Earlier this week, SpaceX investors were encouraged by a first-quarter earnings call that included bold long-term AI-driven revenue projections. Now, they face a more practical but important challenge: a major share unlock that could bring new volatility to the stock.
On Wednesday, shares dropped 12% even though SpaceX had a strong first quarter as a public company. Sales reached $7.8 billion, beating Wall Street’s $6.8 billion estimate. The company’s AI division also surprised analysts by posting $1.1 billion in earnings before interest, taxes, depreciation, and amortization, instead of the expected modest loss.
Even with strong results, the stock still dropped. This makes more sense in context. Shares had already climbed nearly 16% on Monday and Tuesday before the report, so by Thursday, the stock was only slightly down for the week. The early-week rally was likely due in part to short sellers adjusting their positions before earnings, since many investors had borrowed and sold SpaceX stock short, expecting it to fall.
A big reason for this bearish outlook is the upcoming share unlock. Soon, a large amount of stock held by insiders and early investors will be available to trade. If many decide to sell, it could put pressure on the share price, since the chance of short-term declines often keeps buyers away. This can affect any stock, even one led by Elon Musk, who has said SpaceX could reach $1 trillion in annual sales by 2029. That goal is much higher than Wall Street’s own estimate of $284 billion for that year.
The unlock process starts Thursday, when up to 911.5 million shares will become available to trade, according to the company’s amended prospectus. This is more than 140% of the stock currently available after the IPO. About 319 million more shares will unlock on August 12 and again 20 days later. By the end of the year, over 4 billion shares could be tradable. Musk’s own holdings of 6.4 billion shares, including options, will become tradable in June 2027, but he is not expected to sell.
Investors will probably need to watch the unlock schedule for several weeks or even months. After the IPO overhang is gone, SpaceX shares should start to reflect the company’s real fundamentals more closely, though there will still be debate about what those fundamentals mean for the stock.
