Roughly 95% of SpaceX stayed locked up when it went public, leaving four to five percent of the shares actually available to trade. The IPO priced at $135 on 11 June and opened the next morning at $150, which tells you most of what happened next: enormous demand, almost nothing to buy. The stock ran to $225 within days and the market cap went past $2.5 trillion. Then it did what thin markets do when the buying stops, and on 15 July it broke below its IPO price for the first time, touching $132.28.

None of that fall required a single new share. The 95% is still locked. What changed is that everyone willing to pay a scarcity price had already bought, and once scarcity stopped setting the number, the fundamentals did. Daniela Hathorn at Capital.com called the retreat profit-taking, valuation reassessment and "the unwinding of extremely bullish positioning", which is the polite version of saying the shortage wore off.

The fundamentals are not comfortable. The public got about 5% of the company at 94 times sales. Aswath Damodaran read the $28.5 trillion addressable market claimed in the prospectus, called it a hallucination he'd be embarrassed to publish, and said the document looked like it "was written by Grok". His own discounted cash flow work put the IPO valuation 27% too high. S&P expects negative free cash flow through 2029, and Morgan Stanley, which is bullish, doesn't see the company cash-flow positive until 2035.

Revenue was $18.7 billion in 2025, up 33%, against a loss of $4.9 billion. Starlink is the profitable piece, growing the way a utility grows: subscribers doubled to 10.3 million while monthly revenue per user fell from $99 in 2024 to $66 by the first quarter of 2026. That's mass-market expansion, not decay. It does mean the one division that makes money makes less per head just as the AI side needs $7.7 billion of capital expenditure in a single quarter. February's merger with xAI bolted a business burning cash at the rate the private AI market has normalised onto a business that flies rockets, and the people who bought the rockets are now funding the chatbot.

Nasdaq-100 inclusion on 7 July should have been a floor. It forced passive funds to buy. The shares are down about 13% since. Mechanical demand showed up, met the same thin float, and the price fell anyway.

Which is why the lock-up schedule matters more than the price targets do. The decline so far has happened with no new supply at all. The unwind comes in tranches rather than one cliff: roughly 20% of the standard block becomes sellable a couple of days after the first quarterly results, more through autumn, and the full 180-day block expires on 9 December. Musk's own shares stay locked until June 2027. Each of those dates feeds supply into a market whose float is currently a rounding error, and into demand that has already demonstrated it won't chase. The analysts still carrying a $225 median target are betting the buyers arrive faster than the shares do. I don't think they will. Sideways or lower into December is the realistic path, with Starship the only thing likely to interrupt it.

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