Jim Chanos Talks SpaceX IPO

Summary

Podcast Summary: Jim Chanos Talks SpaceX IPO

Podcast: Bloomberg Talks
Host(s): Tom Keene, Scarlet Fu
Guest: Jim Chanos (Founder and President, Chanos & Company)
Date: June 12, 2026
Episode Theme:
A deep-dive, highly candid discussion with famed short-seller Jim Chanos on the much-anticipated SpaceX IPO, broader equity market trends, valuation risks, how the AI/cloud boom echoes the dot-com era, and the mindset of prudent investors in 2026.

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Episode Overview

The episode examines the frenzy and skepticism behind the SpaceX IPO—an historic market event kicking off a wave of tech listings in 2026. Jim Chanos, renowned for his cautious and adversarial views on market bubbles, dissects the underlying financials of SpaceX, draws parallels with historic bubbles, and reflects on the 'Elon Musk premium' that pervades markets today. The discussion moves through the implications of pivoting business models, lessons from past market cycles, the art of short selling, and prudent investment strategy.

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Key Discussion Points & Insights

1. Parallels Between SpaceX IPO & Market Bubbles

• Massive Equity Issuance: Chanos contends the current IPO surge, led by SpaceX, is reminiscent of late-90s and early-2020s speculative booms.

  "Any time you have seen massive IPOs and secondaries relative to the size of the market or the economy, investors generally have been advised to be a little more cautious or reduce their risk." — Jim Chanos [01:17]

• Market Context: 2026 is set to "break records" for tech IPOs, mirroring the supply/demand dynamic last seen during the dot-com and meme stock eras.

2. SpaceX’s Business Model Pivot and Valuation Questions

• Strategic Shift: Chanos finds it "very, very odd" that SpaceX shifted from positioning itself as an AI/software powerhouse to a lower-margin cloud equipment lessor just before IPO.

  "About a week, 10 days ago, the vast driver...in their prospectus was enterprise solutions for xi... And instead they basically did a 180 pivot and said we are going to lease out our capacity to Anthropic and Google. And that's the NEO Cloud model... That is a much lower valued business in the marketplace." — Jim Chanos [03:26]

• Valuation Skepticism: SpaceX is being valued "at about 110 times revenues," a level Chanos finds unsustainable.

  "Just history tells us you just never really make much money buying equities at over 100 times revenues." — Jim Chanos [05:11]

3. The ‘Elon Premium’ and Investor Psychology

• Hopes & Dreams vs. Financial Reality:

  "Does the Elon Premium, is it Elon Premium times two or Elon Premium divided by two? ...Neither of them, let's face it, are being valued on their operations." — Jim Chanos [05:11]

• Tesla Parallel: The discussion compares optimistic narratives around Tesla’s valuation to the even larger leap of faith expected for SpaceX.
  • Tesla trades at 14x revenues, versus SpaceX at 110x.

4. SpaceX’s Real Businesses and Risks

• Starlink:

  "I think Starlink's a real business. It's growing. It will probably continue to grow, although its growth is slowing." — Jim Chanos [06:25]

• Launch Business:

  "The launch business is still losing money after 22 years... the rocket that all of this depends upon, Starship, still has not achieved Earth orbit in 12 missions and half of those ended up with some sort of mishap." — Jim Chanos [06:25]

• AI Subsidiary (xi): Purchased for $250B in stock, it's now considered by the market to be worth over $1.5T, another example of financial hope outstripping fundamentals.

5. Short Selling in Bull Markets

• Surviving and Thriving as a Skeptic:

  "We've been hedged in the short world since 1996. ...We'd rather be long the market and short our collection of radioactive companies, if you will." — Jim Chanos [10:11]

• Shorting Isn’t for Everyone:

  "I don't recommend short selling for most people. It's really for the pros for lots of reasons..." — Jim Chanos [10:11]

• On ‘Radioactive’ Valuations:

  "Anything trading over 100 times revenues is of our interest. Historically returns have been awful at those valuations." — Jim Chanos [11:22]

6. Are We in Dot-Com Bubble 2.0—Or Worse?

• AI/Cloud Boom Surpassing Dot-Com:

  "Oh, this is much bigger. The AI, the build out relative to the TMT build out of '99-2000 is multiples even as a percent of the economy/GDP." — Jim Chanos [11:43]

• CapEx Booms & Profit Mismatches:

  "When you get these capex booms in technology, they're tremendously accretive to earnings... There's a mismatch where the same dollar...is recognized as profits by one entity and deferred by the same people expending the dollar." — Jim Chanos [11:43]

7. Personal Finance Philosophy

• Conservative Approach:

  "It's mostly in my business and ancillary things since I'm semi retired right now... It's mostly passive again for most people. I think that's the way to go." — Jim Chanos [13:10, 13:24]

