SpaceX climbed for a fourth day in a row with a market value that reached about $2.64 trillion on Tuesday, getting close to the $3 trillion mark. During trading, SpaceX briefly moved ahead of Amazon and Microsoft in market value, but by the end of the day both companies were again worth more than SpaceX.
Even after falling back, SpaceX remained among the world’s most valuable companies, ahead of companies like Broadcom, Meta, Tesla, Micron Technology and Eli Lilly.
Why investors are paying attention
The biggest question for investors is that SpaceX has reached a huge valuation even though it is not yet making profits. SpaceX is still reporting losses while trading at valuations similar to the biggest tech giants.
SpaceX generated around $19 billion in sales over the last 12 months, according to AlphaSpace data cited by Yahoo Finance. This means the company is not just a concept or a startup with no revenue. It already has major businesses including rocket launches and the Starlink satellite internet network.
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SpaceX revenue vs big tech
Microsoft generated more than $300 billion in revenue over the past year. Amazon generated more than $700 billion in revenue over the same period. SpaceX’s revenue is only a small fraction of those numbers. The company also posted a net loss of about $8.7 billion, as noted by Yahoo Finance.
Investors are no longer valuing SpaceX only as a rocket company. They see it as a future infrastructure giant that could power communications, satellite services, defense systems, launches, data networks and global internet access through Starlink. Many investors believe these businesses could become extremely profitable in the future.
Many investors are comparing SpaceX to Tesla because both companies are linked to Elon Musk, as per Yahoo Finance. Tesla took about 21 months to grow from a $100 billion company to a $1 trillion company. SpaceX has reached an even larger valuation much more quickly after becoming publicly traded. This speed is what makes the current rally unusual.
The catch behind the $3 trillion rally
Investors already believe in the future of the space industry and in SpaceX’s long-term vision, says Yahoo Finance. The real challenge is whether the company’s financial results can eventually match the huge valuation. Right now, SpaceX’s market value reflects profits that investors expect years from now, not profits it is earning today. If future earnings grow as expected, investors could be proven right. If those profits do not arrive, SpaceX’s valuation could come under pressure.
Therefore, SpaceX is close to becoming a $3 trillion company and briefly overtook Amazon and Microsoft in market value. However, unlike most trillion-dollar companies, SpaceX is still losing money.
