Written by: Bao Yilong
Source: Wall Street News
SpaceX has officially submitted its prospectus to the SEC, marking what could be the largest IPO in history, potentially making founder Musk the first individual to surpass a net worth of $1 trillion.
The May 20 prospectus shows that SpaceX's total revenue for 2025 is projected to hit $18.7 billion, a 33% year-over-year increase, but with a net loss of $4.9 billion. For Q1 2026, projected revenue is around $4.7 billion with a net loss of $4.3 billion.
The prospectus hasn't disclosed the planned fundraising size; details like pricing range will be included in subsequent documents.
The funds raised in the IPO will primarily be used to repay $20 billion in transitional bridge loans and expand AI computing infrastructure, upgrade launch platforms, and scale up satellite constellations.
Wall Street Insights mentioned that the core focus of this listing is on SpaceX's space launches, Starlink satellite broadband, and the integrated AI business after acquiring xAI.
The prospectus shows that the connectivity business has achieved scalable profitability, but the AI sector is still in a phase of massive loss-making investment, with capital expenditures far exceeding the combined total of the other two sectors.
Meanwhile, Musk will hold about 85.1% of the voting rights after the IPO. According to Bloomberg data, Musk's net worth is currently about $667 billion. If SpaceX ultimately lists with a valuation of $2 trillion, along with his Tesla shares, his personal wealth is expected to exceed the $1 trillion mark for the first time.
Starlink underpins the revenue base, while AI investments drag down profits.
SpaceX divides its business into three segments: space, connectivity, and AI, with distinct financial performances.
The connectivity segment, centered around Starlink satellite internet services, is currently the company's only profitable business.
In Q1 this year, Starlink achieved revenue of $3.26 billion, accounting for 69% of the company's total revenue, with an operating profit of $1.19 billion.
As of the prospectus disclosure, Starlink's global user count has reached 10.3 million, doubling from 5 million a year ago. However, the company also pointed out that with an increase in user share outside North America and the promotion of low-cost packages, average revenue per user is declining.
The space segment reported an operational loss of $619 million in Q1. The prospectus shows that SpaceX has invested over $15 billion in the Starship heavy rocket, with around $3 billion invested just in 2025. The 12th test flight of Starship is expected to take place this week.
The AI sector reported an operational loss of $2.5 billion in Q1, becoming the biggest drag on the company's overall profitability. In Q1 this year, AI-related capital expenditures reached $7.7 billion, accounting for over 75% of the company's total capital expenditures of $10.1 billion. For the full year of 2025, AI capital expenditures are expected to be around $12.7 billion, nearly doubling year-on-year.
Ground data centers remain the main battlefield, while space computing is still a blueprint.
When Musk merged xAI into SpaceX in February, he cited the solar-powered orbital data center as one of the core logics, stating that the cost of running computing power in space would be lower than on the ground within three years.
However, the prospectus reveals that xAI is currently still in a massive expansion phase powered by natural gas turbines, which includes a transaction worth about $2 billion.
The prospectus clearly states that SpaceX's ability to expand its data center infrastructure depends on turbine supply, natural gas access, and regulatory permits.
However, SpaceX still positions orbital AI computing satellites in the prospectus as the next major growth engine, with plans to start deployment as early as 2028.
The company stated in the prospectus: orbital AI computation is a highly challenging technological issue, and we believe we are the only ones with a commercially viable path to build orbital AI computing capabilities at scale.
The prospectus shows that achieving this goal relies on the Starship rocket meeting its intended performance targets for economically viable on-orbit deployment.
SpaceX has applied to the US Federal Communications Commission for permission to launch up to 1 million satellites, which will be equipped with GPUs and powered by solar energy, forming a network of space data centers for AI projects.
The company expects the potential market size to reach $285 trillion, with AI opportunities accounting for approximately $265 trillion, covering various directions such as space data centers, consumer subscriptions, digital advertising, and enterprise applications.
xAI is reshaping the AI landscape, with Grok facing regulatory risks.
SpaceX completed its merger with Musk's AI startup xAI in February this year, with a post-merger valuation of $1.25 trillion.
