Elon Musk’s SpaceX is preparing for what could become the largest initial public offering in history, potentially raising $50 billion and exceeding the total amount raised by all 90 IPOs that debuted last year.
Fortune reports that the hotly anticipated SpaceX IPO is shaping up to be a record-breaking event that would dwarf the combined capital raised through all initial public offerings from the previous year. Following its all-stock acquisition of xAI, the AI company behind the chatbot Grok, SpaceX is positioning itself for a market debut that could transform the IPO landscape.
News of Musk’s IPO plans emerged in December, coinciding with a funding round that valued the rocket enterprise at $800 billion. Shortly before being acquired by SpaceX in January, xAI achieved a valuation of $230 billion through its own capital raise. The combined entity now carries an equity valuation exceeding $1 trillion from investors.
According to reports from Bloomberg and the Financial Times, Musk is targeting an offering that would value the merged SpaceX at $1.5 trillion while raising approximately $50 billion in cash to fund expansion initiatives. Franco Granda, an analyst at PitchBook, believes a $1.75 trillion valuation could be justified based on SpaceX’s substantial growth potential, particularly within its Starlink satellite business.
If SpaceX achieves a $1.5 trillion valuation, it would rank as the second-most-valuable IPO in history, trailing only Saudi Aramco’s late 2019 introduction at over $1.7 trillion. A $50 billion capital raise would claim the top position on the all-time list when adjusted for inflation, according to data compiled by Bill Megginson, a professor at the University of Oklahoma. This would exceed the current leader, Nippon Telegraph & Telephone’s 1987 offering of $44 billion, and significantly outpace other major IPOs including Visa’s $27 billion in 2008 and SoftBank’s $28 billion in 2018.
The financial prospects for SpaceX remain highly uncertain. After 23 years of operation, the company still generates zero net earnings, according to Fortune’s analysis. To justify a $1.5 trillion market capitalization, SpaceX would need to produce earnings exceeding those of Berkshire Hathaway to deliver adequate returns for shareholders.
However, one group stands to benefit substantially from the offering regardless of the company’s long-term performance: Wall Street investment banks managing the deal. The financial rewards for underwriters come in two primary forms. First, there are underwriting fees, known as the gross spread, which banks receive for preselling shares to institutional investors. Jay Ritter of the University of Florida, a leading academic expert on IPOs, estimates these fees would amount to approximately 2 percent of the total raise, or $1 billion on a $50 billion offering.
While the $50 billion raise represents only 3 percent of SpaceX’s total market capitalization, the combined cost of underpricing and fees would exceed $10 billion. This represents a significant expense for a company with substantial capital expenditure requirements. Reports indicate xAI alone spent $8 billion on plants and equipment in 2025, and SpaceX, as a manufacturer of massive rockets, likely faces similarly high capital needs.
Ritter suggests Musk has alternatives to the traditional IPO structure that could retain more capital for the company. One option is a direct listing, which bypasses the presold underwriting procedure and allows market makers to set the opening price based on incoming orders from all interested parties. While direct listings have traditionally been used by existing shareholders to cash out, Musk could subsequently conduct a follow-on offering at a potentially higher price. Spotify, Palantir, and Coinbase all used direct listings for their public debuts.
Another possibility is limit order book building, a program used by DoorDash and Airbnb for their listings. This approach requires institutional investors to specify both the quantity of shares desired and the price they are willing to pay, rather than simply requesting an allocation. While this method would not eliminate underpricing entirely, it could substantially reduce costs for SpaceX.
Alternatively, Musk could leverage the threat of these non-traditional approaches to negotiate lower fees and obtain pricing closer to true market value from underwriters and their clients. “Musk is known as a maverick, a guy who thinks out of the box,” says Ritter. “He fits the profile of the kind of CEO that in the past has gone for this kind of tradition-breaking solution.
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Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship.
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