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This is the SpaceX IPO S1 breakdown we have all been waiting for. This is the most anticipated IPO of the decade with the CEO comp plan tied to a colony on Mars. Yes, SpaceX is going public. I have all the numbers and the stats that you need to know about it. And Elon's trillion dollar stock awards only vest if there is a self sustaining human colony of 1 million people on Mars. And I thought EBITDA targets were hard now I'm not interested in Saturn. I said Mars. Okay, you're the boss. Mars it is. Is this thing on? Yesterday's price is not today's price. From the S1. Our mission is to build the systems and technologies necessary to make life multi planetary, to understand the true nature of the universe and to extend the light of consciousness to the stars. You know it felt ambitious when MongoDB said they wanted to build a NoSQL document oriented database in their IPO prospectus. It feels rather jarring to hear SpaceX wants to put people on Mars and expose the secrets of the universe. Passes joint to the left. I am just trying to get my kids to daycare on time because they had to drop this on a Wednesday evening right after dinner and bath time. So somebody was up late. But I'm caffeinated nonetheless. Save some ambition for the rest of us. So back to that whole Mars thing. I am not exaggerating for effect. It is right there on page 235 of the S1. I picture Matt Damon and the Martian farming the potatoes. Like just need to grow a million more potatoes to clear the next vesting tranche. I'm gonna have to science the shit out of this. That's the cleanest thing in the filing. I'm gonna be honest to you. Wait until you see what they did with the accounting. Look how they masked with my boy. The accountants and auditors are gonna be horrified by this. The company filing this S1 is SpaceX plus XAI plus what used to be Twitter. All just jammed into one entity as of February 2026 and presented as if they'd been one company since 2023. The accountants call this common control accounting. Okay, so Musk had a controlling interest in all three companies for all periods present. So under GAAP you can actually recast the financials retroactively. Combine them. Which they did. So when you read 18.7 billion in 2025 revenue, that is rockets plus Starlink subscriptions plus App X advertising plus Grok subscriptions all in one bucket. And the same for the 2.6 billion in operating losses, the 6.8 billion in operating cash flow, and the 20.7 billion in CapEx. Wow. So the historical SpaceX only numbers that you may have seen reported in past leaks, they don't really exist in a clean comparable state anymore. What does SpaceX do? The TLDR Starlink is the part that makes money. Xai is the part that burns it. And the launch business sits between those two, mostly serving them and making them possible. SpaceX has actually been around for more than 20 years. Elon started it in 2002 with the money from the PayPal sale, and the company has raised 11.9 billion in primary funding across 30 rounds since then. 30 rounds. So the reason it took 30 and not three is that go going to space is super expensive. And the early years were mostly explosions. The first thing that made this all possible was figuring out how to land the rocket and use it again. A Falcon 9 first stage booster has now flown 34 times. It launches from either Florida or California. And once it's burned through most of its fuel, pushing the payload upward, the first stage separates from the second stage and falls back down to Earth. The second stage keeps climbing with the payload, and the first stage relights its engines mid fall, slows itself down. This is wild. And. And lands upright on a floating drone ship in the Atlantic. A boat with a name like of course I still love you, which is hilarious. Then a tugboat hauls the whole thing back to port, the booster gets refurbished, and it flies again, sometimes even within weeks. And the first time I watched this happen on a live stream with my kids, I seriously got goosebumps. It's heavy metal. From the prospectus. SpaceX is the only company that has cracked the code on accessing space at scale, revolutionizing an industry characterized by decades of stagnation, risk aversion, and economically perverse cost structures. NASA estimated the first version of Falcon 9 in 2010 brought launch costs down to roughly $2,700 per kilogram from a very large historical industry average of 18,500. Falcon Heavy got it to about 1,400. And Starship, which they're still working on, is designed to take another 99% off if it works at commercial scale. So you can visualize this falling cost curve, which allows the rest of the company to exist. Because you can't run a satellite broadband business if, like, every time you Launch it costs 60 million per ton. You can't possibly dream of putting data centers in orbit. You can't move a million people to Mars. The Whole prospectus is a story about what becomes possible when you take a couple of zeros off the price of getting to see space. So in my simple mind, SpaceX is creating a railroad infrastructure for space. What they put on those rails, whether that's satellites for broadband or AI data centers, it's really anyone's guess. So you could insert the corny sky is the limit