The prospectus notes in the risk factors section that Grok is facing multiple regulatory agencies and law enforcement departments regarding 'investigations and inquiries' into deepfake content for pornography, which could lead to legal liabilities, negative public opinion, or other sanctions.
Reports indicate that eight law enforcement and regulatory agencies have confirmed that investigations are ongoing. Musk himself also acknowledged that xAI's technology 'was not built correctly from the start' and needs to be 'rebuilt from the ground up.'
In terms of AI commercialization, SpaceX signed a $40 billion computing cooperation agreement with Anthropic this month, where the latter will rent all computing power from SpaceX's Colossus 1 data center in Memphis, Tennessee, at a price of $1.25 billion per month, with the agreement lasting until May 2029.
However, the agreement carries an unusual clause. Both parties can unilaterally cancel the contract with 90 days' notice, which is quite rare for such a scale of computing agreements, making it difficult for investors to factor it into a stable income source in valuation models.
Additionally, SpaceX plans to acquire the code editing tool startup Cursor for $60 billion in stock, with the transaction expected to proceed post-IPO. If the acquisition fails, Cursor will receive a $1.5 billion termination fee and $8.5 billion in deferred service fees.
The scale of related party transactions is huge, with Musk's empire supporting each other internally.
The prospectus for the first time disclosed specific figures on the scale of related party transactions between SpaceX and Musk's other companies.
In 2025, SpaceX purchased $131 million worth of Cybertrucks from Tesla at suggested retail prices, along with $506 million worth of Tesla Megapack energy storage products.
From early 2024 to February 2026, xAI has cumulatively paid Tesla about $731 million.
Collaboration between companies extends beyond procurement. SpaceX and Tesla are jointly advancing a large-scale chip factory project called 'Terafab' and an AI collaboration project named 'Macrohard.'
Tesla is mentioned 87 times in the prospectus, which also states, 'plans to explore more strategic collaborations with Tesla in the future.'
Musk firmly controls the voting rights, with compensation tied to Mars colonization.
The prospectus fully reveals SpaceX's equity structure and governance for the first time.
Musk holds 849.5 million Class A shares and 5.57 billion Class B shares (10 votes per share), collectively controlling 85% of the voting rights, ensuring absolute control over the company post-IPO.
Aside from Musk, no individual or institution holds more than 5%, with private equity firm Valor Entities holding 7.3% of common shares, making them the second-largest shareholder.
Musk's latest compensation plan at SpaceX consists of two astronomical options tied to the infrastructure for Mars and AI, with no expiration date.
The unlock condition for the Mars colonization plan is for SpaceX's market cap to reach $7.5 trillion.
The unlock condition for the orbital data center plan is for the company's market cap to reach $6.6 trillion.
Aside from a basic annual salary of $54,000, Musk will receive nothing if the aforementioned technical and market cap milestones are not met.
The company's board members were also publicly disclosed for the first time. Aside from Musk serving as chairman, President and COO Gwynne Shotwell, CFO Bret Johnsen, and several venture capitalists and private equity executives are also on the board, including Google executive Donald Harrison.
Financial losses are severe, testing investors' valuation logic.
SpaceX's financial status stands out among the super high market cap tech companies planning to go public.
In 2025, the company expects to achieve revenue of approximately $18.7 billion, but a net loss of up to $4.9 billion. In contrast, Meta, with a similar valuation, had revenue over 11 times that of SpaceX last year, with a net profit of $60 billion.
If the IPO valuation ultimately lands above $1.5 trillion, SpaceX's price-to-sales ratio will reach about 80 times, while the overall price-to-sales ratio of the top 15 US companies by market cap is only about 7 times.
This pricing logic is quite similar to that of Tesla, another Musk-owned company, which, due to large-scale investments in AI, humanoid robots, and Robotaxi, has extremely thin profits in 2025, yet still trades at a rolling P/E ratio close to 400 times.
Analysts believe that investors betting on SpaceX or Tesla are essentially trusting Musk to convert the current massive investments into enormous value in the distant future.