SpaceX IPO on ice as Musk weighs folding Tesla, Starlink, and xAI into one public company
The slight earnings beat didn't convince investors that all is well with Elon Musk's car company, and Tesla's stock slumped after the announcement under relentless selling pressure.
Elon's efforts to reposition Tesla as a "physical AI" company feeding on autonomous driving subscriptions, robotaxis, and Optimus humanoids instead of car sales contrasted with the announcement that Tesla can't compete in the premium EV segment and is nixing the Model X and Model S while mulling what to do with the Cybertruck.
SpaceX may merge with Tesla instead of June IPO
After the Tesla stock rout, today's piece of news may pump the share price in the opposite direction, though, as both Bloomberg and Reuters are reporting that Elon Musk is considering making Tesla, SpaceX, and xAI one company. He's reportedly mulling a SpaceX merger with xAI via a stock exchange, with a number of potential synergies like orbital data centers, and simply folding SpaceX into Tesla instead of filing for a separate IPO.
This would be a welcome move considering that SpaceX is rumored to file for a $50 billion IPO at a $1.5 trillion valuation and would turn the Tesla stock into a space, AI, and robotics company instead of an automaker, with the respective forward-looking valuation. It would also drown out the current negative pressure that stems from falling profits and lack of growth prospects. While Tesla has a lead in autonomous vehicles and humanoid robots, competition is growing, and Elon's lofty growth ambitions may not pan out in a few years, as so often happens.
A merger of SpaceX with Tesla, and xAI as a bonus, could certainly remedy that. Alternatively, this could be just a deliberate rumor, yet legal entity filings by the SpaceX CFO in Nevada that read "merger sub" in the title might be a telltale sign that Elon might be at least considering how to fold SpaceX, Tesla, and xAI into one publicly traded company.
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