SpaceX’s $1.75T IPO Unlocks Up to $100B for Alphabet
GOOG•Alphabet’s $900 million investment in SpaceX in 2015 now translates into a 5–6% stake valued at roughly $87–$100 billion after the IPO pricing. The offering’s $135-per-share pricing targets a $75 billion raise at a $1.75 trillion valuation and provides Alphabet a direct path to convert paper gains to cash.
1. IPO Pricing and Scale
The SpaceX IPO is set at $135 per share, targeting a $75 billion capital raise and valuing the company at approximately $1.75 trillion. This makes it the largest initial offering in history with order books peaking near $150 billion before closing.
2. Evolution of Alphabet’s Stake
Alphabet invested about $900 million in SpaceX in 2015, accumulating a 6.11% holding before SpaceX’s merger with xAI. That transaction increased the share count, trimming Alphabet’s stake to roughly 5% but maintaining its economic interest.
3. Realizing Paper Gains
At the IPO price, Alphabet’s reduced stake is worth between $87 billion and $100 billion, representing more than a 100× paper gain. SpaceX reserved 5% of shares for a direct share program, allowing selected buyers to bypass the lockup and provide near-term liquidity.
4. Strategic AI Computing Contracts
Alphabet also agreed to pay $920 million per month for AI computing power through June 2029, a deal worth about $30 billion. This commitment, alongside Anthropic’s $1.25 billion monthly contract, secures demand for Google’s AI hardware and strengthens long-term revenue streams.
