SpaceX filed its S-1 on May 20 and set up what is poised to be the biggest stock-market debut in history—a Nasdaq listing under the ticker “SPCX” targeting a valuation as high as $2 trillion and a raise of up to $75 billion. That would clear the previous record, Saudi Aramco’s roughly $29 billion offering, by more than two times. Then investors opened the prospectus and found another number: a $4.28 billion net loss in the first quarter of 2026 alone.
Both numbers are real. Both come from the same filing. The gap between them is the entire SPCX debate, and it traces back to one decision: the all-stock acquisition of xAI that closed in February 2026.
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A Profitable Company That Chose to Lose Money
Strip out the AI business, and SpaceX looks healthy. The company generated $18.7 billion in consolidated revenue in 2025, up 33% from $14.1 billion in 2024, with $6.6 billion in adjusted EBITDA. In 2024, before the xAI merger was folded into the financials, SpaceX posted net income of $791 million.
After the merger, the picture flips. SpaceX recast its 2025 results to reflect xAI and reported a $4.94 billion net loss for the full year. The AI segment alone ran an operating loss of about $6.36 billion in 2025—the vast majority of the company’s red ink. The cumulative deficit climbed to $41.3 billion, and long-term debt reached roughly $29 billion.
This was not an accident of a bad quarter. It was a strategic choice. SpaceX is deliberately routing the cash from its profitable businesses into an AI buildout—Colossus data centers, Grok training, and GPU capacity—that loses billions today on the bet that it pays off later. Q1 2026 capital expenditures hit $7.7 billion, with roughly three-quarters aimed at AI, implying an annualized burn rate north of $30 billion.
Starlink Is the Engine Funding the Whole Thing
The reason SpaceX can absorb that burn is Starlink. The Connectivity segment booked $11.39 billion in revenue in 2025—about 61% of the company’s total—with $4.42 billion in operating profit and a 39% operating margin. Subscribers more than doubled year-over-year (YoY) to 10.3 million across 164 countries. It is the only segment that consistently earns money on a GAAP basis.
