SpaceX Stock Jumps 6% on $100 Billion Unlock Day as Earlier Selloff Absorbs Supply Shock

Key Takeaways

• Up to 911.5 million SpaceX shares became eligible for sale on August 6, representing roughly $100 billion of potential supply based on recent prices.
• SpaceX shares reversed an early decline and closed 6.14% higher at $114.92, with trading volume reaching 254.6 million shares.
• The stock had already plunged 13.61% on Wednesday as investors reacted to heavy capital spending and positioned for the approaching unlock.
• With short interest equal to 34% of the pre-unlock float in late July, lower-than-feared insider selling could force bearish investors to cover positions.

SpaceX shares rallied on the day of the company’s first major post-IPO lockup expiration, defying predictions that a surge in tradable stock would trigger another sharp selloff.

On Thursday, August 6, up to 911.5 million shares held by employees and early investors became eligible for sale. The tranche was worth approximately $99 billion based on Wednesday’s closing price, making it one of the largest insider-share releases in recent market history.

Instead of collapsing under the additional supply, SpaceX stock recovered from an intraday low of $105.11 and closed at $114.92, gaining 6.14%. Trading volume climbed to 254.6 million shares, the highest since June 18, according to the company’s stock information page.

The shares opened at $107.08, below Wednesday’s $108.27 close, before reversing decisively. The price action indicated that the feared supply imbalance had largely been anticipated—or that fewer eligible shareholders were immediately selling than bearish investors expected.

Wednesday’s Plunge Priced In the Unlock Risk

The absence of a second collapse becomes easier to explain when viewed alongside Wednesday’s trading.

SpaceX shares fell 13.61% on August 5, losing $17.06 to close at $108.27. More than 202 million shares changed hands as investors reacted to the company’s first quarterly report as a publicly traded company and prepared for the lockup expiration one day later.

Although SpaceX reported second-quarter revenue of approximately $7.8 billion, up more than 90% from a year earlier and above analysts’ forecasts, attention quickly shifted to spending. Total capital expenditure reached about $18.4 billion, including roughly $15.8 billion allocated to AI computing infrastructure.

The scale of that investment raised concerns about cash consumption and the time required for the company’s AI projects to produce sustainable returns. Management also indicated that capital spending during the third and fourth quarters could remain close to the second-quarter level.

The imminent unlock added a technical reason to reduce exposure. By Wednesday’s close, investors preparing for insider selling had already pushed the stock nearly 20% below its $135 IPO price.

Thursday’s rebound therefore suggests that much of the marginal selling occurred before the shares formally became eligible for sale. Lockup expiration does not require insiders to sell, and employees or early investors may be reluctant to exit below the IPO price if they remain confident in the company’s long-term prospects.

Retail Investors Bought the Post-Earnings Drop

Wednesday’s decline did not reflect universal pessimism.

Individual investors purchased a net $22.7 million of SpaceX shares during the first hour of Wednesday trading, according to Vanda Research. That was more than three times the stock’s average first-hour retail inflow and ranked as the third-largest opening-hour total during its first 37 public trading sessions.

Retail traders appear to be interpreting SpaceX’s aggressive investment differently from some institutional investors. While institutions remain concerned about near-term losses, dilution and capital requirements, individual buyers are treating AI infrastructure, Starlink and Starship spending as investments that could strengthen the company’s long-term competitive position.

ARK Invest also bought approximately $19.7 million of SpaceX shares during the weakness, adding another source of demand before the unlock.

Wall Street analysts largely maintained constructive views following the earnings report. JPMorgan raised its price target from $225 to $240, Goldman Sachs reiterated a $220 target, and Morgan Stanley maintained its bullish $300 objective. Morgan Stanley analyst Adam Jonas described the unlock-related weakness as an opportunity to acquire the stock at a discount.

Short Positioning Raises the Risk of a Squeeze

Heavy bearish positioning may also have contributed to Thursday’s advance.

S3 Partners estimated that SpaceX short interest had risen from 23.3 million shares on June 16 to 219.3 million shares by July 29. That represented approximately 34% of the company’s 640 million-share pre-unlock float and a short position worth about $24.6 billion. Borrow utilization had reached 95%.

Some of those positions may be based on concerns about SpaceX’s valuation and spending. Others, however, were likely structured around the expectation that employees and venture investors would sell aggressively once restrictions expired.

Thursday’s rally challenged that trade. If actual insider sales remain below expectations, short sellers may need to repurchase shares to protect profits or limit losses. Such covering can create additional demand, particularly in a stock with a historically limited public float.

The 911.5 million eligible shares were about 143% of the approximately 639 million shares initially available for public trading. However, eligibility does not translate automatically into additional float because shares only enter active circulation when their owners decide to sell.

The Unlock Process Is Far From Over

Thursday marked the beginning, not the end, of SpaceX’s supply transition.

Unlike a traditional IPO lockup that releases most insider holdings after 180 days, SpaceX uses a staggered structure combining earnings-linked and time-based releases. Additional shares are expected to become eligible during the coming months, including a larger December tranche.

The biggest potential event is scheduled for June 14, 2027, when approximately 6.4 billion shares held by Elon Musk are due to leave their extended lockup. S3 estimates that this release, combined with another scheduled tranche, could eventually lift the accessible float to roughly 99% of outstanding shares.

Thursday’s performance shows that an unlock does not automatically produce a selloff. It does not, however, eliminate the longer-term supply question.

SpaceX remains below its $135 IPO price and almost 50% beneath its post-listing peak of $225.64. Its next sustained move will depend on whether new investors can absorb future insider sales and whether the company can demonstrate that its enormous AI expenditures are generating attractive cash returns.