GameStop Corp., a specialty retailer, provides games and entertainment products through its stores and ecommerce platforms in the United States, Canada, Australia, and Europe. The company sells new and pre-owned gaming platforms; accessories, such as controllers, gaming headsets, and virtual reality products; new and pre-owned gaming software; and in-game digital currency, digital downloadable content, and full-game downloads. It sells collectibles comprising apparel, toys, trading cards, gadgets, and other retail products for pop culture and technology enthusiasts, as well as engages in the digital asset wallet and NFT marketplace activities. The company operates stores and ecommerce sites under the GameStop, EB Games, and Micromania brands; and pop culture themed stores that sell collectibles, apparel, gadgets, electronics, toys, and other retail products under the Zing Pop Culture brand, as well as offers Game Informer magazine, a print and digital gaming publication. The company was formerly known as GSC Holdings Corp. GameStop Corp. was founded in 1996 and is headquartered in Grapevine, Texas.

GameStop’s liquidity position looks unusually strong: cash on hand, the quick ratio, and the current ratio are all at very high levels and noticeably above the industry, which reduces the risk of short-term financial stress. At the same time, the debt burden no longer looks harmless: debt/equity is above the median, and long-term debt has increased sharply compared with previous periods, so part of the balance sheet quality is being offset by rising liabilities. In terms of operating efficiency, the picture has improved compared with a year ago: operating margin, operating income, EBITDA, and net income have all shown notable improvement in their trend, which supports the company’s valuation. However, gross margin is below the industry median, while price/sales and price/FCF remain elevated, meaning the market is still paying more for revenue and cash flow than for most comparable companies. P/E now looks closer to normal and no longer appears extreme, but historically the multiple was significantly higher, which indicates high sensitivity in the valuation to expectations. P/B is slightly below the median, which partially supports the idea of a not overly expensive balance-sheet valuation, but this advantage is limited by weak comparative capital profitability. ROA and net profit margin look stronger than the industry, whereas ROE, ROI, and return on tangible equity do not provide a convincing advantage and remain roughly average or weaker than the benchmark. Revenue and profit in absolute terms look better than in previous periods, but the scale of the business is still small for a sustainable re-rating, especially in a competitive consumer segment. The absence of dividends removes one source of support for an income-oriented investor. Overall, the fundamentals have improved rather than deteriorated, but the high valuation on sales and FCF, as well as rising debt, limit upside potential. Therefore, the target forecast should be lowered slightly, while maintaining a conservative view of growth quality and the fact that the market has already priced in part of the improvement.

GameStop Corporation

Liquidity and profitability have improved, but the high valuation based on revenue and FCF, along with rising debt, limits GameStop's stock upside.

(RTTNews) - Uber Technologies, Inc. (UBER) said on Wednesday that its delivery unit Uber Eats has partnered with GameStop Corp. (GME) to offer delivery of video games, gaming consoles, accessories, collectibles and electronics from GameStop locations nationwide via the Uber Eats app.
Customers can order for scheduled or on-demand delivery, Uber said.
Uber Eats' marketplace now includes thousands of storefronts across grocery, convenience, beauty, home improvement, office supplies, pet supplies, electronics and other categories, with GameStop the latest addition.
"Adding GameStop to Uber Eats strengthens our growing gaming and electronics selection, giving customers access to another trusted retailer they can shop with the speed and convenience they know from Uber." said Hashim Amin, Head of Grocery and Retail for Uber in North America.
To order, customers can open the Uber Eats app, go to the 'Retail' or 'Electronics' category, search for GameStop, add items, choose a delivery time, and track the order in real time, Uber said.
On NYSE, shares of Uber Technologies are currently gaining 1.13 percent, changing hands at $72.90.
GameStop shares are currently trading 0.22 percent lower at $22.38 on NYSE.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Uber Eats Partners With GameStop To Deliver Video Games, Collectibles Nationwide

