SpaceX IPO raises $85.7 billion, valuation tops $2 trillion

SpaceX has raised a total of $85.7 billion in its historic initial public offering (IPO). This final figure was reached after the financial institutions managing the IPO exercised their option to purchase the maximum amount of shares available. The space exploration and artificial intelligence company, led by CEO Elon Musk, had initially raised $75 billion. Even before the financial institutions exercised their option to purchase the additional shares, the initial $75 billion figure was already sufficient to make the transaction the largest IPO windfall in history. The final $85.7 billion total further solidifies the offering’s historic scale as the company officially transitions to the public markets.

According to the company, SpaceX plans to use the proceeds from the historic offering in a variety of ways. A significant portion of the capital will be directed toward clearing liabilities from other businesses associated with Musk that were integrated into the company prior to the public listing. Specifically, SpaceX plans to use the funds to:

• Extinguish around $20 billion in debt related to legacy loans tied to X (the social media platform formerly known as Twitter) and Musk’s artificial intelligence company xAI, both of which were combined into SpaceX before the IPO.
• Expand SpaceX’s artificial intelligence compute infrastructure.
• Enhance the company’s launch infrastructure.
• Improve Starlink, its satellite internet business.

The company’s shares officially began trading on Friday on the Nasdaq, the US stock exchange. By the end of its first day of trading on Friday, SpaceX finished with a market valuation of more than $2 trillion. This valuation milestone officially made Musk, the company’s CEO, the world’s first trillionaire. The upward momentum continued into the following week, with shares climbing higher on Monday. This subsequent rise in share price helped SpaceX’s valuation eclipse that of TSMC, the semiconductor chipmaker.

Why it matters

The $85.7 billion raise stands as the largest IPO windfall in history, providing SpaceX with the capital required to clear legacy debt and expand its infrastructure.