Is Elon Musk selling 'Hopium' with the $1.8 trillion SpaceX IPO?
THE launch countdown is on for SpaceX.
Elon Musk's space technology company appears to be preparing for an initial public offering (IPO) on June 12, 2026. Reports swirled for weeks that SpaceX could target a valuation of $2 trillion. Recently, though, the company trimmed the figure to around $1.8 trillion.
This number will still make SpaceX the eighth-largest U.S. company by market cap (knocking Musk-led Tesla (NASDAQ: TSLA) down a spot). It will also become the largest industrial company based on market cap.
Much has been written about the upcoming IPO. However, one of the most interesting takes, in my opinion, was an article written by Ed Elson, who co-hosts the Prof G Markets podcast with NYU Stern marketing professor Scott Galloway. Elson argued in the article posted on X (formerly Twitter), which ironically is now part of SpaceX, that SpaceX's IPO filing is "unserious, empty, hallucinatory, and borderline dishonest."
Reasons for genuine excitement about the SpaceX IPO
To be sure, investors have several reasons to be genuinely excited about the SpaceX IPO. Obviously, the unprecedented size of the public offering warrants attention. SpaceX currently dominates the launch and satellite internet services markets.
Who wouldn't get excited about a business that's literally shooting for the moon -- and beyond? SpaceX already transports people and supplies to the International Space Station. It plans to land on the moon and eventually establish a human settlement on Mars. These arguably aren't pie-in-the-sky dreams. The Starship vehicle, the centre of the company's lunar and interplanetary aspirations, has been on multiple missions orbiting Earth.
Importantly, SpaceX's business is also booming. The company reported $18.7 billion in revenue in 2025, up roughly 33% year over year. Starlink, SpaceX's satellite internet service, accounted for around $11.4 billion of the total.
Although SpaceX isn't profitable yet, Starlink is. The unit's operating income topped $4.4 billion last year. The company's space segment isn't far from turning a profit, either, with a 2025 loss of $657 million.
Investors may also remember that some scoffed at Musk during Tesla's early days. Today, Tesla's market cap is near $1.4 trillion. Musk is the world's wealthiest person -- and is probably about to become the first trillionaire after SpaceX goes public.
Reasons for scepticism, too
But is Musk taking the "hopium" to another level with the SpaceX IPO? There are reasons to be skeptical about the hype over the IPO stock.
For one thing, SpaceX's revenue doesn't come close to justifying a $1.8 trillion market cap. Tesla, which isn't a value stock by any stretch of the imagination, trades at a 15.7x price-to-sales ratio. SpaceX's P/S multiple will be over 96x.
Does SpaceX's growth make its lofty valuation more palatable? Not really. In the first quarter of 2026, the company's revenue increased by 15%. That's not bad, but it's not nearly enough to support a $1.8 trillion valuation.
Meanwhile, SpaceX's bottom line is going in the wrong direction. The company's overall net loss was eight times greater in Q1 than in the prior year period.
Perhaps the biggest eyebrow-raiser with SpaceX's IPO filing, though, is its estimated total addressable market (TAM) of $28.5 trillion. The company acknowledged that this is the largest TAM "in human history." Yep. Elson noted in his article that it's also "larger than the GDP of Europe or China." He added, "If this sounds dumb to you that's because it is."
Selling "hopium"
SpaceX is a fascinating, innovative company with exceptional long-term growth prospects. Its technology is exciting. The company may achieve its goal of going to Mars. But its IPO has also been overhyped.
Some of the language in SpaceX's S1 filing was over the top, with phrases such as "extend the light of consciousness to the stars" mentioned multiple times. Most of the $28.5 trillion TAM estimate is based on Musk's dreams of building AI data centers in space. The billionaire hasn't helped matters by making comments about SpaceX's deal with Anthropic that differ from the S1 document.
Is Musk selling "hopium" with the SpaceX IPO? I think the answer is "yes" -- at least to some extent. Investors can find more attractive risk-reward propositions with other stocks.
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