Imagine you are sitting on a rooftop in Tehran at one in the morning. The city below seems off, not because it is sleeping, but because someone flipped the switch. The mobile towers are dead. The fiber lines are severed. Landlines emit nothing but static. For weeks earlier this year, a nation of 90 million people was cut off from the rest of the planet, sealed inside an information vacuum while security forces patrolled the streets below.
But all hope was not lost. Hidden under a tarp on the roof, no bigger than a large pizza box, was a small, flat antenna aimed at the sky. You power it on. A faint hum. A blinking light. And then, for the first time in days, the world comes flooding back. Not through cables in the ground or towers on the horizon, but through a constellation of satellites screaming overhead at 17,000 miles per hour, roughly 340 miles above your head.
While this might sound crazy, this is not science fiction. In fact, this happened last month. As reported by The Wall Street Journal this week, the U.S. government covertly smuggled approximately 6,000 Starlink satellite-internet terminals into Iran following the regime’s brutal crackdown on nationwide protests in January. It was the first time the United States had directly shipped Starlink hardware into the country, a move designed to keep activists and dissidents connected when every conventional pathway to the internet had been destroyed.
It is a striking story of technology, geopolitics, and human courage. But it is also a story about a business. Those little pizza-box antennas belong to SpaceX. And SpaceX just became one of the most consequential companies on Earth, both figuratively and literally, in ways that reach far beyond rooftops in Tehran.
A Trillion-Dollar Handshake
On February 2nd, Elon Musk’s SpaceX announced it had acquired Elon Musk’s artificial intelligence company, xAI, in a deal valued at $1.25 trillion. Let that number sit for a moment. It is the largest merger in history, creating the most valuable private company the world has ever seen.
Musk’s stated rationale was ambitious even by his standards: he wants to build data centers in space. The idea is to use the next generation of Starlink satellites not just to beam internet to your rooftop, but to actually do the artificial intelligence processing in orbit, using the vacuum of space for natural cooling and the sun for perpetual power. Whether this sounds visionary or delusional likely depends on your prior opinion of Musk, but the financial architecture of the deal reveals something more grounded.
SpaceX generated an estimated $8 billion in profit last year. xAI, by contrast, burns roughly $1 billion per month in its race to compete with OpenAI and Google. The merger effectively takes xAI’s voracious appetite for cash and tethers it to Starlink’s growing, reliable revenue stream. Think of it as the modern-day, company-level execution of hitching your wagon to a star.
And none of this is happening in a vacuum (pun intended). SpaceX is definitely preparing for its IPO, with betting markets currently putting the odds of a SpaceX IPO before September at 76%. Moreover, it is anticipated to be one of the largest initial public offerings in history, reportedly targeting a valuation of up to $1.5 trillion. That would put it right around Saudi Aramco’s 2019 record of $1.7 trillion.
Covert Ops to Public Markets
So what does smuggling satellite dishes into Iran have to do with your investments?
The Iran operation is the clearest, most visceral demonstration of Starlink’s strategic value. It proved that even a state willing to deploy military jamming equipment and imprison its own citizens cannot neutralize a constellation of thousands of low-orbit satellites. That’s not a humanitarian talking point; that’s a product demo. And the customer isn’t just Iranian dissidents. It’s every government, military, shipping company, airline, and rural community on Earth that needs connectivity they can’t lose.
Starlink already serves an estimated 7 to 8 million subscribers worldwide. SpaceX launched more rockets in 2025 than every other company and nation-state on the planet combined. Their Starshield division, a classified unit providing secure satellite communications to the U.S. military, has contracts with the Pentagon. This is no longer a startup with a cool idea. It is becoming a go-to for worldwide communication and defense networks.
When this company goes public, it will undoubtedly be one of the most anticipated IPOs of our generation. And that’s precisely where investors need to take a deep breath, sit on their hands, and think clearly.
The Hype Premium
With all of the excitement, though, don’t forget to watch out for the hype machine. A company does something genuinely extraordinary. The story becomes irresistible. And then investors, motivated by the emotion of the story rather than the math of the valuation, pay a price that has already absorbed years of future growth.
At a rumored $1.5 trillion IPO valuation, SpaceX would trade at roughly 75 times its estimated 2025 revenue. For context, that is over seven times Microsoft’s revenue multiple. Even the most optimistic analysts acknowledge that justifying that number requires believing not only in Starlink’s growth but also in the commercial viability of orbital data centers, the continued expansion of classified military contracts, and the long-term monetization of Starship launches. That’s a lot of boxes to check simultaneously.
This isn’t to say SpaceX is a bad company, not at all. It very well might be the most impressive private enterprise of the 21st century. But there is a difference between a great company and a great investment, and that difference is price. History is littered with extraordinary businesses that were lousy investments because people bought at the peak of the hype cycle. We’ve talked about that before here and here.
The merger with xAI adds another layer of complexity. xAI’s burn rate is staggering, and its flagship AI model, Grok, has already generated headlines for the wrong reasons, including regulatory probes over content safety failures. Approximately 15 to 20 percent of SpaceX’s revenue comes from classified government work, meaning public investors won’t be able to independently verify a meaningful portion of the income statement. For a company asking for the largest valuation in IPO history, these are not trivial details.
Keep the Signal
Back on that rooftop in Tehran, the person powering on their Starlink terminal isn’t thinking about revenue multiples or IPO valuations. They’re thinking about connection and about getting the truth out. And that instinct, to believe in something so powerful that you’re willing to risk everything for it, is intrinsically human. It is also, coincidentally, the exact same instinct that causes investors to chase a story into an overpriced stock.
The SpaceX IPO will be one of the defining financial events of 2026. It will be accompanied by breathless coverage, bold predictions, and a line of investors stretching around the block. Some of it will be warranted. The company’s technological achievements are real, and its competitive moat is formidable. But the most important question isn’t whether SpaceX is an incredible company. It’s whether the price you pay for it leaves any room for you to make money.
The lesson from Iran isn’t just about geopolitics or technology. It’s about signal versus noise. In a blackout, the people who stayed connected were the ones who prepared methodically, hid their antennas carefully, and resisted the panic of the moment. Investors would do well to adopt the same discipline. When the SpaceX IPO arrives, the signal will be there. Just make sure you can hear it over the static.
Markets / Economy
- Markets remained volatile all week, as the “AI is eating the world” trade continued to drive fear in certain sectors. The S&P finished the week down -1.4%, the Nasdaq down -2.1%, and the small-cap Russell 2000 down -0.9%.
- U.S. Retail Sales unexpectedly stalled in December, following a 0.6% increase in November and falling short of forecasts for a 0.4% gain.
- The U.S. economy added 130K jobs in January, much higher than a downwardly revised 48K rise in December and well above forecasts of 70K.
- The U.S. unemployment rate ticked down to 4.3% in January from 4.4% in December, coming in slightly below market expectations.
- Existing Home Sales in the U.S. tumbled 8.4% in January, the biggest drop since February 2022.
Stocks
- U.S. equities were in negative territory. Financials and Consumer Discretionary led the decline, while Utilities and Real Estate outperformed. Value stocks led growth stocks, and small caps beat large caps.
- International equities closed higher for the week. Emerging markets fared better than developed markets.
Bonds
- The 10-year Treasury bond yield decreased 15 basis points to 4.06% during the week.
- Global bond markets were in positive territory this week.
- Government bonds led for the week, followed by corporate bonds and high-yield bonds.