Key Points
Best Buy currently looks substantially stronger on revenue, generating significantly higher sales volumes than GameStop.
The two companies exhibit a highly seasonal revenue pattern over the last eight quarters, with massive quarter-over-quarter spikes followed by consistent subsequent declines.
Investors should watch whether the massive revenue gap between the two companies remains steady or begins to shift over upcoming seasonal cycles.
Best Buy: Managing a Massive Revenue Base
Best Buy (NYSE:BBY) primarily generates revenue by selling a wide array of consumer electronics, household appliances, and entertainment products, alongside offering consultation, repair, and technical support services to its customers.
It recently appointed Jason Bonfig as its new Chief Executive Officer, and for the quarter ended May 2, 2026, it reported a net income margin of 3%.
GameStop: Smaller Scale With Similar Seasonal Shifts
GameStop (NYSE:GME) earns most of its revenue by providing new and pre-owned video game consoles, software, and accessories, along with digital gaming content and licensed pop culture merchandise.
It recently submitted an unsolicited proposal to acquire eBay for $55.5 billion, which eBay’s Board of Directors rejected. For the quarter ended May 2, 2026, it recorded a net income margin of 47%.
Why Revenue Matters for Retail Investors
Revenue here represents the total money a company brings in from its operations before any expenses are deducted, which helps investors gauge overall customer demand and business scale.
Quarterly Revenue for Best Buy and GameStop
Quarter (Period End)
Best Buy Revenue
GameStop Revenue
Q3 2024 (Aug. 2024)
$9.3 billion
$798.3 million
Q4 2024 (Nov. 2024)
$9.4 billion
$860.3 million
Q1 2025
$13.9 billion (period ended Feb. 2025)
$1.3 billion (period ended Jan. 2025)
Q2 2025 (May 2025)
$8.8 billion
$732.4 million
Q3 2025 (Aug. 2025)
$9.4 billion
$972.2 million
Q4 2025 (Nov. 2025)
$9.7 billion
$821.0 million
Q1 2026 (Jan. 2026)
$13.8 billion
$1.1 billion
Q2 2026 (May 2026)
$8.9 billion
$835.3 million
Data source: Company filings. Data as of July 13, 2026.
Foolish Take
As is typical for retailers, Best Buy and GameStop experience sales spikes over the holiday shopping season in November and December. The former’s vastly higher revenue illustrates how the electronics retailer successfully navigated shifts in its business as consumers abandoned physical movie and video game media for digital versions. Its sales edged up to $8.9 billion in its fiscal first quarter ended May 2 compared to $8.8 billion in the prior year.
GameStop is attempting to adjust to changes in shopping behavior by introducing collectibles, which helped drive 14% year-over-year sales growth in its fiscal first quarter ended May 2. The company also posted the highest quarterly net income in its history, reaching $389.6 million, as a result of a confluence of cost management, higher revenue, and gains on investments such as Bitcoin.
Over the long term, Best Buy stands to see continued revenue growth. It has diversified across computers, appliances, mobile phones, and other products that provide resilience against economic headwinds. Meanwhile, GameStop still needs to prove it has a sustainable business as its core video games offering is in rapid decline, especially after Sony announced its PlayStation console will only sell digital content starting in 2028.
Should you buy stock in Best Buy right now?
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Robert Izquierdo has positions in Best Buy and Sony Group. The Motley Fool has positions in and recommends Best Buy, Bitcoin, and eBay. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Best Buy vs. GameStop: What Their Revenue Trends Tell Investors About These Specialty Retailers

