SpaceX is worth $1.5 trillion, possibly $1.75 trillion. If its forthcoming IPO proceeds at that range, it will be the largest public offering in history—by a wide margin. Nobody seriously disputes that SpaceX is a great company. The question is whether it is a $1.5 trillion company, and whether investors have properly accounted for the fat-tailed risks lurking beneath the excitement.

Begin with a DuPont-style decomposition. The classic DuPont framework breaks return on equity into margin, asset turnover, and leverage—three legs that must each justify the whole. We lack a balance sheet for SpaceX, but the same discipline applies to its revenue multiple: break it into its mechanical parts and see what each component must deliver. PitchBook estimates SpaceX generated roughly $16 billion in revenue and $7.5 billion in EBITDA in 2025. A $1.5 trillion valuation therefore implies a revenue multiple of approximately 94 times. Decompose that further. The revenue multiple is, at its core, the product of a profit margin assumption and a price-to-earnings assumption. If we grant SpaceX a generous 30 percent net margin at maturity—higher than almost any infrastructure business in history—the implied price-to-earnings ratio is still above 310. Grant 40 percent, an almost fantastical margin achievable perhaps only by a monopoly utility in space, and you are still paying 235 times earnings. The decomposition reveals what narrative obscures: every leg of the decomposition must hit an extreme simultaneously for the price to hold. Margin, turnover, and growth cannot merely be good. They must each be historically unprecedented, and they must all arrive on schedule.

Starlink, the satellite internet constellation, carries the heaviest load. It generates over two-thirds of revenue at a 50-plus percent EBITDA margin and is the only segment with a clear path to the kind of scale the valuation demands. The $19.6 billion EchoStar spectrum acquisition—a sum exceeding full-year 2025 revenue—is a bet that direct-to-cell satellite broadband will open an entirely new........

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