SpaceX Said to Pursue 2026 IPO Raising Far Above $30 Billion

0:00Carol Massar:They told us to expect change. They warned us about the transition. But honestly, they forgot the best part. This is the chapter where we finally focus on us. LifeMD delivers expert menopause and midlife care right from your home. From hormone health to holistic wellness, LifeMD helps you feel your best for the best years of your life. LifeMD, it's just getting good. Visit LifeMD.com slash goodlife. The thing about AI for business, it may not automatically fit the way your business works. At IBM, we've seen this firsthand. But by embedding AI across HR, IT, and procurement processes, we've reduced costs by millions, slash repetitive tasks, and freed thousands of hours for strategic work.

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2:40Carol Massar:Podcasts. Radio. News. This is Bloomberg Business Week Daily. Reporting from the magazine that helps global leaders stay ahead. With insight on the people, companies, and trends shaping today's complex economy. Plus global business, finance and tech news as it happens. The Bloomberg Business Week Daily podcast with Carol Masser and Tim Stenevek on Bloomberg Radio. Well, now to our most read story on the Bloomberg terminal in the last hour. SpaceX moving ahead with plans for an IPO that would seek to raise significantly more than$30 billion. People familiar with the matter said in a transaction that would make it the biggest listing of all time.

3:22That Bloomberg exclusive by Ed Ludlow and Eric Johnson. Eric Johnson is with us. He's Bloomberg News team leader for space aviation and defense. He's also global business of space editor. He joins us here in the Bloomberg Interactive Brokers studio, usually based in Seattle. We're lucky that you're here today in New York. Congratulations on this scoop. What did you and Ed find? Well, basically, the SpaceX management and advisors are are moving forward with plans for for an IPO targeting next year, mid to late next year. timing could slip to 2027 of course as they go forward with these plans but um if they do it would eclipse the 2019 record set by saudi aramco um raising you know more than far above significantly more than according to some of the people the 30 billion dollars you know uh in previous years eric we've talked about the idea of spacex potentially spinning off starlink carol's been a long time starlink subscriber fair to say right yeah yeah you've known it's really cool um i just experienced it for the first time recently.

4:24Where do you use it, by the way?

4:25Carol Massar:On a boat. Oh, very nice. How does it work? Is it good? It's fabulous. And what's interesting, because you go to a lot of arenas and the Wi-Fi is not usually very, very good. And even though they try to create systems and so forth, it's incredible. But you could stream us on YouTube on Starlink. Yeah. And it's just fascinating. You see the dish move as, you know, it's just, it's pretty cool. So is the is the iteration of SpaceX's IPO that you and Ed write about, does that include, excuse me, yeah, does that include Starlink? This is for the entire company. Is there not talk about spinning it off anymore?

4:58As you pointed out, over the years, SpaceX executives have talked about an IPO. And the idea was, is that, you know, as they become cashflow positive, they could spin off Starlink as its own IPO. It's more of a consumer tech play. But the plans have changed. And if you if you look at the growth of spacex yeah and you look at not just becoming the most prolific launch rocket launch company on earth but now they've got plans for their gigantic starship which is you know they're developing to take humans back to the moon at some point and eventually if you believe musk mars will have a mars colony at some point um but you think about that and i shouldn't laugh and and then you think about starlink which which you brought up i mean now they've got millions of subscribers.

5:45They're operating the largest satellite network in low Earth orbit. So all of these factors are coming together to portray a company from a position of strength and growth. And look, Musk, so many people believe in Musk. He's got plenty of detractors, plenty of naysayers, but many people wouldn't want to bet against him. And you're seeing some of that momentum.

6:07Carol Massar:Well, when I think about Starlink, too, I think, wait, is this going to replace like our internet providers eventually for our home? Like, I mean, how far can this go? And is that part of the plan? That's the key question. If you think about capacity. So for a while, Starlink wasn't good at operating in areas where there's fiber optic cable, for instance. They can't compete with that. It takes longer for data to move through space than cable. But as they got more and more satellites, they're getting better and better. So you're starting to see their service improve. and one quick funny story if you'll bear with me is I was on an Alaska Airlines flight here and Ben Minacucci the CEO of Alaska was happened to be on the plane nice and the internet was going in and out of course and he comes rushing up the aisle and and grabs one of the flight attendants and says you know you reset it and he's having this conversation and then we happen to have Bloomberg and Ed board with him the next day at a conference so I said to him I said I relayed this and i was like listen you know what was your what were you thinking it's going on he goes i'm i can't wait for starlink and so they're one of their customers so airlines are starting to bet on this yeah i mean i've told this story 10 times already today you've talked about united i took my first united flight with it last weekend and it was it was totally game-changing united it's going to have it by the end of this year on all their um small two cabin like regional jets so the smaller ones but it was it was completely game-changing uh eric before we we let you go the other companies that compete in the space, not in the delivering internet from space, but in the actual rocket launching, like a Rocket Lab USA, for example.