joke here, but really they're building the railways, the space they, they own the cheapest possible way to put stuff in space. So the company reports its results in three segments. So bear with me here. They have launch services, about 8 billion in 2025 revenue. And so SpaceX builds and flies rockets, as you know, and customers pay them to put stuff in orbit. The pricing is actually shockingly transparent. You can find it on their website. They even have like almost an uber pool option to go with other people's stuff. And the active vehicles are Falcon 9, Falcon Heavy and Dragon. That's the crew capsule, which has actually carried 78 astronauts since 2020. Starship is that next gen vehicle which is still in test flights and supposed to start delivering commercial payloads later this year. Their customers are NASA, the Department of Defense, the National Reconnaissance Office, which actually sounds like a very large lost and found, and commercial satellite operators. In 2025, they flew 11 of 12 national security space launch missions in all five US crew and cargo missions to the International Space Station. Wow. They control 85% of global launches, which is basically a monopoly. Starlink, about 11.4 billion in 2025 revenue. They're growing 50, 50% a year at 63% EBITDA margins. This is like the Netflix of satellite Internet. You buy a kit, you pay a monthly fee, you get broadband anywhere on Earth. They have 9,600 satellites in orbit that they put up there with the launch capabilities. And they have 10.3 million subscribers across 164 countries. I actually have one in my house in case I ever have to leave my house. And I use it to close an M and A transaction in the Botswana jungle. The fastest growing piece is the B2B side. So they have airlines, cruise ships, oil rig, enterprise IT and government emergency responses buying in larger deal sizes. And they say since 2023, no enterprise customer paying more than 750,000 a year has voluntarily canceled. So they're building an enterprise business there. It's not just me buying one for going camping or something. Then the third bucket is XAI and X. So about 3.2 billion in 2025 revenue, which lost 6.4 billion on operations. So this is the AI and so social media piece. So SpaceX bought XAI in February of this year and XAI had previously bought Twitter in March of 2025. Revenue comes from X advertising, Grok and X subscriptions as well as data licensing and selling AI compute to outside customers. So if you're looking at the revenue from this bucket, it contains both ad dollars from vibrator companies on X and Groq subscriptions from Pentagon analysts running war game simulations. The business burns roughly $1 billion a month. You know what's cooler than burning 1 million a month? Billion dollars. Hey, thanks for listening. We'll be right back after a word from our sponsors. So here's a pattern I keep running into when I talk to finance leaders at fast growing companies. You've outgrown the spreadsheets. You've probably outgrown your billing tools built in Revreck. But you're not quite at the point where you can throw a 20 person team at the problem either. That's exactly the danger zone. Right? Rev owns right Rev is revenue recognition done right. It handles the messy stuff like high volume subscriptions, usage based contracts and mid contract upgrades. The things that break your ERP and the billing platform bolt ons. Here's the thing though. Your sales team isn't slowing down for you. They're closing ramp deals, usage commitments and mid quarter upgrades. And the longer you wait to fix the engine, the further behind you fall. So stop scrambling at month end and stitching together allocations across 3, 4, 5 spreadsheets to just have the numbers read. Well, that's it. That, that's the whole pitch. CFO's telling me it's like a glow up for the revenue books. If that sounds like where you are right now, right Rev is worth the look. Head to right rev.com cj that's rytrev.com cj check em out. I got news for you. The ERP category is finally getting disrupted. And if you haven't heard of Rillet yet, please pay attention. It's the AI native ERP built specifically to replace Netsuite and it's already won over hundreds of finance teams. Their mission is to make these zero day close a reality. And they're actually doing it. We're talking teams closing the books at 1:35pm on the first day of the month. Companies like Windsurf, Mercor and hundreds of others run their entire finance stack on really revenue recognition, close management, multi entity, native stripe and Salesforce integrations. Woo. Everything a scaling company needs. They've got 5.0 start 5.0 wow. 5.0 stars on G2. They're backed by A16Z and Sequoia. Heard of them. And CPA led implementations that get you live in 45 days. That is simply unheard of in the ERP space. If your books aren't running as fast as your business, check out row it. Book a demo@rillet.com CJ that is R I L L E T that's me. Maybe the first thought you had when you started a tech company wasn't about scenario modeling or Runway management or the fine print of an S1. I love a good S1. That's not where the magic happens. It's more fun to build something new, Design your quarter, zip or network with VCs. But what if you got your financials right early, long before your investors