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And the prospectus says it plainly: "Mr. Musk will be able to control the outcome of matters requiring shareholder approval."
Musk holds over 85% voting power through Class B super-voting shares (10 votes/share). Public investors combined will have 15%.
What Musk Controls:
- CEO removal = his consent. You can't fire him even if he destroys the company
- Take business for himself. SpaceX gets a rocket deal? Musk can say "I'll do it at Tesla instead"
- 85% voting forever. No expiration, no time limit, permanent control
- Board elections. You have no power to elect directors you trust
Voting control doesn't change management's fiduciary duty to all shareholders. The founders retaining voting control has worked out fine for Alphabet shareholders.
If we were a saner society, this would not be a valid way to carry out corporate governance.
This is just sole proprietorship with window dressing.
I haven't read the prospectus but I would be interested to know, when he dies, to what degree the "... control the outcome of matters requiring shareholder approval" part will be inherited. Does that facility just go along with the Class B super-voting shares? And if it does what does it mean if more than one person inherits his shares?
On the subject of the governance structure this [1] is worth a read ...
"The company significantly limits shareholders' rights to sue. SpaceX's bylaws will make it clear that anyone who owns shares "irrevocably and unconditionally" waives all rights to pursue a jury trial. Shareholders will also be prohibited from bringing class actions against the company, its directors, officers, controlling shareholders or bankers tied to the IPO, according to the filing.
Instead, shareholders will be subject to mandatory arbitration, which had long been illegal in the U.S. The Securities and Exchange Commission reversed its position, opens new tab in September, allowing companies to adopt mandatory arbitration policies, which are private proceedings overseen by arbitrators."
... I can't remember how much he spent in Pennsylvania but you might argue it was money well spent.
[1] https://www.reuters.com/sustainability/boards-policy-regulat...
This should frankly be disqualifying for any company trying to go public. Super voting shares have their place but there's no scenario in which overall control of the company can be retained by super voting shareholders who make up a small minority of the overall shareholders.
The point of a company going public is not to just distribute possible profits among speculators, but to give the public a meaningful voice in company direction, in particular by offering escape hatches like being able to eject a CEO who's lost their mind and is no longer acting in the fiduciary best interest of the shareholders, which will so obviously happen here.
It's really not a public company at all in the sense people are accustomed to. The super voting shares plus the 3% rule for a lawsuit plus the arbitration clause make Musk almost totally unaccountable. It certainly should not be included in stock indices that are used for passive investing, because it is a different category of asset.
- Take business for himself. SpaceX gets a rocket deal? Musk can say "I'll do it at Tesla instead"
In theory (were we talking about any other man, in any other time) that's very strictly illegal with a whole area of law dedicated to it (fiduciary duty).
Truly, in the face of this, caveat emptor has never been truer.
If/when Musk’s misadventures turn his companies to shit, I may spare a thought for the collaterally damaged, but not a single tear will I shed for the shareholders.
Tons of people are already buying you don't have to sell it to them.
I'll happily take Musks proven and superior leadership with guarantees over letting the company decline chasing short term sugar hits that destroy it long term.
It is seriously baffling to me who is going to buy shares in this with 1) this structure and 2) at this valuation.
And it is a LOT of money that he is floating ($77B) so there have to be dumb people at scale for this to work.
I think this is a very big issue. If SpaceX is very successful, will he pay out dividends, or will he spend everything on a mission to mars at a massive loss or something like that?
I don't think many who plan on buying the stock it to be controlled by anyone other than Musk.