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Notable Quotes & Memorable Moments

• "Wall Street has a printing press too, just like the Fed. It just takes a while to get going." — Jim Chanos [01:17]
• "It's not a super high tech business yet. Twenty-two trillion of the 29 and a half trillion of SpaceX TAM in their prospectus is based on that [leasing/cloud] business." — Jim Chanos [03:26]
• "Starlink's a real business. It's worth a couple hundred billion dollars. But the real hopes and dreams here is on xi..." — Jim Chanos [06:25]
• "There is a real business [Tesla], in terms of large amounts of revenues and some cash flow. It's not trading at 110 times revenues and that's a magnitude of difference." — Jim Chanos [08:03]
• "Insurance is cheap. Right? And it's cheap for all the reasons." — Jim Chanos [11:15]
• "I think that's really important for your viewers." — Jim Chanos [08:03]
• Chanos' light personal touch explaining he is conservative, passive, and semi-retired now: "It's mostly in my business and ancillary things... It's mostly passive again for most people. I think that's the way to go." [13:10, 13:24]

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Important Timestamps

• [01:17] — Chanos links SpaceX IPO wave to historic market bubbles
• [03:26] — SpaceX’s abrupt business model pivot explained
• [05:11] — The ‘Elon premium’ and risk of following the narrative
• [06:25] — What impresses Chanos about SpaceX (Starlink) and key risks
• [08:03] — How Tesla and SpaceX valuations differ
• [10:11] — Surviving as a short seller in bull markets
• [11:43] — Comparing the AI/cloud CapEx boom to the dot-com bubble
• [13:10] — Chanos’ approach to personal finance today

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Tone & Style

Chanos maintains a measured, data-driven, and slightly wry tone, never afraid to question hype or point out dangers, while the hosts keep the discussion lively, accessible, and at times playful.

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Takeaways for Listeners

If you’ve missed the episode:

• Chanos urges extreme caution with sky-high IPOs and secondary equity offerings, arguing valuations like SpaceX’s seduce with narrative but ultimately pose significant risk not seen since previous bubbles.
• The episode can serve as a cautionary primer for investors caught up in the current tech/AI/IPO mania, underscoring the timelessness of market cycles and the importance of skepticism.
• For those with a prudent or passive investing bent, Chanos validates that approach—reminding even pros that the ‘sure things’ of one era can turn quickly.

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Summary covers core content only; ads, intros, and outros excluded. All quotes verbatim with speaker attribution and timestamps for context.

Transcript

[Jim Chanos]

Indiana University strengthens tomorrow's workforce with practical real world experience. IU grads make a difference in your community, serving as teachers, nurses and engineers who rise to tomorrow's challenges and meet them. Learn more at iu Edu Impact

[Scarlet Fu]

Bloomberg Audio Studios Podcasts Radio News.

[Tom Keene]

Welcome back to Bloomberg Money. I'm Tom Keene with Scarlet Fu. It is a very special edition here. Yes on your personal finance and your retirement. Scarlett, did you get your leveraged ETF set up for SpaceX?

[Scarlet Fu]

You know I can't do that. I am only passive.

[Tom Keene]

You're very passive. Passive. With Space X this morning we're seeing the pricing here with some stability are up 21% off the 150 level. This is indeed an honor joining us now. He's been extremely active on global Wall street in the last four or five days. James Chanos is with Chanos and Company, definitive on the street of a cautious view. Jim Chanos, honored to have you here. Let me just cut to the chase. What is a distinctive feature that makes Space X remind you of Enron?

[Jim Chanos]

Well, I don't know that it reminds me of Enron, Tom, but it reminds me of the Enron time frame. How's that in that? I've always said that Wall street has a printing press too, just like the Fed. It just takes a while to get going. And one of the things that I think Space X is ushering in in 2026 is massive equity issuance and and historically, without a doubt, in the 20th and 21st century, any time you have seen massive IPOs and secondaries relative to the size of the market or the economy, investors generally have been advised to be a little more cautious or reduce their risk. So that 1999, 2000, 2021 for the first half of that year during the meme stock and SPAC craze, we are now going to break records in 2026 for IPOs and secondaries. And Space X of course, is the granddaddy kicking it all off in a big way. But we're going to see OpenAI and anthropic and probably some others. So we're going to shatter years. And so it's telling you that right now supply is meeting demand, which we haven't seen by the way in 23, 24 and 25, but we're seeing it now in 26.

[Tom Keene]

I look Jim Chanos at this and we've got a wonderful amount of time here with Mr. Chanos. So much to talk about. Scarlett's got some themes. I have some themes as well. Ed Ludlow fronted me. See how he did that. Ed Ludlow just stole my thunder.