started asking? There's no limit to how far you can go and how many headaches you could stave off. Now that's where EY comes in. EY has been a part of Silicon Valley since. Well, it was just a valley. And it's helped some of the most successful names in tech go from startup to exit to mega cap. You build the next big thing. And with the teams across strategy, tax audit and transactions, EY will help you build your next big thing. Right. Learn more@ey.com tech startups that's ey.com tech tech startups all right. The Colossus supercomputer In Memphis is 1 GW cluster. That's a big number. It's the largest coherent AI training facility on earth. And the growth plan involves putting a version of it into orbit where solar power is constant because, you know, in other news, the sun is hot. And they said in the S1 we believe AI infrastructure in space can utilize the virtually limitless power of the sun. Here's some key stats. So, total revenue for the combined entity FY 2025 and $18.7 billion, growing 33% year over year. That was up from 14 billion in 2024 and 10.4 billion in 2023 Q1 of 2026. So the most recent stub quarter came in at 4.7 billion. If you multiply that by four, roughly 19 billion run rate before any back half ramp, which it sounds like they do expect. There is some seasonality to this business. And just a reminder, these numbers include xai nx, recast retroactively under common control accounting. Let's take a look at the segments connectivity segment. That's the Starlink one 11.4 billion, growing 50% year over year, which is nuts. 61% of their total revenue. Consumer broadband at 7.2 billion, up 49%. Enterprising government at 4.2 billion, up 51%. Then the space or launch services to put the stuff up there, 4.1 billion, growing 8% year over year. That's 22% of their revenue, which, and it looks like super slow growth. But the launch business, you have to remember, is increasingly being used to put up Starlink and AI satellites which don't show up as space revenue. So this product line makes the rest possible. AI third segment XAI and X 3.2 billion. Growing 22% year over year, 17% of revenue. The headline growth rate actually hides the fact that X advertising shrank year over year in Grox. Subscriptions and AI infrastructure sales are doing the lifting here. Adjusted EBITDA for FY 2025, 6.6 billion. Starlink alone generated 7.2 of that at 63% margins. The cash cow and the launch business contributed actually 653 million. Not bad. XAI dragged the entire consolidated number down by 1.2 billion. Why? Well, loss from operations in 2025, 2.6 billion. Q1 alone they lost 1.9 billion on ops. The biggest line item dragging this down is the X AI computer depreciation, which runs fast because you know, GPUs lose value pretty quickly. They burn off the walls. CAPEX FY 2025, this is just a staggering number. 20.7 billion on CAPEX AI was 12.7 billion, mostly Colossus and Colossus 2 build outs. Connectivity was 4.2 billion for satellite manufacturing and launch capitalization. Space 3.8 billion, mostly Starship development. Q1 2026. CAPEX alone was 10.1 billion. A single quarter 10 billion operating cash flow. FY 2025, 6.8 billion. Sounds great until you put it next to that 20.7 billion in CapEx I just mentioned. And the 14 billion gap got funded. How are they possibly doing this? Well, with a lot of debt and then those preferred equity raises. Remember those 30 fundraises I mentioned? How much cash do they have on hand? Well, at the end of 2025 they had 24.7 billion, almost $25 billion. But that is now down to 15.9 billion just in March of 2026. So down 8.8 billion in a single quarter. Really, really, really, really leaning into that. CAPEX spend debt outstanding. Large number alert 29.1 billion, which includes a March 2026 bridge loan from Morgan Stanley who is one of the bankers taking them. Public interest expense alone in 2025. 1.9 billion. And I thought I had a bad mortgage rate backlog. This is essentially their RPO. 28.4 billion. So the multi year launch contracts and the enterprise Starlink deals are what make this up. The consumer Starlink subscriptions like the one that I paid for aren't in there because those are billed monthly. 12.1 billion is already sitting on the balance sheet as deferred revenue and about a third is recognized within the next 12 months. So they have a pretty good line of sight on their future revenue. Back to those Starlink subscribers. 10. 3 million up from 4.4 million a year prior. So more than doubled. And across 164 countries. However. However, the average revenue per Starlink user dropped from $81 a month in 2024 to 66 in Q1 2026. So even as a subscriber count doubled, it's going down. So more on that later launch ops 170 launches in 2025 2,213 metric tons to orbit more than 80% of the world's total put in orbit 99% mission success rate across roughly 650 cumulative Falcon launches. One Falcon 9 booster has now flown 34 times target valuation. Hope you're wearing a helmet. 