Can SpaceX’s First Earnings Call Ease Pressure from Looming Lockup Expirations?

Even a killer earnings report may not be enough to help SpaceX stock escape the gravitational pull of lockup expiration dates. Not that sky-high financials are exactly expected at today’s inaugural quarterly earnings call for Elon Musk’s rockets and AI empire. 

The real test for the newly public firm comes this Thursday, when a major tranche of insider shares exit their lockup period. The expiration could fuel a selloff that sends its share price, already down some 20% from its IPO, even lower. Rest assured, short-selling sharks are betting on it.

(Space)X-it Strategy

When SpaceX debuted at $135 per share in early June, 640 million shares, or less than 5% of total shares, were made available to the public. On Thursday, after the company has already shed hundreds of billions in value since its debut, employees and early investors will be able to sell another 911 million shares, amounting to another 12% of the company’s total. 

That creates even stronger headwinds for the shares, since many of those insiders have committed that stock toward “private islands, cars, whatever,” as venture capitalist Paul Kedrosky recently and colorfully told Axios. (We imagine homes and retirement funds are slightly more likely outcomes.) 

That’s been enough to draw in the short-sellers, who have already made a killing:

• Short interest stood at about 34% of all publicly available shares as of last week, according to S3 Partners data. As of Friday, short sellers had already booked about $8.3 billion in paper profits since the company’s debut in June, S3 Partners told CNBC. 
• “It’s among the most aggressive and quickest bearish builds we have seen in a mega-cap name heading into its first earnings report post-IPO,” S3 Partners research head Matthew Unterman told CNBC. Shares of the company did pop more than 5% on Monday amid a broader tech rally. 

Take the Wheel: SpaceX investors will be looking for signs of stabilization from the company today. Revenue guidance and capex projections for its AI unit will be a particular focus (sound familiar?); the company has already struck deals with Google and Anthropic to supply compute this year, and the promise of spacebound data centers still lingers. On a more terrestrial note, The Wall Street Journal last week reported that Tesla is weighing a sale or spinoff of its China business as it considers a possible merger with SpaceX. Such a merger could help fast-track the company’s inclusion in the S&P 500.