SpaceX shares gain as lock-up fears ease

SpaceX shares were trading about 5% higher roughly an hour after open on Thursday even as 911.5 million shares valued at approximately $100 billion were released from lock-up agreements that previously restricted insiders from selling.

Over 120 million shares have changed hands so far.

The gains follow a 14% decline post SpaceX's first earnings report, where investors responded negatively to the company's artificial intelligence spending, which exceeded expectations. Wall Street analysts maintained a positive outlook on the stock overall.

Thursday's lock-up expiration increased the total number of tradable shares to 1.55 billion, up from 639 million that were available when Space Exploration Technologies Corp. completed its initial public offering in June. The company sold shares at $135 each in what was a record IPO.

Many early investors and long-time employees retain paper profits even with shares trading below the IPO price.

Another scheduled lock-up release is set for June 2027, when 6.4 billion shares of Musk's Class A common stock will become available for trading.

Short interest in the stock reached 36% of the float as of Wednesday, according to S3 Partners LLC data. Short sellers have accumulated paper gains exceeding $9 billion from the stock's decline.