SpaceX eyes $1.75T IPO — FT Alphaville breaks down the 'biggest bag holder operation in history'

Summary

SpaceX is targeting a $1.75 trillion IPO valuation, a figure FT Alphaville describes as 'the biggest bag holder operation in history.' SpaceX generated $8 billion in EBITDA on $16 billion in revenue last year, strong numbers that nonetheless make $1.75 trillion hard to justify on conventional metrics. The recent merger with xAI compounds the problem. xAI carried a $250 billion valuation despite only $210 million in revenue and $9.5 billion in cash burn through the first nine months of 2025. Post-merger, SpaceX revenues are projected at $22 to $24 billion for 2026, with investors presumably anchoring to higher 2027 numbers.

The $1.75 trillion target represents a rerating of more than 7x the roughly $250 billion private valuation recorded in October 2024. Musk has since marked the private valuation up to $1 trillion, citing Starlink revenue growth. To float at $1.75 trillion, prospective investors would need to make what Alphaville calls 'comic book heroic assumptions' about sustained hypergrowth.

Lockup and index dynamics

A standard six-month lockup is widely seen as insufficient given two decades of stock grants and accumulated investor positions. A staggered structure similar to Facebook's IPO is the more likely outcome. Even a 3% float at the mooted valuation would eclipse Alibaba's $25 billion 2014 record, currently the largest US IPO. NASDAQ has already proposed rule changes to accommodate mega listings. Index inclusion is also a live question, as passive buying pressure from NASDAQ 100 and S&P 500 inclusion could provide significant technical support post-listing. The timing of that buying relative to lockup expirations is a key variable.

Retail demand

SpaceX's story is simpler than Tesla's. Mars, Starlink, and launch dominance give retail investors a single coherent narrative without the need to cycle through Cybertruck, robotaxis, or Optimus. The IPO is reportedly being structured to include a meaningful retail allocation, which makes the composition of the order book a pointed question. How much of the demand reflects genuine long-term conviction, how much is political signaling, and how much goes to unconnected institutional investors rather than insiders and strategic partners are among the five questions Alphaville puts to prospective investors. The others are what growth rates actually justify $1.75 trillion, and what the specific lockup expiration schedule will look like.

Kalshi currently prices the probability of a formal IPO announcement before August 1, 2026 at 79%.