The market is gearing up for a SpaceX IPO on June 12, and it feels like yesterday that the business confidentially filed for its IPO. That was on April 1 this year. You would expect quiet action since then, but the space-AI hybrid is accelerating before the ticker goes live.
SpaceX has signed two monster compute-rental contracts that together add $26 billion in annual run-rate revenue. This happened so quickly that Epistrophy Capital Research chief market strategist Cory Johnson said: “…SpaceX is the first company to ever add $26 billion in ARR [annual run rate] between the date of its IPO filing with the SEC and the first trade.”
If SpaceX is growing so fast even before its IPO, the growth ceiling could be much higher than where it is today.
How SpaceX’s sales are ballooning
No one would have predicted even 6 months back that you would see Anthropic and Alphabet (NASDAQ:GOOG | GOOG Price Prediction) sign massive deals with SpaceX. However, the merger between SpaceX and xAI has allowed this to take place.
SpaceX has pivoted from a launch-and-satellite firm to one of the world’s largest AI infrastructure landlords. Anthropic will rent capacity in the Colossus data center at $1.25 billion a month, while Google has agreed to pay $920 million a month from October.
The contracts give SpaceX an immediate, high-margin revenue stream that dwarfs last year’s $18.7 billion in total sales.
What this also means is that IPO investors are no longer paying an absurd premium. If SpaceX has a $1.77 trillion IPO, it would trade at ~90 times $20 billion in sales. But once you add this new $26 billion into the picture, you’re looking at a price-to-sales ratio of 38x.
If you include potential future deals like this, you’re probably paying less than 30x full-year 2026 sales.
Expect short-lived euphoria instead of a marathon
SpaceX making enormous strides on the revenue side does not mean it is winning overall. Core operations showed a $4.9 billion net loss in 2025, and this was before xAI came into the picture.
The Anthropic and Google deals are coming in after SpaceX had already factored the heavy running costs and depreciation of these data centers into their Q1 operating losses. Thus, margins have improved drastically. The revenue stream fully offsets the AI segment’s operating losses, and we might even have SpaceX near break-even or into operational profitability for the second half of 2026.
Unfortunately, this does not mean you are going to see a massive “forever” annual revenue stream from Google and Anthropic. For example, Google has an incentive to pay Apple (NASDAQ:AAPL) $20 billion annually to maintain its dominance. When it comes to an AI competitor like SpaceX, it’s paying that amount as a stopgap measure to ensure it has enough compute.
Both Anthropic and Google are paying for compute.
As the data center buildout progresses, there will be less of a need for SpaceX’s data centers. Hence, I expect these contracts to scale down significantly within 5 years.
You’re probably going to see IPO hype akin to that of CoreWeave (NASDAQ:CRWV) on steroids, but it will fade even quicker.
How I would play the SpaceX IPO
I would not put everything into SpaceX’s IPO on day one. Most investors are trying to get a slice of this before major indexes start doing so. You’re then likely going to see a reversal to reality. Wall Street has not been rewarding businesses with shaky fundamentals and hollow profits.
Moreover, the market will have better things to move on to, namely Anthropic and OpenAI once they both come online.
Of course, SpaceX’s space arm is strong and profitable, but this is a shaky bet in the short to medium term when you look at it holistically. AI is simply burning too much cash.
The biggest winner of all this will be SpaceX itself. It will raise much-needed cash to succeed in the long run.
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