1.5 to $1.75 trillion. They're planning to raise 50 to 75 billion in primary capital at this offering. The largest IPO in US history before this was Saudi Aramco in 2019 at 29 billion of capital raised. They're targeting a mix of roughly 30% retail investors which is bonkers. The typical IPO is 10% or less, so that'll help. The St Macaron and Tesla's market cap is around 1.3 trillion at the moment. Tesla will be smaller if things go to plane which is mind blowing. CEO voting power post IPO 85.1% that is Musk Class B shares get 10 votes per share. Musk holds 93.6% of Class B. This is considered a controlled company under NASDAQ rules. SpaceX is opting out of the independent board requirement. This is called the Starlink section. It was late. I couldn't come up with a creative title. I know they say in their S1 connectivity infrastructure in space is designed to help everyone on Earth have access to education, healthcare, entertainment and communications and to enable people to overcome many traditional limits such as physical and political borders. I'm picturing that Kendall Jenner Pepsi commercial where she's curing all its problems. Starlink is the only part of SpaceX that makes money right now. It threw off 7 billion of segment EBITDA in 2025, like I said, 63% margins on 11.4 billion of revenue. And that cash is what is funding Starship XAI and everything else in the prospectus that incinerates capital. The subscriber count, like we said, more than doubled from 4.4 million to 8.9 million and then they hit 10.3 million if you stretch that out in the 15 month period, March 2026 across those 164 countries. So Mr. Worldwide, about three quarters of all active maneuverable satellites in low earth orbit belong to SpaceX. Simply there is no second place competitor. The number that should make you uncomfortable though is the average revenue per subscriber per month that we mentioned. It was $99, so almost 100 bucks in 2023. It was 66 in the first quarter of this year. Wow. That is a 1/3 decline in three years with most of the drop happening in the most recent 12 months. So the S1 explains why directly they said international expansion into markets where like 100 bucks is too expensive. You and the introduction of cheaper service tiers like the Starlink mini residential plan to cause a drop. So the price is dropping on purpose to grab subscribers in places that cannot afford the original price point. So, so bear with me here, to use another analog Netflix charges different amounts in different countries to match the purchasing power of consumers in the region. That price drop only works though if the cost of adding each new subscriber drops faster than the price does. And I think it probably does, at least for now. The expensive part of this business is putting satellites in space. The satellites are mostly already up there and the factory that's making the other satellites is already running. So once a customer in a new country plugs into Dish and starts paying, they are pure margin until the satellites above them run out of capacity, which is really a problem SpaceX keeps solving by launching bigger and bigger satellites. So the next generation can carry roughly 20 times the bandwidth of the current one to orbit on the same rocket. The customer mix is also moving toward higher quality revenue. The consumer broadband revenue grew 49% in 2025 to 7.2 billion. The enterprise and government revenue grew 51% to $4.2 billion. The enterprise side has gross margins above the consumer side and churn, that is essentially zero. So since 2023, like we mentioned, no Starlink Enterprise customer paying More than three quarters of a million dollars has canceled and that number is really unusual in consumer adjacent infrastructure. I actually have to read through it a couple times just to make sure I was understanding disclosure curve. Like the customers are United Airlines, Carnival Cruises, John Deere. These are companies that can't afford to switch because their customers are rural and there is really nobody to switch to. There's also the EchoStar deal which is how Starlink eventually gets into the cell phone in your pocket. So SpaceX agreed in late 2025 to buy roughly 20 billion of wireless spectrum from EchoStar in cash and equity and the FCC cleared the transaction in May of 2026. Just happened and and it is expected to close in November of 2027. So Spectrum is what lets Starlink connect directly to a phone without a Starlink dish in between and without the Echo Start yield. The direct to phone product is limited to texting and emergency messaging. Not that great with it, the same dish free service can carry actual broadband. So that is major TAM expansion. I have a Starlink dish in my house. Like I said, I pay about $120 a month for when I use it. But I haven't turned it on in two years. I haven't used it in two years and my in laws have one in their cabin. My neighbor has one on a sailboat. And like I said, I actually use mine for business in the jungle. The next 10 million subscribers will probably not look like me. They will look like a family In Nairobi paying $25 a month, a lower amount for a connection that powers a village clinic. Each of them will add less revenue than I do, but they'll use it more often. And each one will costs less to serve as the infrastructure is amortized over a larger base. At 10 million subscribers and $66 of ARPU, Starlink is already generating 7 billion of EBITDA at 30 million subscribers and $50 of ARPU. So I'm having it with Constellation costs roughly flat. The math will get you something closer to 18 billion. If you extrapolate this all