[Scarlet Fu]

He needed to do it.

[Tom Keene]

Chanos is thinking about the NEO cloud. This is the team here. The New York Times article of a day or so ago, is space x worth $1.8 gazillion? Xi seems to be suddenly changing its business model from developing models like Grok to basically becoming an ad Ludlow Neo Cloud. The entire valuation rests on X AI's progress. The Neo Cloud strategy is a commodity business that is valued far lower on the public markets. Jim Chanos to Isaac and the crew over at the New York Times. They're talking innovation, but you're predicting they go safe.

[Jim Chanos]

Well, what's, what's really interesting, Tom, is that About a week, 10 days ago, the vast driver for the Space X TAM in their prospectus was the enterprise solutions for xi. Basically Grok what, what, what the models produce, right, the software. And instead they basically did a 180 pivot and said we are going to lease out our capacity to Anthropic and Google. And that's the NEO Cloud model, right? That's your equipment lessor. And that is a much lower valued business in the marketplace than being a model company or a hyperscaler. And we've been following data centers for a long, long time. And basically it's a finance business, right? You're buying the chips from Nvidia or somebody else and then you're leasing them out to Anthropic or it's a rate of return business. It's not a super high tech business yet. 22/trillion of the 29 and a half trillion of space X TAM in their prospectus is based on that business. And it just struck me as very, very odd that right before the IPO they would pivot to a much lower margin and lower valuation business than the hopes and dreams which you guys have mentioned. I've mentioned based on producing these wonderful AI agentic software products from Grok. And it's one of many head scratchers about this deal.

[Scarlet Fu]

At what point does financial reality, the kinds of things you were just talking about, breaking down the numbers become more important and matter more than the storytelling, the hopes and dreams part of it. Because that's what Elon Musk excels at and that's what people are buying in on.

[Jim Chanos]

So the question is, is, does the Elon Premium, is it Elon Premium times two or Elon Premium divided by two? I think that that's, that's really the question here because there are people who believe in Elon and have bid up Tesla accordingly to well beyond where I think most fundamental analysts think it's worth because of Optimus robots and autonomous driving and all that good stuff. And now you have another Elon hopes and dreams company with an even bigger valuation. And so does that, does that double, double the value or does it basically say, okay, well I'm going to pick one? Because neither of them, let's face it, are being valued on their operations. Space X is, I believe, depending what I heard in the green room, is probably now at about 110 times revenues. And just history tells us you just never really make much money buying equities at over 100 times revenues.

[Scarlet Fu]

Yeah, well you, as we know, are inherently skeptical. Your company names Kinikos Skeptic. You're not being able on Space X or Tesla or Elon. Musk completely tracks. Is there anything in the Space X financials or Musk's management of the company that does impress you that you can say good job on?

[Jim Chanos]

Look, I think Starlink's a real business. We can look at their businesses again, we have to go on what's in the prospectus. Starlink's a real business. It's growing. It will probably continue to grow, although its growth is slowing. The launch business is still losing money after 22 years. And, and I'd be remiss from my fellow glass half empty participants if I didn't point out that the rocket that all of this depends upon, Starship, still has not achieved Earth orbit in 12 missions and half of those ended up with some sort of mishap. So there's a lot riding on all of that. I think Starlink is a real business. It's, it's worth a couple hundred billion dollars. But, but the real, the real hopes and dreams here is on xi, which is by the way, a company they bought in February for 250 billion in stock that the market is now valuing at probably well over a trillion and a half dollars.

[Tom Keene]

On Bloomberg Television, on Bloomberg Radio worldwide with us, Jim Chanos, thrilled he could join us today in this historic moment for his Wall street and all of us around the world. So the short crew is said Tesla, Tesla, Tesla. Somewhat like Space X and I enjoying a 53% per year return since sort of the beginning of COVID you know, back six years or so. So, you know, again, Tesla's done better than good and there's a model negative free cash flow right now. How long can the optimists of Space X keep this going without delivering a more conventional income statement?

[Jim Chanos]

Well, I think you answered the question right. In years if, if possible. But, but Tesla is trading at about 14 times revenues. Right. It does have 100 billion in revenues and it ramped revenues pretty quickly in 2019 and 2020. So, so there is a real business there in terms of large amounts of revenues and some cash flow. It's not trading at 110 times revenues and that's a magnitude of difference. I think that's really important for your viewers.

[Tom Keene]

I've got, just for the first time, Scott, I've ever looked the same BQ function.

[Scarlet Fu]

Yes.

[Tom Keene]

And the Bloomberg and of course Chainos nails the price to sales because he studied Tom Galvin years ago. I've got 20. Well, right now I've got a number of 27 times revenue. And the BQ screen, it may be a little higher than that. I've never seen a stock like that.

