SpaceX Shares Drop Below IPO Price After Starship Failure

Shares of Space Exploration Technologies Corp. tumbled on July 17, 2026, falling as much as 6.9% to a low of $122.12. This decline placed the company below its $135 initial public offering price and approximately 40% below its all-time intraday peak of $225.64. The slump follows the decision to abort a Starship V3 rocket launch due to engine ignition failures, an update Elon Musk announced on X.

The market value loss exceeds $1 trillion since June 16, when the company reached a peak valuation of $2.64 trillion. This volatility has significantly impacted the net worth of CEO Elon Musk, which Forbes reports dropped to $797 billion from a previous peak of $1.4 trillion. Contributing factors to the decline include high valuation multiples relative to revenue, the massive capital requirements for Starlink and xAI, and new competition from China's successful reusable rocket water landing.

While the stock eventually returned to the $135 IPO price, analyst concerns persist. NYU professor Aswath Damodaran estimated the company's equity at $1.3 trillion, suggesting a share price closer to $100 due to the risks associated with the xAI segment. Further volatility is expected around August 6, when the lockup period for employees and early investors ends following the second-quarter results report, potentially adding 1.37 billion shares to the market.