The Biggest IPO in History Is Coming. Here's Why SpaceX at $1.75 Trillion Doesn't Add Up.

SpaceX just filed paperwork to go public and it could potentially become the largest initial public offering (IPO) in history.

An initial public offering, or IPO, is when a private company sells shares of its stock to the public for the first time. Prior to an IPO, only a few individuals who invested in the company in its start-up phase own pieces of it. After an IPO, anyone can buy shares in the company.

SpaceX is targeting a valuation of $1.75 trillion and plans to raise $50 to $75 billion through its IPO. This would surpass Saudi Arabia's oil giant Aramco, which hit $1.7 trillion in 2019 and raised $25 billion. Yet SpaceX will not be alone in the public markets this year. OpenAI and Anthropic are also planning to go public. But first, let’s get into the company itself, because the figures alone are impressive.

What SpaceX Actually Is Now

SpaceX is not a rocket company any longer. Instead, over 70% of the company’s revenue comes from another subsidiary: Starlink.

Starlink provides internet to customers from orbiting satellites. It has deployed 10,000 small satellites that beam signals to over 9 million subscribers in more than 125 countries. These signals can reach areas that are either too remote for other internet providers to lay fiber, dig trenches, and plant their equipment.

In 2025, the company earned $10.6 billion from its Starlink satellite program. That number is projected to reach $24 billion this year. Additionally, the number of subscribers has doubled every year for the past three years. SpaceX owns and operates all aspects of the company. It builds its rockets, launches its satellites, and manufactures its internet terminals. This vertical integration allows the company to keep costs low. Where other internet providers must drill trenches in rural areas like Indonesia to lay fiber, SpaceX can provide internet access to the same subscriber at the same cost as if they lived in Montana.

Furthermore, its competition is steep. Amazon owns another satellite provider, Kuiper. So far, it has spent $10 billion on the project and launched fewer than 100 satellites. SpaceX has deployed 10,000+. No company comes close to its lead in the market.

Why I Think It's Overvalued

At $1.75 trillion, you're paying for SpaceX roughly 90 times its 2025 revenue. The price to sales ratio is one of the simplest indicators of whether a company is cheap or expensive. Divide a company's valuation by its revenues, and the higher the number, the more an investor is paying for the business.

The average company in the S&P 500 indices trades at around 3 times revenue. SpaceX is asking for 113 times revenue.

Then there's the issue of the xAI merger with SpaceX. The rocket company took over Elon Musk’s AI company, which created Grok, in February. While the move gave SpaceX AI capabilities in its satellites, it also came with $1 billion per month in computing costs. Furthermore, all of the original founders of xAI have departed from the company before or after the merger was announced.

Another issue is the orbital data center. Musk has said that the AI data centers will eventually run in space using the Starlink satellites. While this is a fantastic concept, it is still a concept. The company is asking investors to pay for its 2026 revenue and profits for a concept that will not become a reality until 2035.

The Counter Argument

The argument for SpaceX stock value is that the company’s satellite program, Starlink, is a monopoly of infrastructure that grows at 100% annually. Furthermore, SpaceX has published internal documents that project 60% margins in revenue and profit for the program once it reaches 100 million subscribers.

People who support the stock value of SpaceX say that the company is more than the valuation tools show; it has potential across a variety of areas. When the future of SpaceX comes to pass, people will look at the stock as undervalued.

Even though this is a solid argument, the 113 times revenue valuation is still asking for a lot from the company. Furthermore, even if the future of SpaceX develops as projected, the stock price will likely stall out at a more normalized valuation.

It's Not Just SpaceX

SpaceX isn’t going public alone. This year will see three of the largest technology company IPOs in history occur within six months of one another.

OpenAI is targeting a late 2026 listing and is projecting a $1 trillion value for the company. They just closed a $122 billion funding round that valued the company at $852 billion. They are currently making around $25 billion in revenue this year, but are projecting $14 billion in losses. Sam Altman, the company’s CEO, wants to go public soon. However, Sarah Friar, the company’s CFO, said that they are not ready for public markets. Hundreds of institutional investors were contacted for capital, but no one was willing to invest in the company at its current valuation.

Anthropic, the maker of the Claude AI line of products, is targeting an October listing that will raise over $60 billion. The company is also experiencing rapid growth in its revenue, going from $1 billion in late 2024 to $30 billion in early 2026. No company in history has achieved such rapid growth to such a size. However, the company plans to invest $19 billion in AI data center infrastructure this year, which would be as much as they make in total revenue.

The markets can probably handle one of these company initial offerings. However, three at the same time would be a stress test on the markets. The United States raised around $45 billion from IPOs last year. The three companies listed would raise over $240 billion.

Why This Moment Is So Strange

The world is in the middle of a war that has pushed the price of oil above $100 a barrel. Shares in technology companies are dropping in value. The credit markets are beginning to crack under the weight of the financial crisis. Despite all of this, the stock markets will soon attempt to list three of the largest technology companies in history.

It is possible that this will be the moment when these markets and valuations will change forever and look cheap in five years time. However, it is also possible that 2026 will be remembered as the year when the tech sector experienced an enormous boom, just as 1999 will be remembered for the internet bubble. Whatever happens, it is a moment in time that will go into the history books. Therefore, pay attention to what is about to happen on the markets.