By Corrie Driebusch
SpaceX has created a space-based internet that connects the world, is developing data centers that will harness the Sun to power a truth-seeking AI, and hopes to bring manufacturing to the Moon and civilization to other planets.
To sell shares in what is expected to be the largest initial public offering ever, however, it will rely on a surprisingly low-tech, incredibly manual process.
Bankers will make phone calls to feverishly allocate some $80 billion worth of shares and pair buyers and sellers. It's a process that hasn't fundamentally changed since the IPO boom of the 1980s. They do this even for the biggest, most-technologically savvy companies heading to the public markets. OpenAI is preparing to file confidentially for an IPO in the coming days, and Anthropic is also eyeing a market debut later this year.
Over the next 21 days, SpaceX and the 23 investment banks working as its underwriters face the unprecedented task of assigning value to a company whose mission is "to extend the light of consciousness to the stars," divvying out shares to actual humans and then making sure the shares don't crash to earth on the first day of trading.
Nasdaq is expected to practice with mock openings to make sure its technology platform is prepared for the big expected volumes. Anticipated for June 12, the IPO will be so big that SpaceX shares aren't expected to even open for trading until hours after the 9:30 opening bell.
Coming up with a price
For months, SpaceX has been courting the world's largest money managers. In April, more than 100 fund managers schlepped to Newark and boarded a chartered 737 jet with SpaceX's logo on the tail. Their destination: Starbase, Texas, the company town where SpaceX's Starship spacecraft and rocket boosters are made.
The investors got a tour of the "Starfactory" where employees produce the massive vehicles. SpaceX President Gwynne Shotwell and CFO Bret Johnsen presented, and Elon Musk himself took questions from the audience. His answers, according to people in attendance, were "aspirational," focusing on the "art of the possible" including lunar manufacturing and harnessing the power of the sun.
The investor group continued on to Memphis to tour xAI data-center facilities. Many investors left the trip excited but questioning how SpaceX's financials could justify such a large rumored valuation.
Now they have their answer. On the one hand, SpaceX's regulatory filing on Wednesday showed an established satellite internet business, which generated more than $11 billion in revenue last year, as well as more than $4 billion in revenue from its space business, which sends satellites and astronauts to space. But its losses are growing. In 2025, SpaceX posted a net loss of nearly $4.9 billion, and those losses are accelerating into 2026.
By about June 4, SpaceX is expected to update its paperwork with the Securities and Exchange Commission to include a price range for which it expects to sell its stock in its IPO.
Lots of rejection
It may be called an initial public offering, but in the case of a hot IPO, there's a lot of rejection. Many investors don't get the shares they want.
In SpaceX's case, the bankers on the deal, led by Goldman Sachs along with Morgan Stanley, and together with the company pick which investors may buy shares and who walks away empty-handed.
Investors, for their part, know they are unlikely to get all the shares they ask for in the IPO, so traditionally they inflate the number they want. Some prospective investors started telling SpaceX and its underwriters how much stock they were willing to buy weeks ago -- before seeing the company's financials and disclosures. Many promised to pony up billions.
When AI chip maker Cerebras went public earlier this month, a third of investors who put in buy orders got nothing, according to people familiar with the matter. Almost everyone else got a fraction of what they asked for, the people said.
The afternoon before SpaceX's stock market debut, the board, executives and top bankers will hold a closed-door meeting. There the group picks the company's book of investors. There's no automated formula for allocating IPO shares, bankers say. The process still depends on decades of experience assessing which investors are reliable long-term holders and which are merely claiming they won't quickly sell after the IPO.
The group reviews the order book line by line in an allocation process that can stretch for hours. One banker who has worked hundreds of deals said he tends to group orders based on whether he believes the investor is likely to hold on to the stock long term or whether they're likely to flip and take profits day one.
In large offerings, there can be hundreds of lines of orders to sift through.
To capitalize on Musk's popularity with individual investors at his other company Tesla, SpaceX is considering selling a large percentage of its IPO shares to individual investors compared with the sub-10% typical of most IPOs. It could generate the biggest order book in history, some bankers say.
Wall Street attempts to modernize how to sell an IPO have never stuck. In 2004, Google famously tried a Dutch auction as a way to push back against what it viewed as the clubby world of bankers allocating stock to the largest institutions and wealthiest clients.
