SpaceX Sheds $600 Billion in Three Days as It Taps the Bond Market for the First Time
Poinews.com – On Monday, SpaceX’s stock ended the session at $154.63, marking a 16% decline for the day. This brought the share price close to the $150 level it had initially reached when public trading commenced, a benchmark set once underwriters finalized the order book. Despite this, it remained above the $135 price at which the company’s IPO was launched. The recent drop has wiped out over $600 billion (€524.2bn) in market value within just three trading days, pushing its valuation down from a peak that briefly surpassed Amazon and, for a short time, Microsoft.
SpaceX’s valuation now hovers just above $2 trillion (€1.74tn), placing it as the seventh-largest company globally. This shift undoes a dramatic early surge, which saw shares rise from approximately $150 on June 12 to nearly $226 by June 16—a gain of roughly two-thirds before the company released its first financial results as a public entity. The current price is 30% lower than that high, yet still 3% higher than the IPO opening. The initial rally relied heavily on a limited number of freely traded shares and optimistic projections for its AI ventures, leaving it vulnerable to a swift reversal when market sentiment shifted.
First Debt Offering Signals Strategic Shift
The latest downturn coincided with SpaceX’s debut in the corporate debt market. The company launched its first senior unsecured notes offering, with insiders estimating the target at around $20 billion (€17.4bn). Funds from this sale are primarily intended to settle a bridge loan secured during its merger with Elon Musk’s AI startup xAI earlier this year, with leftover proceeds allocated to broader operational needs.
“The company’s balance sheet reflects a mix of substantial cash reserves and new debt, raising questions about its financial strategy as it scales AI and data center initiatives,” noted a financial analyst in a recent report.
SpaceX’s decision to issue bonds instead of equity shares aims to shield existing investors from further dilution. This approach maintains their ownership stakes while providing the capital needed for expansion. The move follows credit ratings upgrades from Moody’s, Fitch, and S&P Global, which were awarded last Friday. These ratings, at Baa1, BBB+, and BBB respectively, open the door to more favorable borrowing terms and access to a wider range of institutional lenders.
According to documents related to the offering, SpaceX held roughly $100.8 billion (€88bn) in cash as of June 19, much of it raised through its IPO, alongside $29.1 billion (€25.4bn) in long-term debt. This combination of significant liquidity and fresh borrowing has sparked mixed reactions among investors, with some viewing the rapid fundraising as a precursor to increased spending on its ambitious AI and data center projects.
