Key Takeaways:
SpaceX shares have surged 58% since their IPO, but a staggered lockup schedule threatens to flood the market with new supply by Halloween.
SpaceX's post-IPO rally has pushed its market capitalization past $2.5 trillion, but the stock faces a fundamental shift by Oct. 31 as staggered lockup expirations could more than triple the number of shares available for trading.
"The unlock schedule is designed to avoid a single cliff event, but the cumulative supply increase is still substantial relative to the tiny float," said Brian Mulberry, chief market strategist at Zacks Investment Management.
Only about 4.2% of SpaceX's total shares — roughly 639 million out of more than 13 billion outstanding — are currently available for trading. The first tranche of insider shares becomes eligible for sale after the company's first quarterly earnings report, expected in late July or early August, when 20% of locked-up stock unlocks — rising to 30% if the share price stays above $175. Additional tranches of 7% each unlock on Aug. 20, Sept. 9, Oct. 9 and Oct. 24. By Halloween, roughly one-third of all restricted shares could be free to trade.
The supply wave threatens to cool a stock that has already rallied 58% from its $135 IPO price, though forced buying from index inclusion could offset some of the pressure. SpaceX is set to join the Nasdaq-100 under a fast-entry rule after just 15 trading days, triggering an estimated $7 billion to $10 billion in passive fund purchases.
Lockup Schedule Puts Float Expansion in Focus
The staggered structure differs from traditional 180-day lockups by spreading insider selling across multiple dates. The final major unlock occurs after second-quarter earnings, with Elon Musk's 42% stake — worth roughly $1 trillion at current prices — not eligible for sale until June 2027.
Historical precedent suggests the increased supply could weigh on the stock. Rivian Automotive Inc. fell 21% around its lockup expiration in 2022, while other high-profile IPOs have seen similar post-lockup declines before stabilizing. The last time a mega-cap tech IPO faced a comparable unlock schedule was Facebook Inc. in 2012, when shares fell 13% in the month after its lockup expired before recovering.
Trading Dynamics Create Two-Way Risk
Options trading has already added a new layer of volatility. More than 1.7 million SpaceX option contracts traded on their first day, with put activity rising to 44% of total volume by the close — a sign some investors are hedging against downside. Investor Michael Burry, made famous by "The Big Short," wrote in a Substack post that SpaceX put options remain too expensive to buy at current levels.
Retail investors have been the most consistent buyers, making SpaceX the most-purchased stock each day since its debut, according to Vanda Research data. That buying has matched the combined retail flows into Nvidia Corp., Alphabet Inc., Amazon.com Inc., Meta Platforms Inc. and top Nasdaq 100 and S&P 500 exchange-traded funds. Over the same period, Tesla Inc. has seen roughly $61 million in net selling, suggesting a rotation from one Elon-linked trade into another.
The competing forces — index-driven buying versus unlock-driven selling — set up a volatile path through the fall. If forced buying from index inclusion overwhelms insider selling, the stock could hold its gains or push higher. If supply dominates, the post-IPO rally could give back a significant portion of its 58% advance. The next major test comes in late July, when SpaceX reports its first quarterly earnings as a public company and the first lockup tranche simultaneously becomes eligible for sale.
This article is for informational purposes only and does not constitute investment advice.