This isn't even a theoretical concern and it goes well beyond unfettered control of a single company. Look at the history:
1. One of Elon's companies (Tesla) bought out another of Elon's companies (Solar City) that was going bankrupt because it owed a lot of money to yet another of Elon's companies (SpaceX) [1];
2. Elon diverted $500M of NVidia H100 GPUs reserved for Tesla to xAI [2];
3. Elon made a buyout agreement for Twitter then tried to back out. Twitter sued (for specific performance) and a Delaware judge agreed. Elon completed the purchase before the court ordered him to [3]. That purchase was secured by his Tesla shares. He ran Twitter into the ground and then created xAI in 2023 [4]. Both Tesla and SpaceX "invested" billions into it. Elon ultimately used the funds to buy out Twitter at an inflated price (and still less than he paid) [5]. He ultimately then bailed out the xAI investors by having SpaceX acquire xAI [6]. IMHO this made SpaceX a significantly worse company. It was also used to inflate the value of SpaceX by using some wildly optimistic made up numbers about the AI total addressable market; and
4. The Cybertruck has been an unmitigated financial disaster. It's a terrible car and sales are awful. But that's OK because Elon uses SpaceX to buy Cybertrucks [7].
At least with the Google founders and Mark Zuckerberg, they only had one company so they weren't playing corporate shell games or using it as a personal slush fund on this scale.
[1]: https://www.nytimes.com/2026/04/24/technology/elon-musk-spac...
[2]: https://www.cnbc.com/2024/06/04/elon-musk-told-nvidia-to-shi...
[3]: https://www.npr.org/2022/10/06/1127346372/elon-musk-twitter-...
[4]: https://research.contrary.com/company/xai
[5]: https://www.reuters.com/markets/deals/musks-xai-buys-social-...
[6]: https://www.bbc.com/news/articles/cq6vnrye06po
[7]: https://www.businessinsider.com/spacex-bought-tesla-cybertru...
You can absolutely level this claim against Tesla too. When deliveries dropped a year ago, the stock price didn't go down. Tesla's stock is disconnected from the fundamentals and every stock investor today knows this.
Why would SpaceX be any different? If anything it would be even more disconnected from the fundamentals than Tesla is, given how much more control it gives Elon.
SpaceX stock is a bet on Elon, full stop. It has nothing to do with space, data centers, AI, or whatever technology they're currently working on; it's a bet that Elon will figure something out.
(and if you need any example of this, just look at Twitter--he engineered an exit for his X shareholders at a higher valuation [at the expense of SpaceX, but a positive exit nonetheless])
Yeah you can’t go into this with any expectations or later complaints. Everyone knows at this point that he’s going to do whatever the fuck he wants. If you give him money, that’s what it’s for.
I say this entirely neutrally. Some people want to invest in that—and he’s made a boatload of money for those who have thus far!—while others find it insane.
But you don’t get to buy into this and complain.
I 100% agree SpaceX (and Tesla) is a bet on Elon, completely divorced from the fundamentals. But I don't think people realize just how risky this is.
Tesla is only one administration change away from going bankrupt. Ask yourself what would happen to Tesla if BYD could freely import cars.
This might not even take an administration change. Elon very famously had a public falling out with Donald Trump, going so far as to call the sitting president of the United States a pedophile, basically [1]. Now, as a Tesla investor, what to make of this? Elon is technically risking the entire company on a childish outburst.
SpaceX at least has some competitive advantages. Falcon 9 as a launch system is unmatched. Nobody can currently compete with the track record and cost per launch (factoring in booster reuse). That may change but the next company has to compete with the Falcon 9 and develop a proven track record. Also, SpaceX is American so it has guaranteed business from the US government for national security reasons.
But, space operations are a rounding error in the valuation model for SpaceX. All of the AI stuff is bullshit, basically, particularly space-based data centers. STarlink is interesting but is dependent on Starship and will have to compete with 5G operators.
[1]: https://thehill.com/homenews/administration/5387380-elon-mus...
He seems pretty good at figuring stuff out.
> Even at $63 per share, we give SpaceX a lot of benefit of the doubt in two of the three scenarios, in which we assume the company can achieve a rapidly reusable Starship rocket enabling multiple launches per week and successfully commercialize data centers in space.
