Yesterday’s Clue…

Yesterday we told you about a mystery buyer sitting on $20 million in SpaceX calls betting on a near-triple by Friday, and the leading theory was that it was quiet insurance, not a real bet.

This morning, that insurance policy is looking less paranoid and more prophetic.

Here’s the full picture. ⇩

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One Number Changed The Entire Quarter.

SpaceX’s first earnings report as a public company checked almost every box.

Revenue reached $7.81 billion, up 92% year over year and comfortably ahead of Wall Street’s $6.82 billion estimate. AI revenue surged 247%. Starlink revenue climbed 67%. Launch revenue grew 29%. Even the net loss narrowed to $541 million.

By almost any conventional measure, it was a strong quarter.

The stock still fell as much as 12%.

The reason wasn’t hidden in the headline figures. It was buried a few pages deeper.

AI capital expenditures more than doubled—from $7.7 billion in the first quarter to $15.8 billion in the second—bringing total quarterly capital spending to $18.37 billion.

Investors didn’t hear “we grew 92%.” They heard “we’re now spending like a company that grew 900%” — and started doing uncomfortable math on free cash flow.

Turns out beating earnings and reassuring the market are two completely different jobs, and SpaceX only managed one of them.

Good News. Bad Timing.

Today’s earnings weren’t the only thing investors were pricing.

✱  Tomorrow, SpaceX’s first post-IPO lockup expires, potentially increasing the company’s tradable share count by more than 140% as insider shares become eligible for sale.

That doesn’t mean insiders will rush to sell.

It does mean the market suddenly has to consider the possibility of a much larger supply of shares—at the same time investors are already debating whether SpaceX’s accelerating AI spending will ultimately pay off.

→ Add it up: a revenue beat nobody trusts yet, a capex number that spooked the room, and a supply of fresh shares about to flood in. Even a great quarter doesn’t survive that combination unscathed.

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The company has patented a way to turn coal into five high-value commodities including diesel, hydrogen, and fertilizer without burning it. Every ton their $850 million West Virginia facility will produce is already sold, locked in under 10-year agreements before the plant is even finished. That’s contracted revenue. 

Add patents in 9 countries covering 85% of the global coal market, and there’s no one positioned to compete with them for that demand. Every piece that’s usually spotted too late is in place. 

 Frontieras just locked in its Nasdaq ticker, “FASF,” and the opportunity to invest is open.

Tomorrow’s the last day to become a Frontieras investor at the current $9.01 share price.

Disclaimer: This is a paid advertisement for Frontieras’s Regulation A offering. Please read the offering circular at https://invest.frontieras.com/. Forward looking statements were included here that the Company believes to be accurate given the current information. They involve known and unknown risks, uncertainties and other important factors which if changed may affect the outcome(s). Reservation of the ticker symbol is not a guarantee that we will be listed on the NASDAQ.  Listing on the NASDAQ is subject to approvals. Under Regulation A+, a company has the ability to change its share price by up to 20%, without requalifying the offering with the SEC.

140%↓

Every earnings reaction has one number doing the heavy lifting. This time it isn’t a revenue figure or a stock move. It’s 140% — the potential jump in tradable share supply once tomorrow’s lockup expiration hits.

That’s the number quietly explaining why bulls and bears are both technically right at the same time. The business grew. The float is about to grow faster. Two true things pulling in opposite directions is exactly the kind of stock that makes everyone a little too confident in their own read.

Four Opinions.

Analysts walked away from SpaceX’s first earnings report with one clear takeaway: the quarter was strong.

What they couldn’t agree on was what the company is worth.

→ Bank of America reiterated its Buy rating with a $235 price target, saying it had become even more positive on SpaceX’s positioning.
→ JPMorgan raised its target to $240, pointing to management’s goal of reaching a $100 billion AI annual revenue run rate by the end of 2026 and $1 trillion in total revenue by 2030.

Not everyone shared that optimism.

→ Wells Fargo trimmed its target to $215, while keeping an Overweight rating.
→ Piper Sandler cut its target to $140, citing the prospect of $65 billion in 2027 capital spending and the fact that many of SpaceX’s AI cloud contracts remain cancelable.

That’s a $100 gap in price targets—on the same earnings report.

Meanwhile, the broader space sector barely reacted. Rocket Lab fell roughly 1%, while most peers finished down only low single digits.

The Rest of The Sector Barely Flinched. 

SpaceX’s selloff didn’t spread across the rest of the sector.

While SpaceX fell more than 8%, Rocket Lab, AST SpaceMobile, Virgin Galactic, Planet Labs, Intuitive Machines, and the Procure Space ETF all finished down less than 5%.

That divergence suggests investors were reacting to company-specific issues—namely SpaceX’s accelerating AI investment and tomorrow’s lockup expiration—rather than reassessing the space industry as a whole.

Polymarket still places a 57.5% probability on SpaceX closing above $100 by the end of August, a reminder that traders remain divided on whether today’s selloff marks a lasting shift or simply a short-term reaction.

The Debate.

Nobody is questioning whether SpaceX is growing.

The debate is whether today’s extraordinary investment eventually produces extraordinary returns—and whether Starlink, now with more than 12 million subscribers and still the company’s primary source of profitability, can support that investment while the rest of the business continues to scale.

✱ Tomorrow brings the next test.

Lesson Of The Day:

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