SpaceX stock has tumbled to its weakest level since going public, with the shares closing at $101.04 on Wednesday — a 6.76% single-day slide that pushed the price 48% below the June peak of $194.46. The sell-off comes just hours before the company’s thirteenth integrated Starship test flight, but the real weight on the stock is coming from a different direction entirely.
Short Sellers Pile In as Lock-Up Date Nears
The most significant pressure point is the August 6 expiration of lock-up agreements covering approximately 911.5 million shares. That event, falling just two trading days after SpaceX’s first-ever quarterly earnings report as a public company, could flood the market with stock worth roughly $116 billion. With the company’s initial public float sitting at under 5%, the sudden release of restricted shares from early investors and employees could quadruple the available supply.
Traders appear to be front-running that event. Short interest has exploded to around 32% of the free float, representing bets worth about $25 billion against the stock, according to S3 Partners data. That marks a fourfold increase in short selling within a single month.
Elon Musk took to X to warn short sellers, posting that the survival probability for bets against his company is very low — language he has used before during turbulent periods at Tesla.
Starship Flight 13 Carries Heavy Expectations
The test flight scheduled for Thursday evening carries its own set of risks. The launch window at SpaceX’s Starbase facility in South Texas opens at 22:45 UTC and runs for 90 minutes. This mission, using Booster 20 and Ship 40, marks the first test of the new “Block 3” architecture.
The stakes are unusually high. For the first time, Starship will attempt to deploy 20 satellites from the new Starlink V3 generation, which promise higher data throughput and direct cellular connectivity. Six of those satellites carry additional cameras to monitor the rocket’s heat shield — data that will determine whether Starship can eventually return to its launch site for reuse.
The flight comes after two false starts. A July 16 attempt was aborted just before liftoff when two Raptor engines missed their ignition parameters, requiring replacements. A second try on July 20 also failed. SpaceX has since reworked the Super Heavy booster’s engines.
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Beyond the immediate mission, the flight has implications for NASA’s Artemis IV program, which depends on a functional Starship lunar lander, and for the entire business case of cheaper space access that underpins the company’s valuation.
First Earnings Report Adds Uncertainty
Sandwiched between the test flight and the lock-up expiration is SpaceX’s first quarterly earnings release, confirmed for August 4. Investors will get their first look at the company’s balance sheet and segment revenues as a listed entity.
Starlink generated an operating profit of $4.42 billion in 2025, making it one of the few profitable divisions. But concerns are mounting over capital spending on the xAI artificial intelligence unit and the recently announced $60 billion all-stock acquisition of AI coding startup Cursor. Analysts expect second-quarter revenue to jump to roughly $6.98 billion, though the company is not projected to achieve positive free cash flow until the next decade.
Chart Indicators Point Both Ways
The technical picture is ambiguous. The relative strength index stands at 33.5 — territory that typically signals an oversold stock. But with annualized 30-day volatility near 90%, the shares remain vulnerable to violent swings in either direction.
Cathie Wood’s ARK Invest has been buying into the weakness, investing more than $36 million as the stock dipped below its IPO price. That vote of confidence from a high-profile long-term investor contrasts with the broader market’s nervousness.
The next two weeks concentrate three major risk factors: the Starship test on Thursday, the earnings report on August 4, and the lock-up expiration on August 6. A clean launch with all 33 Raptor engines firing could shift the narrative back toward operational strength. But with short sellers holding a record position and a wall of stock about to become tradeable, the path to recovery looks anything but smooth.
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