SpaceX eyes $1.75T IPO as analysts warn of xAI-driven losses

• Starlink gains offset by mounting xAI costs, raising sustainability questions
• Analysts cite $1.9B Q1 loss, extreme valuation multiples, and historical parallels with underperforming tech IPOs

On June 4, 2026 (UTC), CoinDesk reported that SpaceX is planning the largest IPO in U.S. history, targeting a $1.75 trillion valuation by listing 555 million Class A shares at $135 each. The announcement drew significant attention from Wall Street but also immediate pushback from analysts concerned about the gulf between the market’s enthusiasm and SpaceX’s underlying numbers.

SpaceX’s high valuation is central to analyst skepticism, especially after the company reported a $1.9 billion operating loss in the first quarter of 2026, according to CNBC on June 3. The loss was driven largely by xAI, SpaceX’s artificial intelligence arm, whose steep costs outpace profits generated by Starlink, the company’s satellite internet division.

Morningstar analysts valued SpaceX at $780 billion—less than half the IPO target—pointing to heightened sustainability risks with shares trading at 103 times sales, far beyond industry norms and previous major tech IPO launches. Their data show that companies debuting at such high multiples have often suffered steep declines.

While Starlink posted solid operating income, CNBC emphasized, xAI’s ongoing infrastructure spending wipes out those profits. Analysts noted that the AI subsidiary’s business model is still unproven, making SpaceX’s future earnings highly uncertain. They also connected the IPO’s scale with market history, where similar tech listings have underperformed the S&P 500 after launch due to stretched valuations.

Morningstar’s coverage stressed that SpaceX’s current profitability—driven largely by Starlink—cannot justify the IPO’s premium pricing. Persistent operating losses and an aggressive valuation amplify investor risk, echoing concerns from both CNBC and Morningstar about paying for uncertain growth—a pattern seen in tech IPOs that declined after listing.

In summary, SpaceX’s IPO marks a historic moment with a $1.75 trillion target, reflecting bullish expectations for future technology. Yet analysts caution that Starlink’s profitability is overshadowed by ongoing xAI losses, and the IPO’s multiples point to clear risks for investors, as reported by both CNBC and Morningstar.