SpaceX’s $1.77 trillion IPO was, by any measure, historic. Whether it was justified is a different question.
Keith Snyder, a senior equity analyst at the Center for Financial Research and Analysis (CFRA), says he can only match SpaceX’s current $2 trillion market cap by factoring in “almost comical growth for AI”—and still falling short. His estimate: xAI accounts for 71% of SpaceX’s valuation. “I hope most investors did not give that number weight,” he said of the S-1’s AI projections.
To be sure, one part of SpaceX’s rocket and satellite business is profitable and dominant—Starlink counts millions of paying subscribers globally. And bulls argue that xAI is early-stage; Grok’s integration into X gives it a distribution edge; and enterprise adoption curves for AI products can inflect sharply. SpaceX did not respond to Fortune’s request for comment.
The S-1 gave investors something to dream on: SpaceX claimed 93% of its total addressable market would be “in AI”—a figure roughly equivalent to U.S. annual GDP, or $26.5 trillion. “This is an Elon Musk company, so Elon Musk numbers are wildly optimistic,” Snyder told Fortune. “And so the TAM number that they came out with, I have absolutely no idea how they arrived at [that].”