[Scarlet Fu]

So that, I mean, I'm glad you guys bring up Tesla because there is this expectation that Tesla and Space X will somehow merge or will be combined in the same way that X, Space X got combined and merged. How are you thinking through that? What does that mean for investors who believe in the Tesla business but are maybe skeptical of Space X?

[Jim Chanos]

Well, again, if it happens, and I have no idea if it will happen,

[Scarlet Fu]

does Elon need to make it happen?

[Jim Chanos]

No, he doesn't need to make it happen. He can keep them separate if he wants. It's, it's, it's solely up to him. We all know that. But it would be an equity for equity deal. And so I don't know how much value that would add in terms of cutting overhead is not the story here. Right. It's really, it's really what these companies will produce in the next five, 10 years.

[Tom Keene]

I look at this, Jim Chanos is an historic moment and the answer is in cycles. And I opened up talking about Enron and all that. I want you to talk about the short business right now is a hugely important part of financial society. In the this great bull market we're in right now, there's a lot of scars out there. How do you keep that going when you see Space X right now? How do you keep a short model going with bull sectors and a bull trend in the broader market?

[Jim Chanos]

So through 2023 we're running outside money now. We run our own money. We've been hedged in the short world since 1996. Basically our view has been we don't know where the market's going and nor does anybody else. So we'd rather be long the market and short our collection of radioactive companies, if you will. And that's been a very profitable business and it's been a very profitable business for the last few years too, despite the market hitting new highs because there's been a lot of stocks, as you guys know, that have lagged dramatically. So our view is always be long the market and be short some percentage of, you know, companies have bad businesses. And I think that's nothing I would recommend your viewers to do at home. I don't, don't recommend short selling for, for most people. It's really for the pros for lots of reasons, things like getting an interest rebate on your shorts and a variety of other things. But I will say that one of the things right now that is very apparent is that insurance is cheap. Right? And it's cheap for all the reasons.

[Tom Keene]

I don't want to interrupt. Scarlet, want to get four more questions in? Is Space X radioactive?

[Jim Chanos]

We'll have to see where it settles out. You can't short it right now anyway, so it's a moot question. I mean I think that that anything trading over 100 times revenues is of our interest. Historically returns have been awful at those valuations.

[Scarlet Fu]

You mentioned earlier the dot com bubble. Are we doing dot com bubble 2.0 right now?

[Jim Chanos]

Oh, this is much bigger. The AI, the build out relative to the TMT build out of 992000 is multiples even as a percent of the economy GDP. And an important thing to point out is that when you get these capex booms in technology, they're tremendously accretive to earnings. And there's a simple accounting reason why that is when Tom buys chips for his data center from Nvidia. Nvidia recognizes that as revenue and profit. Tom capitalizes those expenses and writes them off over five to 10 years. And so you have a mismatch where the same dollar in a capex boom is recognized as profits by one entity and deferred by the same people expending the dollar. And that happened in 9899 2000. From the middle of 98 S&P operating earnings rose 30% to the middle of 2000 over two years. From the middle of 2000 to the middle of 2001, when order books got pulled S&P earnings dropped 40%.

[Tom Keene]

Was that too much accounting for Friday? I think so.

[Jim Chanos]

I'll leave it. I'll stop at that.

[Scarlet Fu]

Jim, let me ask you one last question before we let you go because this is Bloomberg money after all. How do you approach your own financial planning. How does it compare with how you advise or manage money for others?

[Jim Chanos]

Well, it's mostly in my business and ancillary things since I'm semi retired right now and I'm advising people not, not directly running their money. So it's pretty conservative. But.

[Scarlet Fu]

But so you set and forget or you do make a lot of changes.

[Jim Chanos]

It's mostly passive again for most people. I think that's the way to go.

[Tom Keene]

Jim, we got our merch over here. Scarlet's got her next jacket here ready to go.

[Scarlet Fu]

Let's go. Next.

[Tom Keene]

Me and Marie Horden are going to Santa Antonio. Why are we seeing you in the front row quickly here?

[Jim Chanos]

Well, first of all, I live in Buckle Bucks County, Tom, so I'm outside of Philly. So you're doing a 76 or 6 secondarily. My sons were born in Manhattan, are die hard Knicks fans, but I'm a Milwaukee Bucks fan. I'm a cheese.

[Tom Keene]

I was going to hear that for the record as well.

[Scarlet Fu]

Jim, thank you so much.

[Jim Chanos]

Thank you so much for having me.

[Scarlet Fu]

Jim Chanos, founder and president of Chanos and company. Get the news you need in just 15 minutes.

[Tom Keene]

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[Scarlet Fu]

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[Tom Keene]

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[Tom Keene]

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