Short bets on SpaceX climb to 32% of float as Musk pushes back

Short sellers are building a larger bet against SpaceX just as the newly public company heads toward its first earnings report. For everyday investors, the key issue is pressure: a heavily shorted stock can move sharply if results, insider-share unlocks or investor sentiment force either side to adjust fast.

About 206 million SpaceX shares have been sold short, equal to roughly 32% of the company’s public float, according to estimates from S3 Partners cited by CNBC. The public float means shares that can trade freely in the market, excluding stock that is restricted or closely held.

S3 estimated the short position at about $25 billion in notional bearish bets. A short sale is a wager that a stock will fall: an investor borrows shares, sells them, and hopes to buy them back later at a lower price. If the stock rises instead, losses can grow because the investor still has to return the borrowed shares.

The short interest has climbed quickly. CNBC reported that S3 estimated roughly 185 million SpaceX shares, or 29% of the float, were sold short last week. About a month ago, S3 estimated the bearish position at around 40 million shares, equal to roughly 5% to 7% of the float.

Matthew Unterman, head of research at S3, told CNBC that short sellers are adding exposure before several events that could move the stock, including SpaceX’s first public-company earnings report and later lock-up expirations. A lock-up is a restriction that keeps certain shareholders, often insiders or early investors, from selling for a set period after an initial public offering.

Elon Musk responded on X to the growing short interest, writing that firms holding a large short position in SpaceX over time have a “very low” probability of survival. He also wrote that SpaceX would be worth more than Earth if it achieves its goals, calling that “obviously true.”

SpaceX confirmed Tuesday that it plans to report quarterly results after U.S. markets close on Aug. 4, according to CNBC. That report will be the first detailed look investors get at the company’s financial performance since its IPO.

The setup puts several debates in one place. CNBC reported that bullish investors point to SpaceX’s position in launch services, the growth of Starlink and the company’s artificial intelligence ambitions. Skeptics are focused on valuation and whether the stock already prices in too much of that future growth.

SpaceX shares rose about 7% Tuesday to around $128, CNBC reported, putting the stock on track to end a seven-session losing streak. The move followed Macquarie analysts reiterating an outperform rating and encouraging investors to buy the recent weakness, according to CNBC.

Even with Tuesday’s gain, CNBC reported that the stock remained below its $135 IPO price after a post-listing pullback. That gap matters for sentiment because it shows the market is still deciding how to value SpaceX as a public company, especially with earnings and potential new share supply approaching.

This story draws on original reporting from CNBC.