SpaceX is considering going public in 2026, with management targeting a valuation of $1.5 trillion for the initial public offering. This potential move follows a recent private funding round that valued the entire company at $800 billion.
Alphabet owns approximately a 7% stake in SpaceX. The company invested around $900 million for this stake in 2015. At that time, it was unclear whether SpaceX would succeed as an investment over the following decade.
SpaceX has since conducted hundreds of successful rocket launches. The company developed a system to land and reuse its rocket booster stages. Its Starlink satellite internet and broadband business has become a significant recurring revenue source.
If the market values SpaceX at $1.5 trillion, Alphabet's 7% stake would be worth approximately $105 billion. Alphabet could choose to sell that stock on the open market. The proceeds could support the company's generative AI buildout, as data center construction costs are high.
An IPO of this size is nearly unprecedented. It could test how public markets respond to such a large new entrant. If profitable, SpaceX could be included in the S&P 500 index.
Alphabet's investment portfolio includes several large stakes in other businesses. Most do not attract significant attention compared to its primary operations. The SpaceX investment is one that could yield tens of billions of dollars.