Key Points
Sony announced this week that it will no longer put out video games on discs for new PlayStation releases starting in 2028.
GameStop's model once relied primarily on the sale -- and, more importantly, the resale -- of video games.
GameStop is trading at a reasonable earnings multiple, and it has enough cash to keep shopping for change after being rebuffed by eBay.
There are plenty of things weighing on GameStop (NYSE: GME) these days. Annual revenue is now 61% lower than when it peaked 14 fiscal years ago, and that's without accounting for inflation. Despite its meme-stock appeal, the small-box retailer of video games and collectibles has seen its sales contract in each of the past four fiscal years.
It tried to shake things up with an unsolicited buyout offer for eBay (NASDAQ: EBAY) two months ago, but GameStop has been outbid by reality. This week, the chain got another worrying sign: Sony (NYSE: SONY) announced on Monday that it will cease physical game disc production for new games releasing on PlayStation consoles starting in 2028.
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Spin doctors
Time hasn't been on GameStop's side for years, but now there's a date for the potential end. We're now 18 months away from when one of the three leading console makers goes solely digital in distributing new titles. Sure, you can buy access to digital codes through brick-and-mortar retailers. It's just become less necessary to do so in person. Console makers and software developers are cutting out the middleman.
The digital migration isn't new, and some consoles have been available without an optical disc drive since 2019. However, PlayStation gamers won't have the option to switch to spinning discs for new releases come 2028. This is bad for GameStop not just for the potential slide in store traffic as digital delivery becomes the industry standard. GameStop used to carve out a high-margin living selling refurbished discs and cartridges of popular games. Now it's leaning on collectibles to offset the slide in its resale business. That approach is working -- for now -- but collectibles don't offer the scalability and differentiated advantages that made GameStop's moat so effective a generation ago.
No more going in circles?
The news isn't all bad for GameStop. Profitability is growing despite four fiscal years of declining sales. Despite all the meme-stock hype, the video game stock is trading at a reasonable 21 times forward earnings. However, the surprising 14% jump in net sales was fueled entirely by a spike in interest for the store's trading cards, apparel, toys, and pop-culture merchandise. Back out the collectibles business, and net sales declined 7%. The business model isn't as sustainable as its former flywheel, but there are worse places to be in the retail space.
GameStop also has a cash-rich balance sheet. It wasn't enough to land eBay -- even if GameStop isn't throwing in the towel on the platform deal just yet -- but it will probably have to aim smaller if it eventually tries to grab something else. A company isn't going to take a stock-and-cash deal from a business whose shares have declined 4% over the past year and plummeted 56% over the past five years.
Sony's move is evolutionary, not revolutionary. Will other console makers follow, in today's climate of rising memory and data storage costs? GameStop isn't in the clear, but it has resources, if not cheat codes, to keep playing the game.
Should you buy stock in GameStop right now?
Before you buy stock in GameStop, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and GameStop wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $400,101!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,212,683!*
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Rick Munarriz has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends eBay. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Is the Clock Ticking on GameStop Stock?

Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in GameStop Corp (Symbol: GME), where a total volume of 69,685 contracts has been traded thus far today, a contract volume which is representative of approximately 7.0 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 113.5% of GME's average daily trading volume over the past month, of 6.1 million shares. Particularly high volume was seen for the $22 strike call option expiring July 02, 2026, with 6,929 contracts trading so far today, representing approximately 692,900 underlying shares of GME. Below is a chart showing GME's trailing twelve month trading history, with the $22 strike highlighted in orange:
TPG RE Finance Trust Inc (Symbol: TRTX) saw options trading volume of 8,003 contracts, representing approximately 800,300 underlying shares or approximately 108% of TRTX's average daily trading volume over the past month, of 741,050 shares. Particularly high volume was seen for the $9 strike call option expiring October 16, 2026, with 8,003 contracts trading so far today, representing approximately 800,300 underlying shares of TRTX. Below is a chart showing TRTX's trailing twelve month trading history, with the $9 strike highlighted in orange:
And NVIDIA Corp (Symbol: NVDA) options are showing a volume of 1.7 million contracts thus far today. That number of contracts represents approximately 173.9 million underlying shares, working out to a sizeable 106.8% of NVDA's average daily trading volume over the past month, of 162.9 million shares. Particularly high volume was seen for the $200 strike call option expiring July 01, 2026, with 229,539 contracts trading so far today, representing approximately 23.0 million underlying shares of NVDA. Below is a chart showing NVDA's trailing twelve month trading history, with the $200 strike highlighted in orange:
For the various different available expirations for GME options, TRTX options, or NVDA options, visit StockOptionsChannel.com.
Further GME Research:
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Noteworthy Tuesday Option Activity: GME, TRTX, NVDA