> In our downside scenario, orbital data centers won’t work or offer any advantage over terrestrial ones. We surmise that the company, having invested tens of billions to find this out, would cut bait on the project sometime around 2028, the way management walked away from plans to build multiple small-car factories at Tesla.
The orbital data center thing is really strange. Without some kind of massive technological breakthrough the physics of an orbital data center make no sense. Napkin math for a single data center including solar panels, radiators, compute and structure is somewhere on the order of ~6500 tonnes. Let's say Starship can put 100-150 tonnes into orbit per launch, that is somewhere between 40-65 launches for just one single orbital data center.
> In our downside scenario, orbital data centers won’t work or offer any advantage over terrestrial ones
Technologically, will they work? Shovel enough money at the problem and there's no reason they shouldn't. Rack up some GPUs in a shipping container, attach a couple of solar panels to the outside, zip-tie a Starlink to the door. Except for the little problem of heat. Space isn't cold, it's more of a giant Thermos bottle, and they gotta park in full sunlight, which is famously the only thing supplying the heat that keeps the entire planet alive. Good luck to them with their radiator setup.
But economically? There's no chance. Too expensive to get into space, too many auxiliary systems required, no maintenance is possible, and, given the lead time of prepping payloads for launch versus the rate of new developments in AI hardware, likely badly behind the times if not outright obsolete on the day of liftoff.
There is no shortage of land despite what some in the media would have you believe. Those same solar panels work at ground level. DCs don't have to be water guzzlers or grid destabilizers. They'd be better off by every metric solving terrestrial problems for the same money.
Of course they won't work. It's ludicrous that we have to even entertain the thought of otherwise.
Do they have a projection for what the company will be valued when he gets to mars by 2017?
> We Think the SpaceX IPO Is Overvalued
Well... yeah, sure, everyone thinks that.
And the fact that it doesn't matter and won't impact demand for shares illustrates how increasingly and dangerously untethered the stock market is from reality.
> ...and dangerously untethered the stock market is from reality.
"Disconnected from historical valuation norms" is a more sensible statement.
The idea that the stock market is "detached from reality" is dangerous too because the stock market is...reality. People make and lose real money in it every day.
There are good arguments that the historical valuation norms are reasonable and deviation from them is "dangerous" but there's no actual law that says the stock market needs to behave according to history.
While I personally think the current behavior has significant risk, I also can't dismiss that the role the stock market plays today is different. It's not just about raising capital, providing liquidity, price discovery, risk management and building wealth, for large numbers of laypeople it's also the go-to casino (entertainment) and a platform for expression (way to express dissatisfaction with corporations, politicians, the world, etc.).
> And the fact that it doesn't matter and won't impact demand for shares illustrates how increasingly and dangerously untethered the stock market is from reality.
Part of the reason for this demand is the fact that index tracking funds like QQQ will be forced to buy up massive volumes of shares. Not only that but other non index tracking funds that track large cap stocks will also have to buy. Vanguard large cap for example manages trillions of dollars. That in itself will have 100s of billions worth of buy orders.
A lot (everything?) hinges on orbital data centers. If they don't work, SpaceX is overvalued.
SpaceX plans to launch 120 kW satellites, each weighing 1.7 tons. Let's be conservative and say it ends up being a 100 kW satellite massing 2 tons. Let's be conservative and say Starship can launch 50 tons to orbit for $20 million ($5 million more than a Falcon 9 launch).
50 kW per ton x $400K per ton = $8,000 per kW = $8 million per megawatt in launch costs.
That means a 100 megawatt orbital data center will cost $800 million to launch.
You need about 833 satellites for 100 megawatts, so let's round up to 1,000 satellites. Let's say one of these satellites cost $3 million (that's probably high, but let's go with that for now). That's about $3 billion for satellite manufacturing.
Bottom line: It will cost SpaceX $4 billion to launch a 100 megawatt data center.