the way to 50 million subscribers and $40 of ARPU, you're now north of 25 billion. The bear case is that ground operations and customer support costs scale linearly with subscribers rather than asymptotically. In which case The MAR compresses from 63 towards something more like a regulated utility, which wouldn't be great and a lot of the IPO valuation will compress with it. So about that consolidated entity. Consolidated is doing a lot of work today. The financials in this S1 are not really SpaceX if we're being like truly honest. They're SpaceX plus XAI plus what used to be Twitter mashed together and recast back to 2023 as if they had always grown up in the same household. The accounting term is common control accounting. When one person controls multiple companies, it combines them. Gap treats it as a reorganization, not an acquisition. So there is no purchase price allocation, no goodwill, and no clean before and after. The reader just gets one set of numbers and is asked to take it as a whole. Take it or leave it baby. The 2024 revenue line everyone is going to quote will include a full year of Twitter advertising. The 2024 R&D line is mostly XAI compute, not Starship development. None of the prior SpaceX leaks compare to anything in this document. Where it gets uncomfortable is the Related Party section, which runs nine pages. Hey, thanks for listening. We'll be right back after a word from our sponsors. One more thing about Spendhound Teams using Spendhound reduce software spend by up to 30%. Here's how that actually happens. First you get the data Real pricing benchmarks from over 1,000 companies across 10,000 SaaS and AI benchmarks. When a renewal comes up, you know what fair pricing is and what you should be pushing for. But knowing the number and getting the number are two different things. 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Because there are two kinds of finance work. The kind that moves the business forward and the kind that just keeps it from falling flat on its face. And too many finance teams are buried in the second kind and they call it a good week when they just get through it. Expense reports that take longer than the trips they cover spend policies living in PDFs that no one reads. A three day approval process for a $40 receipt. That's a lot of burritos, but not worth it. Month end close that stretches into weeks. These aren't edge cases, they're the default state of finance at most growing companies. And the cost isn't just the time, it's what your best people aren't doing. While they're buried in the wrong work, you become what you spend on. And right now too many finance teams are spending on maintenance instead of momentum. And that is why I use Brex Agentic finance that captures receipts, automatically, enforces policy before the spend happens, and closes your books in minutes rather than weeks. So your finance team stops spending on maintenance and starts spending on momentum. 35,000 companies like OpenAI, Coinbase, Anthropic and Doordash already run on Brex because high density talent deserves some high leverage systems. Time to get Brex AF can't believe they let me say that. Learn more brex.commetrics that is brex.commetrics I've seen a lot of FPA tools and a laugh is one of the few that gave me that aha moment. Within minutes I remember watching their founder shout out to Albert, connect my netsuite data and build me a full P and L live in minutes. Alaph is now trusted by hundreds of leading companies. I've had the CFOs from Turo 8, sleep, Zapier and more on the pod and every one of them is a huge advocate. I also just published my second annual CFO Tech Stack Report and Aleph has been on the podium both years including a number one finish in the 50 to $100 million segment. This year instead of being just another planning tool, they built a real enterprise grade data foundation for finance implemented at startup speed with AI native workflows woven into its DNA. All your systems erp, CRM, hris, ats, product usage and more powering one clean governed data layer that finance can actually trust. With AI moving as fast as it is, they're pushing even further. Mcp, custom AI chatbots, AI powered variance analysis and the list keeps growing. Try it with your own data at get a left.com run that is G E T A L E P H.com run tell them CJ sent you. Let's look at some of their investors here. Antonio. Gracias. Thank you. Sits on the SpaceX board and runs Valor Equity Partners, which manages 55 billion across fleet of funds. Valor is also a major shareholder, holding around 7% of the class A common stock through dozens of affiliated entities. The unusual part is that XAI subsidiaries have signed three separate equipment lease agreements with Valor for aggregate cash payments of 7 billion, 6.6 billion and 6.6 billion again, 20.2 billion in total. That is a lot of beans. SpaceX is the guarantor on all three. The S1 does not specify what equipment is being leased, but the timing and the dollars coincide with the GPU clusters sitting inside colossus. So Valor's CEO sits on the SpaceX board. And by the way, SpaceX board approved the SpaceX guarantee. Interesting. Then there's Tesla, which Musk also runs. Xai bought 506 million of goods and services from Tesla in 2025 and another 34 million in the first