Although mainstream media covered insiders’ massive unlock of 911.5 million SpaceX shares worth $101 billion on August 6, very few people realize that an additional unlock on that date failed because SpaceX’s stock price had crashed so badly.
That second, bonus tranche of 455.8 million shares required SpaceX to close at or above $175.50 per share, i.e. 30% above the formal $135 IPO price, for at least five of 10 trading days leading into its August 4 earnings report.
SpaceX held nowhere close to that threshold in Nasdaq trading. The condition failed.
The market capitalization of SpaceX was only able to reach its momentary, $3 trillion peak because Elon Musk floated only a tiny quantity of shares in the IPO.
Artificially limiting supply far below demand for his popular company created a three-day surge from $150 to $225.64 per share.
That was the peak. A swift retracement followed once investors started to prepare for insiders to unlock and sell their allocations.
SpaceX insiders fail to unlock 455.8 million shares
By the first unlock on August 6, SpaceX had declined 38% from its peak.
On that day, 911.5 million more shares came out of lockup. The supply increased by $101 billion of newly tradable stock, yet almost nobody asked why an additional tranche of 455.8 million shares stayed locked.
The answer, per SpaceX’s own prospectus, is that Musk’s stock crashed so badly.
Because the company failed to maintain a trading range at least 30% above the $135 IPO price within the 10 trading days prior to its inaugural earnings report, the bonus stayed locked.
It was nowhere close. Of all 10 closing prices within the trading window, zero cleared $175.50. The best of them, $125.33 on earnings day itself, missed the bar by an embarrassing 29%.
The earnings report wasn’t the problem. Revenue nearly doubled, and finance chief Bret Johnsen said “2026 has been a momentous year so far, and the second quarter demonstrated the true power of SpaceX.”
Read more: Some SpaceX bonds have already sunk to junk-like territory
Elon Musk blames short-sellers
Protos has chronicled the slide in SpaceX shares since last month, including analyst research coverage by its IPO-underwriting banks that invariably rated it “Buy.”
Despite their glowing, self-interested forecasts, the stock fell 53% from its June 16 peak to an all-time low of $104.83 by August 3.
Skeptical short-sellers had amassed a roughly $25 billion position by late July, about a third of the float. Enraged, Musk posted, “The survival probability of firms who maintain a significant short position in SpaceX over time is very low.”
The stock printed its all-time low less than three weeks after Musk posted.
Musk had no stake in these particular deadline either way. His 6.4 billion shares remain locked until June 2027, and no performance trigger can release them early.
The market, for its part, shrugged off the unlock that did happen. SPCX climbed 3% by late morning on unlock day and ended the session up 6%. The next day, it added another 16%.
By Monday, it had closed back above its $135 IPO price for the first time since mid-July.
The rebound arrived four trading days after it could no longer help unlock insiders’ 455.8 million restricted shares.
At $175.50 per share, this bonus tranche that never unlocked was worth about $80 billion — and now cannot be sold. Quite the missed payday.
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