Comparison of historic mega IPOs, what will the market look like after SpaceX's listing this time?

This Friday, June 12th, the world's largest IPO in history, SPACEX, will go public. What will happen to the market afterward? Many people are probably very curious. Let's look at the historical data to see what might happen after SpaceX's listing.

Currently, SpaceX has a financing scale of $75 billion, with an IPO offering price of $135 per share, issuing approximately 556 million shares,

Corresponding valuation: about $1.75 to $1.8 trillion.

If underwriters exercise the over-allotment option: the financing scale could reach around $86 billion.

Previously, the highest market cap for an IPO in the US stock market was Alibaba, which listed on NASDAQ on September 19, 2014, with an IPO size of $25 billion.

Second place is Meta, formerly Facebook, which listed on NASDAQ on May 18, 2012, with an IPO size of $16 billion.

So compared to previous record IPOs, this SpaceX can be described as "unprecedented," entering the trillion-dollar market cap club immediately upon listing, and Elon Musk will also become a billionaire with a net worth exceeding one trillion dollars in human history!

But actually, SpaceX isn't very profitable. According to publicly disclosed data, its revenue in 2025 is about $18.7 billion, a year-over-year increase of approximately 33%, and it still has about $4.9 billion in losses in 2025.

So SpaceX is still in the money-burning stage, but yesterday we mentioned that Musk has instilled in people a very promising business—interstellar exploration + Mars colonization—so a high market value is an estimate of the future growth potential.

Since such a large-scale IPO requires raising $75 billion, and there isn't much extra money in the market, it will definitely drain liquidity. Institutions might sell their stocks to buy SpaceX, leading to a sharp decline in some stocks, such as the 4% drop in US stocks last Friday, which could have been caused by brokerages selling stocks to free up funds.

Historically, what happens to the market after such a big IPO?

Let's look at Alibaba. On September 19, 2014, Tuesday, the market peaked around September 3, which was about five days before Alibaba's IPO. The combined decline on September 3 and 4 was about 1%. On the IPO day, September 9, the Nasdaq also fell 0.8%. Over the following month, the Nasdaq continued to decline!

I also checked the timeline at that time, and there were no macroeconomic adverse factors, because after 2000, the Federal Reserve maintained zero interest rates and unlimited QE.

Next, let's look at Meta's listing. It was on Friday, May 18, 2012. The US stock market was already in a decline phase, falling for nearly two months. On Meta's listing day, the US stocks also declined, and they had been falling in the days prior, but the market recovered and performed well after about a month.

There’s also Visa, which went public in 2008. It raised $17.9 billion, and its valuation was high, but we know a financial crisis occurred in 2008, so we won't consider that.

In fact, from these two cases, we can see that before a super IPO, the market is almost always weak because funds are flowing out. After the IPO, the market might start to recover.

Many also say that SpaceX's listing is a short-term top signal. Because there's a pattern that even "good companies tend to go public at the most optimistic market times."

For example, during the dot-com bubble peak in 1999, many internet companies went public, and the Nasdaq plummeted afterward. Similarly, Coinbase's IPO in 2021 marked the top of the bull market in 2021.

SpaceX's attributes might draw funds away from tech stocks, AI growth stocks, and risk assets, potentially forming a short-term top. Moreover, SpaceX's performance and valuation aren't enough to justify such a bubble, and many platforms now offer pre-IPO trading. I checked the prices, which are around $200–$170, while the IPO offering price was $135, which is obviously overvalued.

An IPO price of $135 already indicates an overestimated valuation, and pre-IPO prices are even higher.

I believe SpaceX's story is well-packaged, with a lot of imagination potential. But in the short term, valuations will likely be cut down because initially, its valuation was only about $180 billion in early 2024, $400 billion in early 2025, and $1.2 trillion in early 2026. Elon Musk forcibly linked Twitter and AI to SpaceX's business, causing its valuation to soar to $1.7 trillion. You should know that Musk spent about $44 billion to acquire Twitter, and now, with a sudden increase of $500 billion, it has multiplied tenfold, which seems unreasonable.