Anthropic is paying SpaceX roughly $50 million per megawatt per year. SpaceX could sell access to its data center for $5 billion per year. Assuming the satellites last for 4 years, that's $20 billion in revenue from $4 billion in costs.
Please correct my math/assumptions, but this rough calculation shows that SpaceX could be right and Morningstar could be wrong.
Why are we considering data centers in space? What problem does it solve? I don't understand this concept at all.
Surely putting server racks in orbit where you can't do basic maintenance without sending someone up there is a terrible idea?
It just always puts me in mind of the story of an IT guy having to travel for two days to go to a premises and turn on a server that three separate people ensure him was already on.
My trading app (Nordnet - big in Scandinavia) is plastered with ads for the SpaceX IPO.
I don’t think I have ever seen this before.
I need to understand what possible benefit there is to doing DCs in space. The cost would be, no pun intended, fucking astronomical. The cooling situation would make no sense at all -- the major up-and-coming application of DCs, LLM training, has absurd cooling requirements even here on earth where convective cooling is an option, to the point where many DCs use open-loop cooling. Latency might be better, in some cases, I guess, but probably not by some groundbreaking amount.
Who is this product for? How the hell did "data centres in space" make it into the prospectus at all?
More to the point, why is Morningstar being so generous with their interpretation of that line of business? It's plainly insane, and you don't need an advanced degree in physics to understand why.
If SpaceX is indeed overvalued (which I have no opinion on), it above all else demonstrates how unimportant spaceflight still is.
SpaceX has been the only game in town for quite a while now, to such an extent that the intelligence agencies of foreign governments have no alternative but to launch with SpaceX. They now do more orbital launches than the entire rest of the world combined. If they really are worth less than Microsoft, then it seems space just doesn’t matter that much, because SpaceX is space for all practical purposes.
Also see Aswath Damodaran’s updated analysis. It’s not quite as dire as Morningstar but is still lower than what musk wants.
> At the rumored pricing of $1.8 trillion for the company, it is too richly priced for my tastes, given my valuation of $1.25-$1.35 trillion for the equity in the company.
https://aswathdamodaran.blogspot.com/2026/06/a-weeks-ago-i-a...
I wish Ed Zitron (currently also front page HN) would adopt this calm, measured writing style. It’s much more convincing and shorter to read too.
80% of all mass launched from Earth in 2025 was launched by SpaceX, and 95% of those launches were with reusable systems.
That dwarfs all other launch capabilities on Earth, including all governments. Short and medium term value may be shaky if you evaluate SpaceX as a typical business.
Compute in orbit is "stupid" only to those who don't think it through. Their biggest initial customer for that feature will be Google, and through Google, Apple; two of the highest value tech companies on Earth. Seems like a fascinating flywheel to me.
No matter what a stock broker thinks, the market decides. At this moment SpaceX’s shares are oversubscribed:
https://www.bloomberg.com/news/articles/2026-06-08/spacex-ip...
You should beware of the predictive power of Morningstar before you read/take their advice.
The real question is whether or not the stock will be more overvalued, immediately after the IPO. My brother earned a bunch on the Rivian IPO, despite considering it overvalued, because he figured it likely wasn't overvalued enough.
I don't think euv capacity will ever make data centers in space a thing.
From SpaceX's S-! it bases its valuation on the total addressable market of 3 markets, which is made up of:
1. Space operations: $370 billion;
2. Connectivitiy: $1.6 trillion, roughly split between mobile and broadband; and
3. AI: $26.5 trillion, which includes $22.4T in AI Enterprise applications, $2.4T in AI infrastructure, $760B in subscriptions (ie Grok) and $600B in digital advertising.
So immediately we see the limits of the space market. SpaceX did 170 launches in 2025. At $100M each, that's $17 billion in revenue and Falcon 9 launches just don't cost that much. That brings Starship into the picture but that program is arleady at $15 billion spent without a single dollar in revenue. So we know from the outset that only the other markets can really justify the STarship prgoram because you have to remember that STarship has to compete with Falcon 9. Or, even worse for SpaceX, a Falcon 9 competitor.
