SpaceX shares fell more than 3% in premarket trading on Tuesday, extending a brutal three-day losing streak that has wiped out most of the gains from the company’s blockbuster IPO just 11 days ago. Monday’s 16.4% plunge was the worst single-day drop since the stock began trading on the Nasdaq, and the selloff shows no signs of stabilizing.
The Numbers Tell the Story
The scale of the unwind is staggering. SpaceX (SPCX) closed Monday down 16.4% after shedding roughly $400 billion in market capitalization in a single session, CNBC reported. That followed a 5% drop on Wednesday and a 3.6% decline on Thursday before the Juneteenth holiday closed markets on Friday.
From its post-IPO peak, the stock has given back the vast majority of its gains. Shares now sit roughly 14% above the $135 IPO price, a far cry from the euphoric trading that briefly valued the company at close to $2 trillion in the days after its June 12 Nasdaq debut.
Tuesday’s premarket weakness suggests the selling pressure is not exhausted. Broader tech sentiment is also soft, with the Nasdaq slipping 0.27% on Monday even as the S&P inched higher.
Why the Bond Sale Spooked the Market
The proximate trigger for Monday’s crash was SpaceX’s disclosure of its first-ever bond offering. The company filed paperwork confirming it “intends to use the net proceeds from the Notes offering to repay the outstanding borrowings under its bridge loan facility in full.” Debt issuance this soon after an IPO is not inherently alarming, but the timing created a narrative problem.
For a company valued at nearly $2 trillion and sitting on billions in fresh IPO capital, the need to tap bond markets to repay a bridge loan raises questions about how the cash from the public offering is being allocated. Investors who bought into the IPO expecting the proceeds to fund growth, not refinance existing debt, had reason to sell.
The AI Data Center Wild Card
Buried under the selloff headlines is a deal that may ultimately matter more than the stock price volatility. SpaceX signed a multibillion-dollar computing agreement with Reflection AI, the open-source AI startup last valued at $25 billion. Under the terms, Reflection will pay SpaceX $150 million per month starting July 1, 2026, totaling roughly $6.3 billion if the deal runs through 2029.
Reflection will access Nvidia GB300 chips at SpaceX’s Colossus 2 data center in Memphis, Tennessee. This is the same facility complex where Google committed roughly $30 billion and Anthropic committed $45 billion for computing capacity in the weeks before the IPO.
The data center business is becoming a significant revenue engine for SpaceX, one that has nothing to do with rockets and everything to do with AI infrastructure demand. Combined, the Google, Anthropic, and Reflection deals represent more than $80 billion in contracted revenue through 2029. That is a fundamentally different business profile than the launch services company investors were pricing before the IPO.
What Comes Next
The question for investors is whether the selloff represents healthy price discovery after an overshoot, or the beginning of a longer correction.
Bears point to the valuation. Even after the decline, SpaceX trades at a market cap that exceeds most of the aerospace and defense sector combined. The company’s revenue, while growing rapidly across Starlink, launch services, and now data centers, does not yet justify the multiple the stock commanded at its peak.
Bulls counter that the AI data center contracts are transformational. If SpaceX can reliably convert its real estate, power access, and Nvidia allocations into $80 billion in contracted cloud revenue, the company begins to look less like a rocket manufacturer and more like a hyperscaler with a space division attached.
For now, the market is voting with the bears. Tuesday’s premarket decline suggests institutional investors are still reducing positions, and the bond offering has introduced a credit narrative that did not exist a week ago. The IPO was the biggest in history. The hangover may be proportional.