A nearly $5 billion loss — Can Musk’s giant rockets feed the AI “money-guzzling beast”? This IPO, widely regarded as potentially the largest in history, now faces a severe test from massive losses.
According to The Information, citing sources familiar with the matter, SpaceX recorded revenue exceeding 18.5 billion in 2025, with a net loss of nearly 18.5 billion in 2025, with a netloss of nearly 5 billion. This previously undisclosed consolidated financial data includes the performance of xAI, which SpaceX acquired in February 2026. It should be noted, however, that since the acquisition closed in February 2026, xAI’s results should not have been included in the 2025 financials under standard accounting rules. The figures represent pro-forma combined results intended to illustrate the overall operational picture post-IPO.
Market analysts generally believe that despite significant short-term loss pressure, SpaceX’s long-term growth prospects remain highly favorable, driven by continued Starlink user expansion, Starship commercialization progress, and the upcoming listing.
As the undisputed leader in the global commercial space sector, SpaceX’s businesses span four major areas: reusable rocket manufacturing and launches, satellite internet (Starlink), space tourism, and defense communications (Starshield). The primary revenue driver is the Starlink satellite internet business. Data shows that by the end of 2025, Starlink had launched over 10,000 satellites, with approximately 9,400 in orbit, and nearly 9.2 million active global users. Industry estimates put Starlink’s 2025 revenue at about 10.6 billion, with EBITDA of 10.6 billion, with EBITDA of 5.8 billion — accounting for more than two-thirds of SpaceX’s total revenue. Musk has explicitly stated that “the vast majority of SpaceX’s revenue comes from the commercial Starlink system.”
In addition to Starlink, rocket launch services remain another core pillar. In 2025, SpaceX completed approximately 167 orbital launch missions, accounting for about 85% of all U.S. orbital launches that year and setting a new company annual record for the sixth consecutive year. The Falcon 9, the world’s first fully reusable liquid-fueled orbital rocket, has achieved a record of 32 reuses for a single booster. Although the two core businesses — rocket launches and Starlink — together generate droughly 8 billion ina djusted EBITDA, demonstrating strong profitability, the nearly 8billion in adjusted EBITDA, demonstrating strong profitability, the nearly 5 billion net loss still exceeded market expectations for SpaceX’s overall earnings.
Where Did the Losses Come From?
The core of the losses points directly to the acquired xAI. Since its founding in 2023, xAI has burned cash at a staggering pace. Internal documents show that in the first nine months of 2025, it consumed approximately 7.8–8 billion in cash, with revenue of only about 7.8–8 billion in cash,with revenue of only about 210 million. The third quarter alone saw a net loss of 1.46 billion, primarily spent on procuring high-end AI chips and building large-scale data centers. SpaceX invested nearly $13 billion in chips and data centers to support the xAI project — far exceeding the combined capital expenditure of the rocket and satellite divisions.
Additionally, xAI is undergoing core team adjustments. Recent reports indicate that Chief Financial Officer Anthony Armstrong, who joined in October last year, has departed. Michael Nicholls, Senior Vice President of SpaceX’s Starlink business, has taken on the role of xAI President and is leading a new round of engineering team restructuring. In an internal memo, he bluntly stated that xAI’s computing team’s training performance is “embarrassingly low,” and the company plans to significantly improve it within the next two months to catch up with competitors as quickly as possible.
IPO Countdown
Just as the massive loss figures surfaced, SpaceX’s IPO preparations have entered the final stretch. Reports indicate the company has confidentially filed a listing application with the U.S. Securities and Exchange Commission (SEC). It plans to release the public prospectus by the end of May, kick off the roadshow during the week of June 8, target a valuation range of 1.75trillionto1.75trillionto2 trillion, and raise approximately $75 billion.
Analysts note that to justify the $1.75 trillion valuation, investors must closely monitor Starship’s commercialization progress, the expansion of Starlink’s Direct to Cell (satellite-to-phone) service, and the synergistic effects of AI infrastructure. Gene Munster, partner at Deepwater Asset Management, believes these businesses are promising, but the true long-term profit engine lies in the unique “sovereign AI” asset portfolio that Musk has assembled — a vertically integrated stack combining rocket launches, satellite networks, and AI computing capabilities. McKinsey predicts that the sovereign AI market could reach $600 billion by 2030.
Notably, the retail investor allocation in this IPO will be “extremely large.” Sources reveal that SpaceX plans to offer shares to retail investors in the UK, EU, Australia, Canada, Japan, and South Korea, and will invite approximately 1,500 retail investors to a dedicated event on June 11. SpaceX CFO Bret Johnsen stated, “Retail investors will be a key component of this offering and are expected to represent a higher proportion than in any IPO in history.” Multiple institutions warn that the heavy retail participation may amplify emotion-driven market dynamics, leading to greater volatility in the stock price during the early trading period and potentially diverting attention from other simultaneous listings.
Overall, although the 2025 pro-forma combined results show a loss due to heavy xAI investments, SpaceX’s core space and Starlink businesses have demonstrated strong cash flow potential (with adjusted EBITDA remaining positive). Looking ahead, as Starship achieves higher payload capacity, Starlink’s user base continues to grow, and AI synergies gradually materialize, whether this “Space + AI” powerhouse can deliver on its lofty IPO valuation will remain a key focus for the market.