There wasn't enough demand, however, and Google had to lower its offering range and reduce the number of shares it was offering. The stock priced at $85, far below the company's original goal. Though shares traded higher on their first day of trading -- and have risen meteorically since -- Wall Street scoffed at the attempted modernization.
Late on opening day
On the morning of the SpaceX IPO, starting around 7 a.m. ET, underwriters will pick up their phones and start dialing investors to tell them how many shares they've been allocated to buy.
The calls -- rarely anything automated like an email -- help their relationships with investor clients, underwriters say. Anyone who fails to answer the call or confirm an order risks losing their shares.
It actually can take hours for a newly public company's stock to trade.
That's because everyone who purchased shares has a choice to make: Buy more, sell some or hold. For everyone else in the broader investing world, the choice is simple: Buy or do nothing.
And on day one of trading, the most important person for the stock is the lead trader at the underwriting bank that was selected as the stabilization agent.
For SpaceX, that role falls to John Paci at Morgan Stanley. The former NFL quarterback from Long Island, N.Y., has helped open the stock for Airbnb , Uber and Rivian, among other big names. SpaceX will be his biggest test.
Paci was a backup quarterback for the New York Jets and cuts an imposing figure at 6'4." He sits -- or more often on opening days, stands -- in the middle of Morgan Stanley's equity trading floor calling out to dozens of sales traders the price a stock is on track to open at. He has a turret phone system that allows him to have multiple open phone lines, and it's not uncommon for Paci to juggle three sets at once.
The stabilization agent's computer screen will display a ledger of buy-and-sell orders, and it frequently updates to show if the IPO were to open at that very moment what the price would be, the number of paired shares at that price, and the order imbalance. The stabilization agent still has manual control, testing how many shares could move the opening price by a dollar or two in either direction.
As the stabilization agent, when he's satisfied with the price, Paci will decide to open SpaceX.
In the past several years, big, buzzy IPOs have opened later and later in the trading day. In 2014, shares of Alibaba, the largest IPO in the U.S. until SpaceX, started trading a little before noon ET. Last year, shares of software maker Figma opened just before 2 p.m. ET and traded for just two hours before the market closed. Huge demand, including a flood of orders from individual investors, that sent the stock soaring contributed to the delay.
Stabilization agents tend to want to match buyers and sellers for around 10% of an IPO before they open the stock. For SpaceX, that will be billions of dollars worth of shares and could take many hours, some bankers say.
Trading stumbles
An IPO that was similar in hype to SpaceX was Facebook. The social network's 2012 stock-market debut, however, turned into a fiasco.
Nasdaq had begun accepting orders before trading began, but when investors tried to change the price or size or cancel their orders, some didn't get a confirmation due to a Nasdaq technology malfunction. It caused mass confusion.
Facebook stock started dropping. Its stabilization agent -- Morgan Stanley's Paci -- stepped in to try to prop it up with what is colloquially referred to as the "green shoe option," which allows bankers to buy additional shares to help stabilize a share price.
Nasdaq has overhauled its IPO process and modernized its technology since then.
Ahead of Uber's 2019 IPO, the New York Stock Exchange conducted simulated trading tests over the weekend to try to avoid any technological glitches. In mock IPOs, brokers submitted fake orders to ensure exchange systems could handle immense volume.
For SpaceX, the technology may hold -- and a lot could still go wrong. Investors could choose to flip their stock for a quick profit, sending shares quickly below the opening price. SpaceX is expected to attract a lot of individual investors, and lately they have been "momentum" traders, underwriters say. This works in a stock's favor if the share price is rising; it can also quickly backfire if the stock price begins to fall.
There are also thousands of people who hold exposure to SpaceX via special-purpose vehicles, or SPVs. Some bankers say they are concerned that this could pressure SpaceX's stock in early trading.
While pre-IPO investors must sign lockup agreements ahead of the offering, promising to hold on to their shares, individuals who own exposure via SPVs often don't. They could try to hedge their paper gains via options contracts or by trying to short the stock.
In an ideal world, many CEOs and bankers say they want to see at least a 20% pop in share price on day one.
The pressure may be even greater at SpaceX, where Musk stands to become the world's first trillionaire on the IPO and isn't shy at calling out any problems publicly.
Write to Corrie Driebusch at corrie.driebusch@wsj.com
(END) Dow Jones Newswires
May 22, 2026 21:00 ET (01:00 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
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