- SpaceX insiders got their first opportunity Thursday to sell stock into the public market, as a lockup agreement restricting insider share sales expired and freed up to 911.5 million shares — worth roughly $101 billion — for potential sale.
- The stock tumbled roughly 50% from its peak, closing at $108.27 on Wednesday, following a disappointing earnings call where revenue was reported at $7.8 billion for the quarter.
- The scheduled lockup expiry will enable some employees and early investors who bought pre-IPO to sell, possibly driving the share price further down from its current all-time low.
- A second release of 319 million shares is scheduled for Aug. 12, with more tranches continuing to come free through year-end.
- The complete 180-day lockup runs through early December, potentially freeing up to 5.33 billion shares for trading.
- An extended lockup for Musk and select shareholders runs until June 2027.
- After the IPO, the scarce supply of shares paired with intense interest from retail investors sent the stock soaring, but it has since tumbled down roughly 50% from its record high on June 16.
- SpaceX went public with less than 5% of its total shares available for trading, and Thursday's scheduled unlocking of up to 911.5 million shares will more than double that available number.
- The Nasdaq 100 weights stocks based on their market value and the number of shares available for trading, and SpaceX's weight could rise above 3.5% after the index rebalances in September.
SpaceX's insider lockup expiration on Thursday marks a significant moment for the company, releasing up to 911.5 million shares worth approximately $101 billion. This event more than doubles the publicly available stock, which has struggled since its IPO, with shares closing at $108.27 after a 14% drop on Wednesday.1239
The company's recent earnings report revealed larger-than-expected losses, contributing to the stock's decline. Ryan Lee, senior vice president for product and strategy at Direxion, noted, “You have a few different things triggering volatile action in the name, all happening at the same time.” The stock has plummeted over 50% from its June peak of $225.64, with 35% of the available float currently sold short, according to S3 Partners.
This lockup expiration is the first of several scheduled over the next year, with a second tranche of 319 million shares set to be released on August 12. Peter Singlehurst, head of the private companies team at Baillie Gifford, remarked, “We've never seen anything like it, we've never seen anything of this scale.” The complete 180-day lockup runs through early December, potentially allowing up to 5.33 billion shares to be traded by then.56
Financial advisor Evan Mills emphasized the significance of this moment for employees and early investors, stating, “This is the first real opportunity to turn paper wealth into real, hard cash that they can actually spend.”
“The stock has fallen more than 50% from its June 16 peak of $225.64, with 35% of the available float sold short, according to S3 Partners. A second release of 319 million shares is scheduled for Aug. 12, and the complete 180-day lockup runs through early December, potentially freeing up to 5.33 billion shares.”
qz.com
