SpaceX’s AI Spending Has Rattled Investors. Its Stock Is Sinking.

SpaceX stocks are sinking on Wednesday as investors continue to pull money from the company following an earnings report where its spending in AI rattled investors.

Shares were falling more than 7% at 10:35 a.m. and hovering below $116, almost $20 less than its IPO price and $100 from its peak.

The aerospace giant reported $7.8 billion in revenue for the quarter, beating analysts' consensus estimate of approximately $6.8 billion. Adjusted EBITDA reached $3.5 billion, well above the roughly $2.1 billion analysts had projected. Shares rose in after-hours trading following the release.

Despite the earnings beat, investors focused on several metrics beyond headline revenue. Starlink, the company's satellite broadband business, remains SpaceX's largest commercial growth engine and primary cash generator.

According to Business Insider, while the segment continued to expand, subscriber additions reportedly came in below some analysts' expectations, reinforcing concerns that growth may moderate as competition in satellite internet intensifies.

SpaceX also continues to spend aggressively on artificial intelligence infrastructure and next-generation spacecraft development. The company is investing billions of dollars to expand AI computing capacity while simultaneously funding Starship, the fully reusable launch system designed for missions to the Moon and Mars, and adding thousands of satellites to its Starlink constellation.

The company also continues to dominate the global commercial launch market through its Falcon 9 rocket program while expanding Starlink into one of the world's largest satellite internet providers. The satellite network now serves millions of customers across more than 100 countries and has become a significant contributor to recurring revenue.

Those investments are expected to keep capital expenditures elevated even as revenue continues climbing. Many investors have accepted thinner near-term margins in exchange for the company's long-term growth potential, but Wall Street remains closely focused on whether those massive investments will eventually generate meaningful returns.

Another issue weighing on investor sentiment is an upcoming lockup expiration. Approximately one billion previously restricted shares are expected to become eligible for sale in the coming weeks, potentially increasing the stock's public float substantially, which could create additional selling pressure regardless of the company's underlying financial performance. The first one will take place on Thursday, August 6.

Then, roughly 911.5 million shares valued at more than $100 billion will become eligible for sale as restrictions on early investors expire. Bloomberg noted that billions of additional shares are scheduled to be unlocked later this year, creating the possibility of increased selling pressure and greater stock volatility.