Elon Musk's SpaceX Wipes Out $600B As Record IPO Mania Cools

SpaceX shares fell for a second straight session Thursday, wiping out more than $600 billion in value and raising doubts about the largest IPO ever.

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SpaceX Stock Slides After Cursor Deal

The two-day retreat has wiped more than $600 billion from the company's value, undoing much of a record-setting debut that had briefly made it one of the world's most valuable firms. Shares had climbed as high as $225.64 on Jun. 16, a near-50% jump from the $135 offer, the sort of vertical run that often draws profit-taking.

The selloff traces to a deal to buy Anysphere, the startup behind AI coding tool Cursor, for $60 billion in stock. Elon Musk agreed to the all-stock purchase days after the listing, a move that dilutes existing holders by about 3.4%. The transaction is set to close in the third quarter, will not draw on IPO proceeds, and hands the company a tool used by more than a million developers.

Morningstar trimmed its fair value estimate to $62 from $63, citing dilution from a stock it had already judged overvalued even under a best case it pegs near $169.

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Analysts Split On SpaceX Valuation

Not every read is bearish. Oppenheimer analyst Timothy Horan raised his target to $250 from $190, pointing to the engineering talent, training data and developer base the Cursor deal hands the company.

The pace of the reversal shows how much sentiment drove the early run.

Retail investors poured about $369.8 million into the stock over its first three sessions, more than four times the flow into Nvidia in the same span, before that buying cooled. Buyers who took allocations near $135 still hold gains, while many who chased shares higher in the open market now sit on paper losses.

SpaceX Faces A Supply Test

The stock held a gain of more than 30% over its offer price even after the pullback. Supply pressure is building, though, as a bond offering of at least $20 billion tied to its AI expansion and an approaching lockup expiry both threaten to swell the tradeable float.

The week capped an extraordinary debut for a firm that raised about $75 billion at the largest IPO on record and briefly passed Amazon and Microsoft in value.

SpaceX posted $18.7 billion in revenue last year, against a $4.9 billion loss after taking on debt from xAI, the AI unit it bought in February. The Cursor deal extends that AI push, even as the market now reprices how much of the post-listing rally rested on sentiment.

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