The first major lockup expiry for SpaceX was supposed to be a major test for the stock. Instead, it turned into something quite different.
Shares have jumped 35% in just five trading sessions since the Aug. 6 lockup expiry, adding roughly $500 billion to SpaceX’s market value and pushing the stock back above its $135 IPO price.
That is a striking reversal for a company whose shares had lost more than $1 trillion in market value between their early post-IPO highs and the start of August.
For investors, the bigger takeaway is not simply that SpaceX rallied. It is that the market absorbed the first and largest wave of newly unlocked shares without the sharp selling pressure many had feared.
But the lockup story is far from over.
The first big unlock was supposed to hurt
When SpaceX went public in June, investors knew that a huge amount of stock would eventually become eligible for sale.
The first major deadline arrived on Aug. 6, when 911.5 million shares became available. That was more stock than SpaceX had sold in its IPO, making the event unusually important.
Normally, a lockup expiry can create a straightforward problem.
Early investors, employees and other shareholders who have been unable to sell suddenly gain the ability to do so. If enough of them decide to take profits at the same time, the additional supply can weigh on the stock.
With SpaceX, the concern was even greater because of the company’s enormous valuation and the sheer number of shares involved.
Yet the feared flood of selling did not send the stock into a sustained decline.
Instead, SpaceX shares rallied sharply.
The market had spent weeks pricing in the risk. Once the event arrived and the stock did not collapse, some of that fear quickly disappeared.
SpaceX has already delivered a dramatic turnaround
The rally is particularly notable because SpaceX entered the lockup expiry in a vulnerable position.
The shares had fallen more than $1 trillion in market value from their post-IPO highs by early August. On the day before the lockup expired, the stock plunged another 14%.
At first glance, that looked like investors positioning for a major supply shock.
But the bigger driver appeared to be SpaceX’s first earnings report rather than the lockup itself.
The company reported stronger-than-expected revenue and a better-than-expected loss per share. At the same time, investors were confronted with the scale of SpaceX’s planned spending on artificial intelligence.
That combination created a complicated picture.
The company was showing strong growth, but it was also preparing to spend heavily to build out its AI ambitions.
Once investors saw that the stock was not going into free fall after the lockup expiry, attention shifted back toward the underlying business and Musk’s long-term vision.
That helped fuel the rebound.
Why the selling never overwhelmed the buyers
One of the most interesting parts of the SpaceX story is the behavior of its shareholder base.
SpaceX is not simply another newly listed technology company.
Its investor base includes people who have made a long-term bet on Elon Musk and his vision for the company, rather than simply on near-term earnings or free cash flow.
That can matter enormously during a lockup expiry.
If shareholders believe the long-term opportunity is much larger than today’s valuation, they may have little reason to rush for the exit simply because they are finally allowed to sell.
There is also another important factor.
SpaceX entered the lockup expiry below its IPO price.
That may have reduced the incentive for some early investors to sell aggressively. Instead of seeing the unlock as an obvious opportunity to cash out at elevated prices, investors were looking at a stock that had already endured a major correction.
That helped create an unusual setup.
The stock fell ahead of the unlock as investors prepared for the worst. Once the feared selling pressure failed to materialize, buyers returned.
The next test arrives on Aug. 20
Investors should not assume that the first lockup expiry means the risk has disappeared.
SpaceX’s lockup structure is spread across nine stages, rather than following the more typical 180-day restriction associated with many IPOs.
The next major expiration is scheduled for Aug. 20.
As many as 319 million shares, representing about 7% of the total stock subject to selling restrictions, could become available at that point.
Similar 7% blocks are expected to unlock over the following months.
The biggest remaining event comes much later. Musk’s 6.4 billion shares are scheduled to become unlocked in June 2027.
That means investors will have to keep watching the supply picture well beyond the first successful test.
One lockup expiry going smoothly does not guarantee that every future expiry will produce the same result.