couple months of this year. SpaceX bought another 144 million. Tesla committed to invest in XAI in January, and when SpaceX acquired X AI a month later, that investment converted into a SpaceX equity stake. So they're on the cap table. The two companies are also working on a joint chip manufacturing project called Terrafab, which the prospectus describes at length without specifying a timeline, Capex or milestones. Very nice. I have personally sat in audit committee meetings where we just debate a single $200,000 related party transaction. The Tesla footprint here is north of 700 million just in a single year, so go figure by the way. And if we're keeping score, there's also a security company owned by Musk that protects him and bills SpaceX for it. There's office space that X leases from a Boring Company subsidiary. Forgot the Boring Company was still around. Also owned by Musk. There is property in another state that XAI leases from an entity called Musk Industries LLC. There's SpaceX owned aircraft that Musk uses to do Tesla business with Tesla build for the time. The Cerebras related party section that I analyzed last week looked like the cap table of a Targaryen wedding. SpaceX makes Cerberus look like a team holiday party at your local vfw. Some financials. I've covered a lot of it already, but just to call out a couple things, they spent 8.6 billion on R and D last year. That was an increase of 149% year over year and it represented 46% of their revenue. So for comparison, Cerebras spent 48% of revenue on R and D last year. This is 46. Nvidia spent 12%. Nvidia is very much at scale. About 3 billion of this is starship development inside the space segment. The rest is mostly XAI compute depreciation, which is what happens when you buy 12 billion of GPUs that lose value pretty fast. SG&A, they blend it together. 2.6 billion, growing 46% year over year. 14% of revenue, which is actually kind of modest for a company with 10 million consumer subscribers. Starlink mostly sells itself because people in remote places want Internet and there's not really any other provider there. Restructuring charges. Hmm. Almost 500 million, up from just over 200 million in 2024. The S1 attributes it mostly to X because letting go a lot of people at the company formerly known as Twitter is expensive. Remember, he cut it in more than half. Interest expense 1.9 billion last year tied to the 29 billion of debt outstanding. It includes a 1 billion bridge loan from Morgan Stanley that closed in March of 2026. Operating cash flow 6.8 billion. All of it came from Starlink subscription billings collected up front. I love when it's collected up front. Capex was 20.7 billion. So the 14 billion gap. We have a gap mind. The gap got funded with 26 billion of debt and preferred equity raised during the year. Cash on hand, almost 25 billion in the year, but just under 16 billion three months later in March. Down 8.8 billion in one quarter. Because Q1 CapEx was 10 billion. That backlog, we said it before with 28 billion. 12.1 of that already collected as deferred revenue. Pretty nice when you get that cash up front. About a third recognized within the next 12 months. So the Starship line in R and D is the one to watch. Because if Starship slips another year, that 3 billion line goes up and up and up before any of the orbital AI Compute or next gen Starlink revenue starts ramping up. The whole growth case sits on Starship working at commercial scale in 2026. So potential red flags. And like hilariously, the risk factors section is a picture of a rocket that looks like it's exploding. There's a lot of fire. The CEO Comp award fully vested a million people on Mars. One billion restricted Class B shares granted to Musk in January of 2026. Vests in 15 tranche. Wow. Some steps in that. Each tranche requires both a market cap milestone from 500 billion up to 7.5 trillion. That is a huge number. And the establishment of a self sustaining human colony on Mars with at least 1 million people. A separate 302 million shares award at a market cap of 1 trillion to 6.5 trillion. Plus the construction of non earth based data centers delivering 100 terawatts of compute. So once again putting those data centers in space to use the Sun's power. The board actually approved this in writing, which is hilarious. Starship is a big part of the growth case and has not flown a paying customer yet. That's, that's a risk factor. Starship is the next gen rocket SpaceX is building. Designed to be twice the size of Falcon 9 and fully reusable. The second stage comes back to not just the first. It is the only vehicle big enough to put V3 Starlink satellites, orbital data centers or anything heading to the moon or Mars into space at the scale and price that SpaceX is selling us on. Right. The cost curve falls with this. They've done 11 test flights to date, but commercial payloads are scheduled to begin in the second half of 2026. Per the prospectus, v3 Starlink, Orgo, AI compute, the lunar economy and the Mars colony from that first item all require Starship to work at commercial scale. And the space segment is running about 3 billion a year of Starship specific R and D inside that segment's results, with no starship revenue offsetting it yet. So SpaceX listed this at the top risk factor on its own