SpaceX's IPO is making history. According to reports during the midday session of the US stock market on Thursday, the rocket and satellite company attracted over $100 billion in retail subscription orders. Subsequently, the company's announcement confirmed the IPO price, which is expected to create the world's largest IPO fundraising transaction.
According to Bloomberg's report on Thursday, informed sources revealed that retail investors are expected to receive at least 20% of available shares. Based on the IPO size of $75 billion, this means that the subscription needs of a large number of retail investors will not be met. At the same time, about 1000 institutional investors have also submitted subscription orders, and the international allocation share is expected to be less than 10%, with Japan's allocation amount raised from $2 billion to $2.5 billion earlier this month.
Subsequently, CNBC reported that insiders revealed that SpaceX plans to allocate slightly over 20% of its share to retail investors, including international individual investors, online brokerage clients, and private banking clients, which is much lower than the previously estimated 30% share. The insider said that the distribution plan has been basically finalized, but there may still be changes.
Before SpaceX announced its IPO price, the expected fundraising of $75 billion had already triggered a chain reaction in the market. In order to raise funds to participate in this IPO feast, retail investors have sold individual stocks net for three consecutive trading days - the first time such a situation has occurred since March 2020.
Chip stocks and recent AI concept stocks are the first to bear the brunt, with stocks such as Micron, Qualcomm, and Broadcom coming under pressure one after another. Analysts warn that with multiple large IPOs coming one after another, market volatility may further intensify.
Record subscription scale, pricing terms largely locked in
According to SpaceX's announcement on Thursday Eastern Time, the IPO price is set at $135 per share, with plans to issue 555.6 million shares and raise approximately $75 billion. In addition, SpaceX has granted underwriters a 30 day Green Shoe mechanism option, allowing them to purchase up to 83.33 million additional Class A common shares at the initial public offering price.
If the IPO is ultimately completed at $75 billion, SpaceX will surpass Saudi Aramco's record of $29.4 billion set in 2019 and become the largest IPO in history. Based on the issue price estimate, SpaceX's company is valued at approximately $1.8 trillion.
The enthusiasm of individual investors for subscription is particularly prominent. More than $100 billion in retail orders far exceed the upper limit of their allotted shares - even if calculated at a 20% allocation ratio, the vast majority of retail demand will still fall short under the $75 billion issuance scale. This means that a large number of loyal fans of Musk will not be able to enter the IPO stage, which may further drive up demand after the stock is listed for trading.
BNP Paribas analyst James Picariello estimates that retail investors hold approximately 40% of Tesla's shares, indicating a high level of identification with Musk's company. SpaceX has also reserved up to 30% of the issuance shares for retail investors, and Fidelity has lowered the customer participation threshold to only $2000 in account balance.
Retail investors sell tech stocks to free up funds for SpaceX
The enthusiasm of retail investors for SpaceX is putting pressure on their existing holdings in technology stocks. According to data from Vanda Research, non professional traders have sold individual stocks for three consecutive trading days, marking the first time since March 2020, with sales concentrated in chip stocks and recent AI concept stocks.
On Monday, the amount of funds withdrawn by retail investors from individual stocks reached its highest level since November 2023; On Tuesday, when technology stocks led the decline in the S&P 500 index, retail investors also chose to wait and see. Micron was among the biggest losers in the S&P 500 during Tuesday's technology stock sell-off, while Qualcomm fell another 6.9% on Wednesday and Broadcom fell 5.1%.
Vanda Global Macro Strategist Viraj Patel said:
" Current evidence suggests that retail investors may be stockpiling ammunition for the upcoming IPO. According to the pattern of previous years, the market activity at the current time point should be slightly higher than it is now, and certain factors are causing retail investors to remain inactive. "
Greg Boutle, Head of US Equity Derivatives Strategy at BNP Paribas, pointed out that Micron's decline may be due to individual investors; Sell recent winners and leveraged products; The manifestation of investing in SpaceX.
Multiple IPOs overlap, increasing market volatility risk
Analysts point out that SpaceX is not the only upcoming large-scale IPO, and plans for the listing of Anthropic and Sam Altman's OpenAI are also underway. Coupled with large-scale stock sales of existing technology companies, the market pressure may continue.
DA Davidson & Gil Luria, Director of Technology Research at Co., stated in a Bloomberg TV interview:
" Investors will have to release funds from all public market holdings, especially technology stocks, including those with the largest market capitalization, in order to fund these IPOs. "
Douglas Beath, Global Equity Strategist at the Investment Research Institute of Wells Fargo, stated that the selling behavior of retail investors before IPOs is unlikely to trigger a sustained decline in the US stock market or mark a short-term peak, but retail investors constitute; Quick Money "; An important component that may have a significant impact in the short term.
He added that the proportion of US household stock holdings to total financial assets has reached a historical high of nearly 35%, which means that amateur investors may; Sell existing positions to finance new positions; From this, it may be possible; Causing a certain degree of indigestion in the market;.
It is worth noting that the overall participation of retail investors has declined. Bloomberg industry research data shows that retail investors accounted for 17% of US stock trading volume in the first quarter of 2026, down from nearly 21% a year ago. Morgan Stanley analysts attribute this to early 2021; The frenzy of meme stocks; The long-term downward trend since the peak. However, given that SpaceX has reserved a higher proportion of shares for retail investors, analysts expect that the level of retail participation in this IPO will be higher than in the past.