(RTTNews) - GameStop Corp. (GME) announced that it remains focused on advancing its proposed acquisition of eBay Inc. The company emphasized its commitment to pursuing the transaction despite recent developments.
GameStop currently expects to generate Adjusted EBITDA in excess of $600 million for fiscal year 2026, a significant increase compared to Adjusted EBITDA of $345.4 million reported in fiscal year 2025. This outlook underscores the company's confidence in its operating performance and strategic direction.
Last month, global commerce major eBay Inc. (EBAY) announced that its Board of Directors had rejected GameStop's unsolicited, non-binding acquisition proposal. The decision marked a setback in GameStop's efforts to secure the deal.
On May 3, GameStop revealed details of its proposal to acquire eBay for $125 per share, structured as 50 percent cash and 50 percent GameStop common stock. The offer represented a 46% premium to eBay's unaffected closing price on February 4, 2026, highlighting the value GameStop believed the transaction could deliver to eBay shareholders.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

GameStop Pushes Ahead With Bid For EBay Despite Board Rejection

Key Points
Wendy's recently appointed a new CEO and CFO, both of whom have experienced reenergizing struggling brands.
Wendy's stock has fallen more than 65% in the past five years.
The company plans to significantly expand its footprint in China.
Meme stock mania strikes again, with The Wendy's Company (NASDAQ: WEN) shares soaring as much as 42% this week. No, Wendy's didn't suddenly sell a record number of hamburgers or launch a new signature sandwich. The surge was caused by a viral post on Reddit's (NYSE: RDDT) infamous WallStreetBets forum. The group decided to rally behind Wendy's as an institution worth "saving."
Much like GameStop and AMC a few years ago, Wendy's was the perfect fit for the meme-stock lovers. As a brand that has underperformed for quite some time and is heavily shorted, Wendy's has gained support from activist Redditors. While meme-style investing is not recommended for long-term investors, there are legitimate reasons to be cautiously optimistic about Wendy's future.
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Can Wendy's make a serious comeback?
First, Wendy's just named industry veteran Steve Cirulis as chief financial officer and chief strategy officer. He and CEO Bob Wright previously worked together to turn around Potbelly Sandwich Works. During their time at Potbelly, shares climbed more than 500%. Their strategy with Wendy's could potentially have similar positive results.
Secondly, Wendy's expansion plans, particularly in China, could be an important growth engine for the company, as the U.S. market is largely saturated. Chinese consumers have really embraced American fast food over the past decade, but competition is increasing there as well.
It won't be easy for Wendy's
The path forward is still quite steep for Wendy's. It is significantly trailing the competition in foot traffic, and same-store sales are in a prolonged slump. Meme stock rallies are also notoriously volatile and unpredictable.
For investors, it's important to remember to focus on the company's financials and strategy execution. Wendy's is primed for a turnaround, but it'll neither be quick nor based on viral Reddit posts. Time will tell if the turnaround plan is truly working in the coming quarters.
Should you buy stock in Wendy's right now?
Before you buy stock in Wendy's, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Wendy's wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $382,359!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,201,390!*
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*Stock Advisor returns as of June 26, 2026.
Catie Hogan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Reddit. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

What Investors Should Know About Wendy's Sudden Surge

(RTTNews) - GameStop Corp. (GME), a video game and electronics retailer, Wednesday said that its Board of Directors has approved the request of Chairman and Chief Executive Officer Ryan Cohen to remove the CEO Performance Award, which was approved in January this year. This was before GameStop decided to move on with the acquisition of eBay Inc. (EBAY).
According to the company, Cohen is of the opinion that GameStop management should be completely focused on improving its operating performance and the upcoming eBay acquisition.
GameStop Corp said that it will release additional materials in the upcoming week outlining the strategic rationale and operational plan for the combined business.
On the NASDAQ, GME ended Tuesday's trading at $21.08, down 0.28 percent. In overnight trading, the stock rose 0.95 percent to $21.28.
On the NASDAQ, EBAY ended Tuesday's trading at $108.97, up $4.03 or 3.8 percent. In overnight trading, the stock was up 0.49 percent at $109.50.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