list. Okay, so it's not just me. Next risk factor. Musk is on every line of the org chart. He's CEO, CTO and chairman with 85% voting power. This is very much a dictatorship. He's the CEO of Tesla. Bet you knew that. The founder of the boring company and the principal of XAI before the merger. So SpaceX owns aircraft that he uses, like we said, bills Tesla for the time the security firm protecting him paid by SpaceX. And he. What's this? He pledged 237,530 of his class A shares as collateral against personal loans. Nice to get those loans. Number four, the cursor option has a 10 billion downside of SpaceX Walk. So remember about a month ago they made a deal with Cursor. It's basically a call option to buy them at $60 billion after the IPO using the SpaceX stock. So in April they entered into that compute agreement in an option to acquire cursor at 60 billion. That was the implied equity value. So SpaceX terminates that option or cursor terminates for SpaceX material breaches. SpaceX owes cursor 1.5 billion in termination fees and 8.5 billion in deferred services fees. That's gotta be like the largest breakup fee. I don't actually know if it is, but I remember when Adobe broke up with Figma, it was 1 billion. The acquisition itself, if it happens, would be paid in SpaceX Class A stock. So not the B1 that Musk has. Number five, the X advertising business is shrinking. The AI segment in advertising revenue declined 100 million year over year in Q1 of 26. The S1 attributes it to an overhaul of the company's advertising platform, which impacted ad sales for a short period of time during the rebuild. Well, if you remember that interview he did at the deal summit with sorc, and he did tell Disney to f off go yourself. The advertising business inside the AI segment is the X ad business and it is going backwards while the rest of the segment grows. Cap table and IPO structure. Let's go over the mechanics of the offering. Two classes of common stock, like we said, Class A1, boat, Class B10. Both trade after the IPO, but only Class A is being sold. It'll be listed on both the NASDAQ and the NASDAQ. Texas, that's a new one. Under the ticker SPCX. The Texas exchange is brand spanking new and SpaceX is the marquee listing IPO range not disclosed in the S1 secondary market. Transactions in Q1 though, cleared at roughly 95 bucks per share pre split, which implied a fully diluted valuation of 1.2 trillion at the time. But press reports have the target IPO valuation of 1.5 to 1.75 trillion, which would make this the largest IPO in US history by a factor of like a bajillion. And they plan to raise, like we said, 50 to 75 billion, which will help fund the AI compute infrastructure, the launch capacity in the Starlink buildup. 30% of the offering is going to retail, which is worth talking about because it very much like implies like they think it's going to be a meme stock because a typical IPO allocates only 10% or less to retail investors. There's an army of people who are in their basement somewhere who Love Elon Musk. SpaceX is reserving roughly 30% for them. The mechanism is a directed share program where the underwriters set aside class A shares for sale at the IPO price to employees of the company and certain Other designated individuals. And these directed shares don't have lockups so they can skyrocket. The decision creates a different kind of opening day. Three times the normal retail base. No lockups on those shares in a stock that is already a meme. Class A shares held by institutional and pre IPO investors carries the usual 180 day lockup as well as employees. Index inclusion will force buying within weeks. This is a big one. Okay, so bear with me here. The S&P 500 to get included in that it happens within 15 days for IPOs that meet the size threshold with SpaceX will blow by Index fund managers don't choose whether to buy just like one share. Once SpaceX is in the index, every S&P 500 tracker has to hold it at its index weight. So at a 1.5 trillion market cap, the index weight would be roughly 3%. Which is the kind of position that requires real selling elsewhere in the index to fund it. And the same dynamic applies to people's 401k targets, most large pension funds and the bulk of corporate retirement plan. So it'll get shuffled in there. Other major holders, Antonio Gracias and valor entities collectively hold about 7.3% of Class A common stock across the dozens of fund vehicles list. In the perspectives this guy is long. SpaceX Tesla owns roughly 1% of the Class A shares post IPO. Other named pre IPO investors include Google, DFJ Growth and a Long Tail of Growth equity funds. The Cursor acquisition, if SpaceX exercises the option, would be paid in class A stock like we said, at the volume weighted average closing price over the seven trading days before close. A stock pop on opening therefore makes the deal more expensive in shares for SpaceX to consummate and therefore diluting existing shareholders. So keep that in mind. Let's talk about the underwriting bracket. So Goldman Sachs surprisingly lead left. Everyone thought this was going to be Morgan Stanley. The senior bracket does include Morgan Stanley on the first line along with bank of America, Citi, JPM, Deutsche Bank, RBC, UBS, Wells Fargo and Barclays ended up on the second line