On the evening of June 18, SpaceX's Starship Serial No. 36 exploded during its 10th static fire test, producing a massive fireball. No casualties were reported. The accident, the most severe ground incident in SpaceX's recent history, destroyed test facilities and was described by Western media as a "catastrophic failure." The fallout quickly reached equity markets. SPCX has fallen for three consecutive trading days since June 18. On June 22 alone, it plunged 16.43%, wiping out approximately $400 billion in market cap — the second-largest single-day value loss in global corporate history.
Bond Issuance Triggers Short-Selling Logic
The direct catalyst for the 16% drop on June 22 was SpaceX's announcement of its first senior unsecured bond offering. Although the 8-K filing did not disclose the specific size, Bloomberg reported that SpaceX plans a bond issuance of at least $20 billion. Proceeds will be used to repay bridge loans from the February acquisition of xAI, pay related fees, and for general corporate purposes. Conducting bond financing less than two weeks after its IPO sent a negative signal to investors: not only does it add interest expense, but it also indicates that SpaceX's free cash flow remains elusive, and Starship's cash burn rate plus AI infrastructure capex have far exceeded market expectations.
CFRA Research, which had previously rated SpaceX a "sell," questioned the necessity of the massive financing, commenting, "With Elon Musk, you never know what he's thinking." Prominent tech hedge fund manager Dan Niles posted on X that the bond issuance and the compute agreement with Reflection AI "may remind investors that there is another hyperscale AI competitor requiring massive financing," reiterating his valuation concerns.
Global AI Stock Correction Weighs
SPCX's weakness also reflects a broader correction in AI-related stocks globally. On June 23, U.S. AI stocks fell broadly; South Korea's KOSPI dropped over 9%, triggering a circuit breaker during the session. SK Hynix and Samsung Electronics each fell more than 12%. In Hong Kong, MINIMAX declined 15% and Zhipu fell over 9%. Mainland A-share indices also opened lower. Investor concerns center on the excessive scale of AI infrastructure spending versus the prolonged commercial return cycle, and SpaceX is seen as a representative name in this narrative.
Financial media outlet zerohedge posted on X on June 22 that the divergence between hyperscale cloud vendors and semiconductors is widening, with massive capex becoming a key issue. Since its listing, SPCX has been popular with retail investors due to a float of less than 5%. According to Vanda Track, retail investors net purchased $405 million of SPCX in its first five trading days, exceeding their combined net buying of the "Magnificent Seven" stocks (NVDA, MSFT, AMZN, META, GOOGL, GOOG) during the same period, which totalled $278 million. However, retail buying alone cannot sustain the stock price, and momentum is likely to dissipate as sentiment cools.
Options and Lockup Expiration Pressures
Options trading on SPCX began on June 16, initially dominated by bullish sentiment. However, according to OptionCharts, the current put/call ratio stands at 1.07, indicating a neutral-to-bearish tilt. More critically, with only about 5% of shares outstanding, the first lockup expiration after Q2 earnings in mid-August will release 20% of shares. An additional 10% may be unlocked if the stock trades 30% above the IPO price for 5 out of 10 consecutive trading days. 22V Research strategist Jeff Jacobson estimates that insiders could sell 44% of SpaceX shares by early September, increasing the current float by approximately 900%.
A potential positive catalyst is SpaceX's expected inclusion in the Nasdaq 100 index in July, but after three consecutive days of decline, market fear has outweighed anticipation of that event.
Divergent Views: Bulls vs. Bears
On June 18, after SpaceX announced the acquisition of Cursor for $60 billion in equity, Morningstar not only refrained from raising its AI business expectations but also lowered its fair value estimate from $63 to $62, arguing that the current stock price is purely narrative-driven. Future Fund co-founder Gary Black noted that before options trading began, SPCX was trading "more like a meme stock than a fundamentals-driven company," and called the crash "an inevitable correction after short-selling tools were introduced." On June 22, KeyBanc Capital Markets issued a neutral rating on SPCX. While not setting a price target, its analysts said the current valuation already reflects future growth and the stock could be halved.
On the bullish side, Cathie Wood's ARK Invest remains one of the most committed supporters. On June 22 — the day of the sharp drop — ARK bought approximately 210,000 shares of SPCX (worth about $38.9 million) through its ETFs (ARKK, ARKQ, etc.). In 2024, ARK's model estimated SpaceX's enterprise value in 2030 at $2.5 trillion, reaching nearly $3.1 trillion in an optimistic scenario — at a time when SpaceX was an unlisted company valued at $180–350 billion. Now that SpaceX is public, ARK's continued accumulation reflects its long-term confidence in disruptive innovations such as reusable rockets, Starlink, and the space economy.
SPCX has fallen below its $150 IPO price in pre-market trading. If it closes below that level when U.S. markets open on June 23, every investor who bought and held SPCX on the secondary market will be underwater. Yet amid the selloff, the divergence between panic sellers and contrarian buyers shows that the SpaceX story is far from over.