The bigger question is whether buyers keep showing up
The key issue for SpaceX is not simply how many shares become available.
It is whether there are enough buyers willing to absorb them.
If insiders and early investors sell while demand remains strong, the additional supply may have a manageable impact on the stock.
But if selling accelerates at the same time that enthusiasm around SpaceX weakens, the stock could face much greater pressure.
That is why future lockup dates could still bring significant volatility.
Investors are effectively watching two forces at the same time:
- Supply: More previously restricted shares are becoming eligible for sale.
- Demand: New investors need to keep stepping in to absorb that supply.
- Expectations: SpaceX’s valuation depends heavily on its long-term growth story.
- Execution: The company still needs to turn its ambitious plans into sustained financial results.
- Capital spending: Its AI push requires significant investment, which could weigh on near-term cash flow.
- Musk factor: Investor enthusiasm around Musk’s vision remains a major part of the SpaceX story.
The balance between these factors will likely determine how the stock behaves around each upcoming unlock.
Musk is betting on a much bigger SpaceX
The long-term story is what makes SpaceX particularly difficult to value.
On its earnings call, Musk said he expects SpaceX to reach an annual revenue run rate above $100 billion by the end of 2026.
He has also projected that the company could reach $1 trillion in annual revenue by 2029 or 2030.
Those are enormous targets.
They also explain why investors can look at the same company and reach very different conclusions.
For the bulls, SpaceX represents a combination of space launches, satellite connectivity, artificial intelligence and other businesses with potentially enormous markets.
For the bears, the concern is the amount of capital required to pursue those opportunities and the distance between today’s spending and future cash generation.
That divide is likely to keep the stock moving sharply.
SpaceX could remain a stock of extremes
The first lockup expiry has given SpaceX investors something they badly needed: evidence that a huge release of shares does not automatically translate into a collapse.
But it has not removed the fundamental risks.
The company is still facing multiple future unlocks. Its AI investments are demanding significant capital. Its valuation is tied heavily to expectations about businesses that may take years to reach their full potential.
That creates an unusual combination.
SpaceX can deliver strong operating results and still experience violent swings in its stock price.
Investor sentiment could shift quickly between excitement about Musk’s ambitions and concerns about spending, valuation and future cash flows.
That is exactly what makes the next few lockup expiries worth watching.
What investors should watch next
The Aug. 20 unlock is the immediate event on the calendar, but there are several broader signals that could matter just as much.
1. How much unlocked stock actually gets sold
Shares becoming eligible for sale does not mean shareholders will immediately sell them. The actual selling activity will be more important than the headline number of unlocked shares.
2. SpaceX’s AI spending
The company’s AI ambitions are becoming an increasingly important part of the investment story. Investors will want to see whether the spending translates into meaningful long-term growth.
3. Revenue growth
Musk’s ambitious revenue targets set a very high bar. Continued strong revenue performance could help justify the bullish narrative.
4. Investor appetite
Perhaps the most important question is whether new buyers continue to view pullbacks as opportunities.
If demand remains strong, future unlocks may be absorbed relatively easily. If sentiment changes, the same supply could have a much larger effect.
5. The valuation
SpaceX has already shown how quickly its market value can move. Investors will need to keep separating the company’s enormous potential from what is already reflected in the share price.
The bottom line
SpaceX has passed its first major lockup expiry test with a result few investors would have expected.
Instead of being overwhelmed by newly available shares, the stock has risen 35% in five sessions and added roughly $500 billion in market value.
That does not mean the road ahead will be smooth.
More shares are coming out of lockup, another sizeable batch is due on Aug. 20, and Musk’s biggest share release is still months away. At the same time, investors are weighing aggressive AI spending against strong revenue growth and an ambitious long-term vision.
For now, though, the market has delivered a clear message:
Investors were prepared for a supply shock. When it failed to arrive, they went back to buying the SpaceX story.
The next question is whether that confidence can survive the next wave of unlocked shares.