Now, as for Starlink, this one is interesting. Starlink has a big advantage when you need mobile broadband (eg planes, boats) as there's nothing really equivalent, Yes, there's 5G and that's fine in populated areas on, say, RVs and such. But the receivers are expensive.
I think Starlink is going to have a hard time competing with 5G, mainly because 5G already exists and Starlink handhelds are predicated on STarship being able to launch sufficient low-altitude V3 Starlink satellites, which themselves have a more limited life because they are lower altitude. And you're still going to have to deal with per-country licensing, marketing, regulations, etc.
I wonder how much of this is predicated on military applications.
But let's get to AI as that's the most hand-wavy (IMHO) of all this.
First, digital advertising. Well, when Elon bought Twitter it had $4.5B in ad revenuie. Now it's $1.8B. I also think Twitter is fundamentally limited so that's just not going anywhere. Twitter just isn't 10x'ing it's audience (IMHO).
Subscriptions? I think this is a dead market. For everyone. Why? There'll be a race to the bottom, hardware will get cheaper, eventually AI agents will be run locally (even on phones, eventually) and it's just not the cash show OpenAI, SpaceX or Anthropic think it is.
Let's also dispense with orbital AI data centers. It's a completely dumb idea. it's going nowhere. Don't believe anyone hyping it up. It makes zero sense and it will never amount to anything.
SpaceX seems unable to monetize their AI investments thus far. How do I know this? Because you don't lease DC space and GPUs to Google if you have a better use for them. So it not only looks like you're falling behind but you also need the cash. Also, this is dependent on getting enough GPUs. Published details about the Google deal seems to allow Google to cancel or revise the deal if SpaceX is unable to deliver so there is a huge risk here.
What none of these companies (SpaceX, Anthropic, OpenAI) seem to be addressing is what happens when future generations of hardware come out? What happens when running models locally becomes more and more viable? What if there is no expensive hardware moat? What happens when AI models get commoditized? I personally believe this last one will happen and China will make sure it happens.
So all in all there are a ton of risks here. I am skeptical about the long-term prospects of OpenAI in particular and Anthropic less so but I think xAI's (ie Grok's) future is way more uncertain.
I'm actually most confident in Google's future here because they haven't bet the company's future on AI not imploding.
I'm generally going to avoid betting against Elon.
This is the most white collar “we call bullshit” type of writing I’ve seen in a long time and I’m here for it. Not a good sign for the next two AI IPOs either. SpaceX had the hubris to release their S-1 publicly and whatnot. This is going to be “Hot Garbage Summer” in the equities market lmao. GG VCs.
Maybe, but his proposed share structure is hilarious. I can't tell if Musk is serious or trolling Wall Street again. =3
IMO the purpose of going public is primarily to make it hard to nationalize SpaceX, which some people have called for.
Data centers at the bottom of the ocean make more sense than data centers in space.
No duh.
This isn't different than any other tech IPO in the last 15 years.
Everyone says SpaceX IPO price is too high, but it's the most interesting IPO in a long time, it's critical to the US government, and America is, frankly, addicted to gambling. I'm not convinced it's going anywhere but up for a long while.
For a moment then I thought this was the communist newspaper Morning Star https://morningstaronline.co.uk/
No wonder they think it's "over valued"
>However, we assign this scenario, in which both Starship is reusable and scaled orbital data centers are highly successful, a 7% chance of happening
I may agree with their overall sentiment, but I think this sort of formulation is just silly nonsense from analysts who build models instead of companies.
Not a criticism of the article, but...
...from the pages of Duh Magazine
And water is wet
I want some shares purely as a novelty. Don't really care about the price. It's not about making money. It's about owning a piece of the future.