Evan Ramstad: Here's why SpaceX is 100 times more valuable than General Mills
Elon Musk's rocket company SpaceX will go public this week in what is expected to be the largest initial offering of stock ever.
Financially, the IPO also looks like one of the craziest ever.
Most companies turn to the public market when they are much smaller. But SpaceX is coming out when it has $18.7 billion in revenue, and working from that base is part of why analysts are expecting it to break records for money raised in an IPO. Even after it does, investors won't have much say in how it is run because Musk will retain 85% voting power through a second class of shares.
Despite those clear risks, SpaceX's IPO is a once-in-a-generation event, like the bet on the future of the internet that Google's IPO represented in 2004.
For SpaceX, contrary to its name, the business to pay attention to is not space but artificial intelligence. The company had plenty of capital to handle its rocket-launching business. Musk is bringing it public at a moment when AI companies are racing to build facilities and grab customers.
"They're not positioning themselves as a rocket company. They're positioning themselves as an AI company," said Gene Munster, managing partner at Deepwater Asset Management in Minneapolis.
The initial market response to the SpaceX listing may give an indication of how investors feel about direction of AI right now.
"What's most important comes down to a very simple question: Do you believe AI is going to have a significant impact on the future or a game-changing one?" Munster said.
He added that investors have already priced in the idea that AI will be significant, an improvement to existing technologies like search engines or spreadsheets.
"If in fact it changes everything," Munster said, "then there's still a lot of value to be created."
Before going further, let's do a quick Minnesota comparison.
SpaceX at the moment is just a tad larger than Minneapolis-based Ameriprise, which had $18.5 billion in 2025 revenue, and Golden Valley-based General Mills, which had $18.4 billion.
Both of those companies made several billion dollars in profit. SpaceX lost more than $4 billion.
So why are investors about to assign a valuation to SpaceX that, at $1.77 trillion, is nearly 100 times greater than our hometown heroes?
"At the most basic level, what drives the valuation of a company is its potential. It has nothing to do with what it's done in the past. It's everything to do with what's in the future," Munster explained.
"When it comes to SpaceX, they arguably have the world's most unique assets to drive long-term growth," he added. "And the market is willing to pay up in anticipation of that growth because they think the stock will go even higher."
SpaceX has an established business launching satellites and even astronauts into space, as well as running a satellite internet service called Starlink. The internet service accounted for more than half of SpaceX's revenue last year, while rocket launching provided one-fifth of it.
It's the rocket launch business that has been so astounding technologically. SpaceX changed the cost dynamics of space travel by engineering rocket stages to be re-used.
Over the last decade, the company thrilled space geeks with up-close videos of its attempts to land rocket stages back on earth, starting with targets in the ocean and then back at launchpads. It has even figured out how to grab them out of the air.
The rest of SpaceX's revenue comes from the AI startup business, called xAI, that Musk folded into SpaceX earlier this year. That business has been spending hugely to create data centers for itself and other AI firms, including some of its rivals.
The company's prospectus revealed SpaceX's capital spending was $20 billion last year (greater than its revenue!) and that xAI accounted for nearly $13 billion of that.
SpaceX is expected to raise $75 billion from the IPO, enough to pay for many more data centers, either on terra firma or in space. The need for capital to build data centers last week led Google's parent Alphabet to decide to sell $80 billion in stock.
To justify its valuation, SpaceX will need to grow at rates never seen at such a large scale. And some of Wall Street's biggest names think it can.
Goldman Sachs is projecting SpaceX revenue will reach $320 billion by 2030. And last week, the Wall Street Journal reported that a Morgan Stanley analysis shared with top investors forecast SpaceX's revenue could reach $3.4 trillion in 2040.
That's 14 years from now, but it's nearly five times larger than the revenue of America's biggest company in 2025, which was Amazon at $717 billion in revenue.
"Most investors hear those numbers and they discount them significantly," Munster said. "Why? First, it's historically been prudent to discount what Elon says. Second, the numbers are so huge they're hard to fathom."
He said the biggest challenge to SpaceX's growth will simply be logistics.
"They're talking about doing multiple launches a day, and there are so many things they can't control," he said, mentioning weather as just one of them.
"The reality of doing what they do and continuing to do it as fast as they are, that's exceptionally hard."
---
Copyright 2026 Tribune Content Agency. All Rights Reserved.
This story was originally published June 9, 2026 at 6:22 PM.