SpaceX experienced a sharp single-day decline of over 13% on Wednesday, triggered by its first earnings report since going public. Institutional investors led the sell-off, while retail investors aggressively bought the dip, reaching opposite conclusions from the same financial data.

The core catalyst for the sell-off was a massive and unexpected surge in AI capital expenditure. SpaceX reported second-quarter capital expenditures exceeding $18 billion in its Tuesday after-hours earnings release, nearly 40% above analyst expectations. The bulk of this spending was directed toward data center construction and other AI-related projects. Institutional investors reacted swiftly and negatively, sending the stock price lower.

As institutions sold, retail investors stepped in as buyers, recording a record net purchase amount in the first hour of trading on Wednesday. This divergence between institutional and retail investors highlights differing frameworks for interpreting AI's high-investment business model. Institutions focus on near-term financial metrics—the rapid expansion of capital spending pressures free cash flow and creates uncertainty about short-term profitability. In contrast, retail investors tend to view massive AI investments as building long-term competitive moats, betting that SpaceX will follow the "heavy investment, later returns" growth path of previous tech giants.

Meanwhile, the market faces another major pressure: up to 911.5 million shares of SpaceX are scheduled to become unlocked for trading on Thursday, representing a market value of over $100 billion. This will more than double the number of shares in free float. It is one of the largest post-IPO stock unlock events in U.S. market history, with additional unlocks continuing through December.

Earnings Overspend Triggers Institutional Exodus

SpaceX closed at $108.27 on Wednesday, down 13.6% from the previous session. This decline was the primary factor dragging the Nasdaq Composite Index down 0.83% on the day, making it the only major U.S. stock index to close lower. Compared to its IPO price of $135 on June 12, the stock has dropped approximately 20%.

The earnings report showed SpaceX's second-quarter capital expenditures exceeded $18 billion, far surpassing Wall Street expectations with a nearly 40% increase. This figure raised concerns among institutional investors about the company's near-term profitability, prompting them to reduce positions immediately after the earnings release. Notably, before the report, SpaceX shares were rising during Tuesday's trading session, and some analysts observed unusually strong buying activity in call options, indicating high market expectations for the earnings. This ultimately led to a "buy the rumor, sell the news" pattern.

Retail Investors Buy the Dip, Setting a Net Purchase Record

While institutions sold, retail investors displayed a completely different market assessment. According to data from Vanda Research, retail investors' net purchase of SpaceX stock in the first hour of trading on Wednesday reached $22 million. This ranked as the third-highest among the stock's 37 opening trading sessions since its listing, and was more than three times the average first-hour net inflow.

In comments provided to MarketWatch, the Vanda Research team stated: "Institutional investors initially focused on the sharp rise in AI capital expenditure and near-term earnings pressure, while retail investors seem to have drawn the opposite conclusion. Today's buying activity suggests that investors continue to view aggressive AI investment as a signal that SpaceX's probability of becoming a long-term winner has increased, rather than a reason to sell."

Unlock Wave Approaching, Historical Data Provides a Reference

The bigger test may come from the supply side. Up to 911.5 million restricted shares held by early investors and company insiders will begin to unlock starting Thursday, more than doubling SpaceX's free-float share count. Additional shares will unlock in August and September, continuing through December, making it one of the largest post-IPO unlock events in U.S. market history.

Spectra Markets founder Brent Donnelly cited three widely watched stock unlock cases from recent years for comparative analysis. While the sample size is small and the unlock sizes in those previous cases were far smaller than SpaceX's, the data shows that in all three instances, the first unlock day formed a buyable bottom—though the subsequent recovery was not V-shaped.

Donnelly stated: "My starting point is that this information should already be fully priced into the market at this stage. The upcoming supply shock is more likely to be a misleading bearish signal rather than a genuinely effective negative factor."