SpaceX short sellers gain $5B as stock falls below IPO price

SpaceX shares dropped below their IPO price, handing short sellers an estimated $5 billion in paper profits as enthusiasm following the company's record-breaking public debut fades.

Stock slips below IPO price

SpaceX shares briefly fell below their $135 offering price for the first time on Wednesday and continued to decline on Thursday. The stock opened around $127 on Friday after the company cancelled a planned Starship test.

The pullback follows a strong post-IPO rally that briefly pushed SpaceX's market value above Amazon, making it the world's fifth-most valuable company. Since then, the company has reportedly lost about $1 trillion in market value from its peak despite upbeat analyst price targets.

Short sellers increase bets

According to S3 Partners, investors betting against SpaceX have accumulated about $5 billion in unrealised gains as the stock declined.

The financial data firm estimates that around 192 million SpaceX shares—roughly 30% of the public float—have been sold short. It also said the notional value of short interest has climbed to $25 billion from $4.5 billion in mid-June, indicating bearish investors are increasing their positions.

S3 and Ortex analysts said short sellers have experienced significant volatility since the June IPO, but the recent decline has left them firmly in profit.