SpaceX Falls Below IPO Price Amid $25 Billion Short Surge
SpaceX shares have dropped below their record $135 IPO price as bearish wagers approach $25 billion, setting up a critical test when insider lock-ups expire next month.
SpaceX (SPCX) shares slipped below their $135 initial public offering price this week, marking a sharp reversal from the $200 peak reached shortly after its historic June debut. The company has now lost roughly a third of its value from that high. The decline drags down a listing that raised $75 billion, the largest IPO on record, and wipes billions from Musk's personal fortune this month.
The rapid descent has fueled a massive buildup of short interest. Bearish bets currently stand at roughly 185 million shares, equating to 29% of the tradable float. This represents close to $25 billion in wagers against the rocket maker. The short position has ballooned from just 40 million shares three weeks ago, handing short sellers an estimated $8.7 billion in paper profits.
Musk has publicly clashed with the bears. On X, he mocked the Ivy League pedigrees of the short sellers and issued a warning, though he provided no evidence to support it and the stock continued to slide. Separately, Musk leaned into his broader worldview on abundance and resource scarcity. Replying to entrepreneur Peter Diamandis, who noted that all owned material wealth on Earth totals about $600 trillion, Musk reiterated his belief that SpaceX will eventually outvalue the Earth. He provided no details on how the company would achieve the operational milestones required to justify such a valuation.
From a technical standpoint, the stock's current level aligns with a recently identified falling wedge pattern, which points to a potential rebound toward $158. However, traders are weighing this against tangible headwinds. SpaceX scrubbed a Starship test flight this week after automated safety systems halted the countdown at T-minus zero because several Raptor engines failed to ignite. Musk confirmed two engines need replacement, with the next attempt likely coming early the following week.
Looking ahead, the market is focused squarely on August. That is when share unlocks will permit insiders to sell their holdings for the first time since the June offering. The introduction of this fresh supply poses a significant risk to the stock price. Short sellers appear willing to maintain their positions ahead of this catalyst, betting that the clash between Musk's long-term theories and near-term operational realities will continue to pressure the stock.
