also want to know how the recent $10 "monthly kit fee" and subscriber price increases have affected demand .

### 2. The AI Spending Spree

SpaceX has merged with Musk's xAI, bringing in the Grok AI models, data centers, and the X social network . The company is also in the process of acquiring Cursor AI for about $60 billion . But these ventures are cash incinerators. SpaceX's capital expenditures hit $10.1 billion in the first quarter, with $7.7 billion tied to AI .

The company has struck lucrative compute deals with Google, Anthropic, and Reflection AI that carry pricing two to three times typical neocloud rates . But the long-term sustainability of those contracts is a key question .

### 3. Starship's Timeline

Starship is the linchpin of SpaceX's long-term valuation . The fully reusable rocket is designed to reduce launch costs, enable rapid Starlink expansion, and eventually support orbital data centers . But the program is still in development and losing money.

The company completed its 13th Starship test flight on July 24, successfully deploying satellites, though the booster experienced a "hard splashdown" . Investors will be watching for updates on the next flight and the timeline for operational payloads, which Musk has said could begin before the end of the year .

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## The Lockup Expiration: A $100 Billion Overhang

Perhaps the biggest concern for SpaceX shareholders isn't the earnings report—it's what happens two days later. On Thursday, August 6, roughly **911 million shares** owned by insiders, employees, and early investors become eligible for sale .

That's roughly triple the current tradable float and represents about 7% of the company's total shares . Additional tranches of shares will unlock over the coming months, potentially creating a sustained overhang .

Short sellers have already amassed roughly $18.4 billion in paper profits since the IPO, and short interest remains near record highs . More than 63% of the free float is on loan to short sellers, according to Ortex Technologies, with almost no stock left to borrow .

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## Analyst Views: A Divided House

Wall Street is split on SpaceX's prospects. The stock has a **Moderate Buy** consensus rating, based on 23 Buys, six Holds, and two Sells tracked by FactSet . Price targets range from $75 to $800, reflecting the enormous uncertainty around the company's future .

**The Bulls:** Morgan Stanley maintains a $300 target, arguing the market is significantly discounting SpaceX's "implied AI value" . Bernstein has a $239 target, saying the "quarterly results should not matter" and that investors should focus on management's confidence in the growth path . Cantor Fitzgerald has a $246 target, noting the company is "approaching a bottom into the print" .

**The Bears:** Phillip Capital took the rare step of recommending investors sell SpaceX shares, with a $75 target, citing big losses and negative cash flows expected until at least 2030 . MoffettNathanson has a Neutral rating and a $131 target, warning of an "identity crisis" across SpaceX's three disparate businesses .

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## What to Watch for After the Bell

- **Will SpaceX provide guidance?** Management may be asked about full-year revenue, capex, and the path to profitability .

- **Is the Cursor deal accretive?** The $60 billion acquisition of Cursor AI is expected to close in Q3, but investors want to know what it means for the bottom line .

- **What about the Tesla merger rumors?** Reports of a potential merger with Tesla have swirled, though Musk has parried questions on the subject in the past .

- **How is the AI business performing?** Investors want to know if SpaceX's AI compute deals are generating returns and how the company plans to compete with OpenAI and Anthropic .

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## The Bottom Line

SpaceX's first earnings report as a public company is a high-stakes moment. The stock has been hammered, short sellers are circling, and a massive lockup expiration looms just two days away.

But for long-term believers in Musk's vision, the pullback could be a buying opportunity. As Freedom Capital Markets' Jay Woods put it: "This is expected to be less about the numbers and more about Elon Musk's vision, his capital spending plans and whether Wall Street is willing to continue funding one of the market's most ambitious growth stories" .

The earnings report itself may not matter as much as what Musk says about the future—and whether investors are still willing to listen.

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## Disclaimer

**IMPORTANT:** This article is for informational and educational purposes only and does not constitute financial, investment, or trading advice. The information contained herein is based on publicly available sources and reflects the author's understanding as of the publication date. Market conditions, stock prices, and company performance are subject to rapid change. Past performance is not indicative of future results. You should consult with a qualified financial advisor before making any investment decisions.