By most accounts, SpaceX’s 14th Starship test flight on Monday was an overwhelming success.
Sure there were problems. A vacuum Raptor engine failure had engineers teetering on cutting the mission short and falling well short of the company’s original goal of circling the Earth six times. But the enormous rocket — the most powerful ever built — took to the skies, leaving its Super Heavy booster behind and settling in a stable orbit just over 171 miles over the Earth roughly 20 minutes into the launch. It effortlessly released 26 V3 Starlink satellites in orbit. It even managed to decelerate, right itself, and gently splash down in the Pacific Ocean, as planned.
But investors were seemingly unimpressed by the ordeal. SpaceX’s stock slid by just over two percent on Monday and is now hovering lower than it was a week ago. It’s a counterintuitive market reaction that has SpaceX backers baffled.
“Explain to me why the stock is down over one percent right now from the opening,” one confused investor tweeted. “SpaceX just delivered [S]tarlink V3s into orbit. The stock should be going through the roof.”
“Financial markets are clueless to how big of a deal this is,” another wrote.
It’s true that Starship plays an outsize role in the success of SpaceX. CEO Elon Musk has made the rocket a cornerstone of its future endeavors, from greatly accelerating the buildout of its Starlink megaconstellation to taking astronauts to the surface of the Moon.
But given the bearish outlook from SpaceX stakeholders, Monday’s launch wasn’t exactly a home run. Some accounts on Musk’s social media platform X suggested the success was already priced in to the company’s shares. In other words, the outcome of this week’s launch may have already been considered a given before it even happened.
Then there’s the fact that SpaceX is being traded at a valuation of just under $2 trillion, a massively overinflated figure considering the fact that the company’s still losing billions of dollars a year. Its recent merger with Musk’s AI lab, xAI, has pushed the space company even further into the red and brought uncomfortable optics to what’s generally been one of Musk’s most accomplished ventures.
While SpaceX has since promised to pay back billions of dollars in debt, it’s still unclear where the revenue will actually come from. The company’s top two sources of income are renting out AI compute and its Starlink internet broadband service, but its enormous expenditures still massively outweigh the money it’s currently bringing in.
The company’s stock has also been under increased pressure as up to 328 million shares became eligible for sale last week, kicking off a sharp selloff.
Then there are SpaceX’s continued rocket engine woes. As Reuters reports, Monday’s single Raptor engine failure, an unexpected shutdown after booster separation, could endanger its plans to meet NASA’s highly ambitious Moon mission objectives.
Monday’s launch also concluded after just over three hours, falling well short of its originally envisioned flight duration of almost ten hours.
In short, there are clearly plenty of factors at play that stopped a major spike in SpaceX’s share price this week. While Musk’s most exuberant fans are crying foul, blaming the media for reporting on what went wrong during this week’s launch, it’s clear that investors are continuing to ask some tough questions.
SpaceX’s shares recovered slightly after the opening bell on Tuesday. But the company has its work cut out to recover the losses following its mid-June IPO — a moment in time when the stock was trading almost ten percent higher than it is today.
More on SpaceX: SpaceX Stock Slides After What Should Have Been Its Triumphant Moment With Starship