there too. A second tier brings in the likes of Allen Company, Cantor Needham, Raymond James, Society General, Steve O and William Blair. A third tier rounds out the COVID with BTG, Pactual, ING, Macquarie, Marais Asset, Mizuho in Santander. Wow. 22 underwriters total. That's how much they need to raise. It's 5075 billion. Like 30% of the float goes to retail without lockups and the rest gets vacuumed into the S&P 500 trackers within two weeks. The price discovery in the opening month is happening between meme stock buyers and Force index buyers. I'm being honest with you. With very little real selling pressure on either side, it's an unusual setup and it's where most of the IPO action probably comes from. Valuation from the S1 we believe that space represents the largest economic frontier in human history. The honest way to value SpaceX would would be a multi business comp ladder. So Starlink recurring connectivity is closer to T Mobile or a tower reit. The launch business is closer to a defense prime like Lockheed or Northrop. XAI is closer to a private frontier model lab like, I don't know, like an anthropic. But nobody would value Bloomberg by applying one multiple to the whole company. You would value the terminal one way, the news operations another way, and the trading systems the third way. SpaceX is that plus rockets plus a satellite ISP plus an AI lab plus a social network. So go figure. The simpler version is one forward revenue multiple against the public comp. So 2026 revenue growing each segment at its current rate. Connectivity at 50, space at 8, AI at 22 lands at roughly 25 billion. Before this came out I thought they were going to be closer to 28 billion. If you extrapolate it out. So a little bit lower. 25 billion in the next 12 months at a 1.5 trillion market cap. Whoo. That's a 60x forward revenue multiple at 1.75 trillion. Woohoo. 70x forward revenue multiple. We're past Palantir territory where the public market currently is. Cerebras is number one from last week. They're trading at 50x forward. Palantir is trading at 36x forward. CrowdStrike is trading at 24x forward. Cloudflare22 Bullish17 the top 10 median in tech is trading at 16. The overall median is trading at only 3x. They want 60 to 70x Tesla for context. Trading at 14x forward revenue. NVIDIA18 SpaceX is asking the market for somewhere between 1.2 to 1.4x the Cerebras multiple, which is the highest out there on a company that loses 2.6 billion at the operating line. So at that multiple you're not really pricing their 2026 results. You're pricing a 2030 outcome in a world where Starlink is doing 40 billion of revenue. Starship is reusable at scale and at least one of the orbital AI computer Mars optionalities has started to print real numbers. So to be fair, you're pricing the value of monopolistic space power. That's what you're doing. What you are buying at 1.5 trillion is conviction that Musk delivers on a 2030 set of milestones the rest of the market has never priced for any single CEO before. But like, how could it so some miscellaneous fun stuff. Of note the NASDAQ Texas listing I mentioned earlier. So SpaceX is dual listing on Nasdaq and Nasdaq Texas under the ticker SPCX NASDAQ Texas is a brand new exchange that launched in 2025 in response to political pressure on companies leaving Delaware. SpaceX Re domiciled to Texas in 2024 and moved its headquarters from Hawthorne, California to Starbase Texas in early 2026. Probably because billionaires don't like paying extra California taxes. If I'm being honest. Whatever you think of the exchange, hosting the largest IPO in US history gives it real institutional credibility on Day Uno Next when the CFO's award works the way a CFO award should so Brett Johnson, their CFO 4 million performance based options were amended in January of 2026. The new vesting is 371,125 options per 10 billion of adjusted EBITDA achieved during fiscal year 2025 through 2029 assessed annually, zero options vested based on 2025 performance. Because he didn't hit that, Brett Johnson has like the only sane compensation plan in this entire filing, which says something about either Brett Johnson or this filing. Bitcoin is on the balance sheet. SpaceX holds Bitcoin as a Treasury asset marked a fair value based on quota exchange prices. The dollar amount isn't broken out in the summary, but it's referenced in the Accounting Policy section under Digital assets. That puts SpaceX in a cohort of roughly a dozen large companies holding Bitcoin directly on the balance sheet alongside Tesla. Also Musk, Microstrategy, Michael Saylor and Block Jack Dorsey. Disclosures Disclosures Disclosures none of this is investment advice. Do your own homework. I wish you an IPO with separated stages and a soft landing. Peace. Run the Numbers is a mostly media production, yelling and intro by Fat Joe. Artwork by Meg d'. Alessandro show is executive produced by Ben Hillman. Nothing said on this podcast is intended to be business or investment advice. It's the sole opinion of me, a guy who feeds his dog way too much ice cream and has a history of net operating losses. Lol. If you like this podcast, hit subscribe and give us five stars. It will take, like, two seconds. And our algorithm overlords love it. Drink water, call your mom, and have a great day. Peace.