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Starlink IPO: "False" Elon Musk Says on X

By:Thomas Westwater

Is a Starlink IPO coming soon? Not so fast, says Elon Musk.

  • Elon Musk says “false” to Starlink IPO news on X.
  • Market attention continues to orbit potential listing.
  • When can we expect a Starlink IPO: 2024 or 2025?

Elon Musk, on Wednesday, said that it was “false” that his company, SpaceX, was in discussions to take the company’s satellite business, Starlink, public through an initial public offering (IPO). 

Musk made the one-word statement in a post on X, formerly Twitter, in response to a Bloomberg report. The report cited “people with knowledge of the matter.” 

Bloomberg stated that SpaceX has moved assets in its satellite segment to a wholly owned subsidiary. However, the report did concede that no decisions have been made and that it was also possible that an IPO wouldn’t happen.

As of Thursday afternoon, SpaceX hasn’t provided an official response. Musk has previously hinted at taking Starlink public, stating in 2021 that the satellite-based internet service would go public once issues around cash flows were more predictable.

How does Starlink make its money?

Starlink is likely SpaceX’s most profitable segment, with nearly $15 billion in sales expected in 2024, according to a separate Bloomberg report. The company’s coverage area has expanded dramatically over the past year and should make up a large chunk of its revenue stream.

Through a constellation of low-Earth orbit (LEO) satellites, Starlink provides high-speed internet for a monthly charge in addition to an upfront hardware fee. The coverage area’s expansion has increased its consumer base, and some analysts predict that it could generate revenue north of $30 billion per year.

Currently, Starlink has around 5,000 LEO satellites, with plans to reach about 12,000 in the coming years and a possible end-count of nearly 45,000. According to SpaceX earlier this year, Starlink has over two million users.

While that has fallen short of recent projections, analysts remain bullish on the company’s future. Just this week, Starlink secured a contract to offer Mexico free internet through 2026.

There are undoubtedly more deals to come for the world’s largest satellite operator. And with a controlling lead over rivals, some backed by powerhouses such as Amazon, Starlink remains in control of the narrative with a commanding lead.

When can we expect an IPO? 

2024 might be premature to expect an IPO for Starlink. 2025, or perhaps 2026, are more likely as of now. If things continue to go well for the internet satellite business, the chances will likely shift to sooner rather than later.

Gwynne Shotwell, SpaceX president and chief operating officer, said earlier this year that Starlink had a cash flow positive quarter. If the company makes successive quarterly profits, that may encourage more serious discussion around an offering, perhaps as soon as early next year.

Of course, market conditions may also play a role. IPOs haven’t done so hot this year, but that hasn’t stopped companies from considering listings. Regardless, all eyes remain on Musk for clues.

Thomas Westwater, a tastylive financial writer and analyst, has eight years of markets and trading experience. @fxwestwater

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