SpaceX stock plunges over 12% after quarterly results reveal massive AI investment

SpaceX experienced a significant market correction, with its stock falling more than 12% on Nasdaq shortly after releasing its inaugural quarterly earnings report. The sharp decline erased an estimated $200 billion from the company's market capitalization, with shares trading at $110.00 around 10:35 AM Argentina time.

The company's financial disclosures revealed a sixfold increase in capital expenditures, reaching $18.4 billion. This substantial investment was primarily directed towards developing artificial intelligence infrastructure, a move that appears to have heightened investor caution regarding the massive spending by major tech firms in the AI race.

This drop saw SpaceX shares fall below the $135 price set during its initial public offering (IPO) on June 12. However, the stock showed signs of recovery later in the day, rebounding by 2% to trade at $110.00. This rebound suggests continued market interest, potentially bolstered by the company's solid second-quarter financial results.

SpaceX reported impressive second-quarter revenues of $7.81 billion, surpassing analyst expectations. The company also noted notable growth in its AI and connectivity segments, indicating underlying strength despite the market's initial reaction to its increased spending.