7:42How are they doing right now against SpaceX? Our story sent their shares higher after the news of the IPO plans came out. But Rocket Lab is a formidable challenger. They're doing really well. There's companies like Firefly. There's a host of companies around the world that are trying to challenge Musk and try to rise up against SpaceX, but right now they're the dominant player.

8:06Carol Massar:All right, can I just say, though, I mean,$30 billion,$1.5 trillion, we're talking about a valuation, it could be even more, couldn't it? Could be a very good point. It could be even more. There's got to be, it's a long process. It's worth mentioning. They're in the beginning stages of this, and so you've got to do a roadshow. You've got to get the banks globally. You've got to get the banks involved, and absolutely, it could be significantly higher. I think it's safe to say the banks are going to be clamoring for this, right? I mean, we haven't seen one of this size in a long time. All right.

8:34Carol Massar:All right. You know, the understatement of the day. The banks, the lawyers, the advisors. Yeah, we're going to see the names. We'll see the names associated. Congratulations. A Bloomberg scoop. Really well done. And to Ed Ludlow, too. Both of you guys. Killer. Eric Johnson, Bloomberg News team leader for space, aviation, and defense. He's also the global business of space editor. Sign up for that newsletter. You can do that at Bloomberg.com. Joining us here in the Bloomberg Interactive Broker Studio. Stay with us. More from Bloomberg Businessweek Daily coming up after this.

9:07Carol Massar:They told us to expect change. They warned us about the transition. But honestly, they forgot the best part. This is the chapter where we finally focus on us. LifeMD delivers expert menopause and midlife care right from your home. From hormone health to holistic wellness, LifeMD helps you feel your best for the best years of your life. LifeMD, it's just getting good. Visit LifeMD.com slash goodlife. The thing about AI for business, it may not automatically fit the way your business works. At IBM, we've seen this firsthand. But by embedding AI across HR, IT, and procurement processes, we've reduced costs by millions, slash repetitive tasks and freed thousands of hours for strategic work.

9:57Now we're helping companies get smarter by putting AI where it actually pays off, deep in the work that moves the business. Let's create smarter business, IBM. For many men, mental health challenges aren't recognized until they've already taken a toll. Work pressure, financial stress, changing relationships, and traditional expectations around masculinity can quietly wear men down, often without clear warning signs. In Season 3 of The Visibility Gap, Dr. Guy Winch and his guests explore how these pressures show up, how to spot them earlier, and how men can access meaningful support. Listen to the new season of The Visibility Gap, a podcast presented by Cigna Healthcare.

10:37Carol Massar:You need to make a huge presentation in an hour. Adobe Acrobat uses AI to take all your documents and generate a presentation with a single click. Build slides quickly and streamline the process. Need a last-minute pitch deck? Do that with Acrobat. Need to level up your presentation design? Do that with Acrobat. You have 30-plus documents that need to be simplified into a proposal. Do that. Do that. Do that with Acrobat. Learn more at adobe.com slash do that with Acrobat. You're listening to the Bloomberg Business Week Daily Podcast. Catch us live weekday afternoons from 2 to 5 Eastern. Listen on Apple CarPlay and Android Auto with the Bloomberg Business app.

11:22Carol Massar:Or watch us live on YouTube. We're going to now talk about the trade in multi-assets. Man, to the head of multi-asset solutions at VanEck Funds, David Schastler joins us. VanEck has approximately$162 billion in assets under management. David joins us right here in New York City. The Fed decision, the commentary. In your view, what's going to affect the financial market trade the most? We are thematic investors. So I'm going to talk big picture and then we can kind of narrow it down. So you've got three things happen, right? So think about it this way. You've got three basically mega themes crashing together at the same time, right?

