Key Highlights
- Shares of SpaceX climbed 15.8% to $133.11 following an Argus Research upgrade from “hold” to “buy” with a price target of $160
- Second quarter revenue reached $7.81 billion, representing 91.9% growth year-over-year, while losses of $0.09 per share beat consensus estimates of a $0.26 loss
- The company announced AI cloud contracts worth up to $20.8 billion, featuring a standout $6.7 billion agreement, as AI-related revenue surged to $2.56 billion
- Activity in the options market shows institutional traders selling puts while accumulating calls, indicating expectations of a potential floor in the stock price
- The initial insider lock-up period concluded with minimal selling activity, although additional unlock events are scheduled through year-end
Shares of SpaceX (SPCX) advanced 15.8% during Friday’s session, reaching an intraday peak of $133.48 before closing at $133.11, powered by an upgrade from Argus Research that shifted its rating from “hold” to “buy” and established a $160 price objective. Trading activity exceeded typical levels by approximately 110%, with roughly 237 million shares traded.
Space Exploration Technologies Corp., SPCX
The rally marks a significant turnaround for the stock, which established a fresh low point on Monday ahead of its earnings announcement and has been trapped near the $110 level since the end of July. Friday’s breakout interrupted that downward trajectory.
Two primary factors fueled the advance. The Argus upgrade coincided with the expiration of the first insider lock-up window, a milestone many market participants anticipated would unleash substantial selling pressure. That scenario failed to materialize.
The company’s quarterly financial report, issued Tuesday, exceeded expectations across key metrics. Revenue totaled $7.81 billion, marking a 91.9% increase compared to the prior year period. SpaceX reported a per-share loss of $0.09, significantly outperforming analyst projections calling for a $0.26 loss.
Massive AI Infrastructure Deals Fuel Bullish Sentiment
SpaceX announced it has locked in AI cloud infrastructure contracts valued at up to $20.8 billion during the quarter, highlighted by a single deal worth $6.7 billion. Revenue from AI operations more than tripled, climbing to approximately $2.56 billion. This expansion is reshaping analyst narratives around the business, with growing recognition of SpaceX as a diversified player spanning aerospace, global connectivity, and artificial intelligence infrastructure.
The Starlink satellite broadband service delivered impressive results as well. Subscriber counts allegedly doubled to reach 12 million users, while revenue from government agencies and commercial enterprises continued its upward trend.
Multiple Wall Street firms joined Argus in expressing confidence. Sanford C. Bernstein established a $248 price objective. JPMorgan also lifted its target. Among 40 analysts covering the stock, the consensus rating stands at “Moderate Buy” with an average price target of $227.31.
The breakdown includes two Strong Buy ratings, 25 Buy ratings, eight Hold recommendations, and five Sell ratings.
Derivatives Market Activity Points to Stabilization
Options flow on Thursday revealed a notable shift in positioning. Instead of the speculative out-of-the-money call purchases that have characterized post-IPO trading, larger institutional participants executed trades involving put sales combined with call purchases—a strategy known as a risk reversal.
One sizeable transaction involved selling $12 million worth of 90-strike puts dated June 2027, paired with the purchase of $4.3 million in 220-strike calls for the identical expiration. Another participant sold $3.5 million in 75-strike puts expiring January 2028 while acquiring $5 million in 185-strike calls. Both structures reflect confidence that downside is limited, with participation in potential rallies.
Technical indicators support improved sentiment. The 14-day RSI reached a trough late last month, while implied volatility has declined to levels not seen since June 30.
Skeptics maintain valid concerns. SpaceX recorded expenditures of approximately $18.4 billion in the most recent quarter, with $15.8 billion allocated toward AI infrastructure buildout. The business continues to generate GAAP losses, and the ambitious $16.8 billion Terafab initiative carries meaningful execution uncertainty. Additional tranches of insider shares will unlock throughout December, representing a potential supply overhang.
For the complete fiscal year, the analyst community projects SpaceX will report a per-share loss of $0.64.
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