Space Exploration Technologies, better known simply as SpaceX, became a publicly traded company on Friday, nearly a quarter century after it was founded.
The company began trading on the Nasdaq Stock Exchange in New York City at $135 a share, valuing SpaceX at nearly $1.8 trillion. At the end of the trading day, the company’s shares were selling for $160.95, a respectable increase of more than 19 percent.
On paper, SpaceX founder Elon Musk became the world’s first billionaire, with a personal stake in the company valued at more than $700 billion. Due to the company’s stock option plan, thousands of current and former employees became millionaires overnight. SpaceX employees have worked very hard over the past 24 years and will now be generously compensated for doing so.
SpaceX is now one of the few most valuable companies in the world. Should it be? There is widespread disagreement over whether SpaceX is fool’s gold with its sky-high valuation, or represents a valuable opportunity to finally own a piece of a dominant space company that could one day control the in-orbit data center business.
SpaceX is now largely an artificial intelligence company
One thing is clear: SpaceX is now subject to major public disclosures and will conduct many more businesses in the public eye. Although Musk retains full autonomy in terms of ownership and voting rights, he will now be beholden to shareholders in one very important way: his company’s stock price.
Most shareholders bought SpaceX shares today so as not to be part of the company’s long-term plans to set up shop on Mars or to help NASA land humans on the Moon. Certainly some space enthusiasts did. However, most people invest in stocks to make money.
Like SpaceX made clear in its S-1 document However, unveiled in May, the company’s value does not lie in its “space-enabled solutions” or its Starlink internet constellation. As part of its “total addressable market,” the company considers these to represent less than 7 percent of its value.
Rather, Musk and SpaceX see most of their value in providing AI services, primarily from space and primarily for enterprise applications. If investors agree that this is where the vast majority of the company’s profits lie, it is where they will want SpaceX to devote its time and resources.