11:57First one is clearly disruptive innovation. Yes, we're talking about AI, robotics, everything that, right? But in addition, you've got old world assets building new world, right? None of that happens without infrastructure development, raw assets, real assets. We're in a stealth bull market, real assets. And then third, we're in the debasement era, you know, and that's going to lead to more liquidity. Now we're talking about I know you guys were talking before this about rate cuts. Another 25 basis points all moving towards and validating the thesis of the debasement era where liquidity is going to get easier out of necessity.

12:30So that's that's where we think we're going. And it completely changes the landscape from a national allocation perspective.

12:35Carol Massar:Okay, so what are you, you know, I just talked to our team and asked them, Michael McKenzie, Stuart Paul, who watch the U.S. economy, they watch the rates market, kind of what they are queuing up for when it comes to Jay Powell tomorrow. They're going to watch what he says about the U.S. labor market. What is top of mind for you in terms of what could indeed impact the investment environment over the next six to 12 months? Or is it too really to even think about that, considering Jay Powell is likely to leave the Fed next year when his term is up and we get some new individuals on the U.S. Central Bank.

13:14Yeah. So listen, Jay Powell, the attack of the central bank, their independence, him getting replaced, all that's happening, right? Who's he going to get replaced with? All that's happening right now. The key is what's going to happen in the markets. AI, let's kind of go back to that, because that's what's clearly going to drive markets. That's where the growth is, right? That's the focus. I think about AI in three phases. So that's how we frame it up. The first was the build. That's clearly where we spent the last two years, where anything attached to AI, billions of dollars in spend, all that was benefited.

13:49That's where the scarcity was. That's where the compute was. That's where the energy was. Then we moved to phase two. Investors are looking at it and saying, well, how do we get paid back? You spend billions of dollars. Well, how do we get ours? And that's when we start asking questions like that. There's going to be a disconnect between hype and expectations and the reality. Make no mistake about it. We're of the camp that AI is going to over deliver and that it's not under hype long term. But there's going to be a mismatch and that mismatch is going to cause volatility. Well, what is the volatility?

14:19I just want to jump in because the over delivering on AI, I think the concern a lot of people have is what's the fundamental change that it makes to our economy? The idea that workers should be very worried about their jobs, because that's the promise that AI has, an increase in productivity, an increase in productivity because this technology can do what human beings do. How do you look at that and the effect of that on the economy and the markets? I think about it a little bit differently. So there's no doubt that there's going to be replacement. And the next few years are going to be particularly bizarre and uncomfortable for many.

14:52Because where AI can replace, it's already replacing. So you see that in new college graduates. Anybody doing repetitive tasks where they're putting their head down and they're pushing computer keys, be concerned. Think about expanding your skill set. At the end of the day, AI, which think about it as the brain, is going to combine with the body, which is robotics, to drive massive innovation, massive productivity gains, ultimately massive growth across the entire labor force. That's the setup. So you end up in a period of an abundance where you get better lives, higher quality of lives, longer lives, all that coming eventually.

15:27But the idea is really simply is that human beings engage with this technology, as we have with every previous technological advancement as it relates to general purpose technologies to make things better. Well, and that's the core assumption here.

15:39Carol Massar:So, David, you know, the MAG-7, the Bloomberg MAG-7 total return index up 25 percent year to date, dropped more than 8 percent from late October to November 20th. And it's down about 2 percent since late October. The group has been definitely bouncing around as people question some of the spend by those hyperscalers that make up many of the names within the MAG-7. Is big tech, in your view, a buy, sell or hold at this point? It's a hold. And there's going to be more compelling opportunities as volatility is introduced, as people question the spend and the productivity payout. So in a very short period of time, unfortunately, I would say sell.

16:14But the reality is I would hold and buy into dips because we're not entering this overexposed from our side. And that's the key is not being overexposed. This technology cycle has long legs. Yeah. It's going to touch lots of things. It's going to require lots of old world assets. There's a stealth bull market going on in real assets right now as well. Natural resource equities are up more than the Qs this year. People aren't talking about that. How are we going to pay for this?

16:36Carol Massar:Well, 30 seconds. You have a favorite asset class. I mean, gold has soared this year. Bitcoin has bounced around. That's kind of the two extremes when you think about kind of the investment environment with a lot of stuff, including private markets and everything in the middle of that. So favorite asset just got about 25 seconds. Bitcoin's a top performer by the end of the year, down 30 percent. mismatched off the queues by about 50 % this year, followed by gold. Gold will hit$5 ,000, we think, sometime in 2026. By weakness in technology, we're in a long-term innovation cycle. Cool stuff. Fun to have you.

17:08Carol Massar:All right, we got some calls. There it is. We'll have you back. We will in 2026. David Schastler, head of multi-asset solutions over at VanEck Funds, joining us. That was some cool stuff. It was. Stay with us. More from Bloomberg Businessweek Daily coming up after this.

17:26The thing about AI for business, it may not automatically fit the way your business works. At IBM, we've seen this firsthand. But by embedding AI across HR, IT, and procurement processes, we've reduced costs by millions, slash repetitive tasks, and freed thousands of hours for strategic work. Now we're helping companies get smarter by putting AI where it actually pays off, deep in the work that moves the business. Let's create smarter business, IBM. For many men, mental health challenges aren't recognized until they've already taken a toll. Work pressure, financial stress, changing relationships, and traditional expectations around masculinity can quietly wear men down, often without clear warning signs.

18:10In Season 3 of The Visibility Gap, Dr. Guy Winch and his guests explore how these pressures show up, how to spot them earlier, and how men can access meaningful support. Listen to the new season of The Visibility Gap, a podcast presented by Cigna Healthcare.

18:26Carol Massar:You need to make a huge presentation in an hour. Adobe Acrobat uses AI to take all your documents and generate a presentation with a single click. Build slides quickly and streamline the process. Need a last-minute pitch deck? Do that with Acrobat. Need to level up your presentation design? Do that with Acrobat. You have 30-plus documents that need to be simplified into a proposal. Do that. Do that. Do that with Acrobat. Learn more at adobe.com slash do that with Acrobat.

19:25derivatives, which could increase risks and volatility. Monthly income is not guaranteed. Prepared by BlackRock Investments, LLC.

19:30Carol Massar:You're listening to the Bloomberg Business Week daily podcast. Catch us live weekday afternoons from 2 to 5 Eastern. Listen on Apple CarPlay and Android Auto with the Bloomberg Business app or watch us live on YouTube. The countdown is on. Yes. T-minus 23 hours. That's when we'll know not just the decision, but also the summary of economic projections that will perhaps give us a good idea of the direction of travel for rates. We've got back with us Joyce Wong. She's senior client portfolio manager at American Century Investments. The firm has about$300 billion in assets under management. She joins us here in the Bloomberg Interactive Brokers Studio.

20:08We think we know a lot about tomorrow, like, you know, one rate cut, 25 basis points. What do we not know? Well, we don't know how Chairman Powell is going to message it, right? I think, you know, It's been kind of volatile between the last two months with the government shutdown in between that there was going to be a December rate cut. We always thought there was still going to be the December cut. But I think what's going to happen is that we've always been thinking there won't be as many cuts following this one. So in 2026, we think there could be as few as one additional cut after tomorrow.

20:45The market was kind of more three, four. One all of next year?

20:49Carol Massar:Mm hmm. Yeah. I feel like we've been hearing folks saying that maybe the next one wouldn't come till maybe is it May or later next year. Well, I think that's going to be the messaging around this is how Chairman Powell talks about this cut and when the next one will if and when the next one will come. Is the market prepared for that? Well, that's why I think it's going to be interesting tomorrow. There have been more and more people joining our camp and saying that there's going to be fewer cuts next year than originally thought a few months ago. The reason we think that is because inflation still remains sticky.

21:24Right. We'll see. You know, we are still going to get delayed data. We'll see how the holiday season plays out. But it looks like consumer confidence is staying stable. It's back up a little bit. People are still spending. I saw stats that this was like the best Black Friday in a long time. So it seems like inflationary pressures that we've seen are still there. So the Fed has to be very, very cautious in reducing much further.

21:48Carol Massar:Yeah, it's kind of fascinating. Right. We still have growth. We see softness in the labor market. I mean, is there, though, the nervousness that as we start to see things maybe slow down in some sectors of the labor market choice that all of a sudden it can start to kind of pick up some momentum and it get even worse? Because I do feel like we're increasingly seeing companies talk about AI and don't need as many workers from companies who were like before. Nope, it's not going to be a problem. It does feel like that's picking up momentum as well. Yes. And that's what I'm really curious to see how Chairman Powell messages that is if they do cut tomorrow, it's going to be because they are more concerned about the labor market than inflation.