GameStop Removes CEO Performace Award To Support EBay Takeover

Key Points
GameStop maintained a strong liquidity position and reported a double-digit net margin in fiscal 2025.
StubHub continues to grow its global marketplace reach through new international event partnerships.
Which of these consumer-focused stocks is the better addition to your portfolio today?
Investors often weigh established retail names against digital marketplace leaders when seeking growth. Choosing between GameStop (NYSE:GME) and StubHub (NYSE:STUB) requires a deep dive into their shifting business models and 2026 valuations.
GameStop continues to pivot its legacy physical gaming business toward a leaner model despite declining top-line sales. StubHub remains a dominant force in live event ticketing, though it faces unique regulatory challenges and significant net losses. This article explores how their respective strategies and financial health compare for investors looking at the current market.
The case for GameStop
GameStop sells games, collectibles, and entertainment products through thousands of stores and digital platforms. Within the landscape of retail stocks, the company relies heavily on relationships with major gaming vendors like Sony and Nintendo. These key partners accounted for a majority of new product purchases in fiscal 2025, which means high customer concentration adds a layer of risk to the business.
In its 2025 fiscal year (FY), revenue reached $3.6 billion, representing a decline of 5.1% compared to the prior year. Despite lower sales, the company reported a net income of $418.4 million, which was a notable increase from the $131.3 million earned in fiscal 2024. The 11.5% net margin, which measures how much profit is kept from every dollar of sales, reflects this year-over-year improvement.
As of its January 2026 balance sheet, the debt-to-equity ratio was 0.8x. This ratio measures total debt against shareholder equity, with a lower number typically suggesting a less risky financial structure. The current ratio stands at 15.3x, explaining the company’s strong ability to cover its short-term liabilities with current assets. During FY 2025, the company generated free cash flow of $597.3 million.
The case for StubHub
StubHub operates a global marketplace that connects fans with sellers of tickets for live sports, music, and theater events. The company manages two major brands, serving customers in over 200 countries and supporting dozens of languages. To expand its reach, the company recently entered an open distribution partnership with ULTRA Europe to increase its inventory of international events.
During FY 2025, revenue was $1.7 billion, which was a slight decrease of 1.4% from the previous year. The company reported a net loss of $1.9 billion for the fiscal year, a significant shift from the net income generated in 2023. The net margin for the period was negative 109.2%, indicating that total expenses significantly exceeded revenue.
According to the December 2025 balance sheet, StubHub maintains a debt-to-equity ratio of 0.8x. This level of leverage indicates the company uses a moderate amount of debt to fund its operations relative to its equity. The current ratio is 1.0x, meaning the company has just enough short-term assets to cover its upcoming bills. Despite the reported net loss, the company generated free cash flow of $191.2 million in FY 2025.
Risk profile comparison
GameStop faces significant pressure from the shift toward digital game downloads, which threatens its physical software market. The company is also highly dependent on CEO Ryan Cohen, and a 2026 shareholder lawsuit regarding his performance award has created some leadership uncertainty. Furthermore, the company holds volatile assets like Bitcoin (CRYPTO:BTC), which exposes it to market swings and accounting risks. Competition remains fierce from mass-market giants like Walmart.
StubHub must navigate a complex regulatory environment, highlighted by a $10 million settlement with the FTC over hidden fees in April 2026. Its business is also entirely dependent on the health of the live events industry, which can be disrupted by economic downturns or tour cancellations. The company faces intense competition from primary ticket sellers and other secondary platforms. Additionally, as a digital-first company, it relies on third-party cloud infrastructure, making it vulnerable to system interruptions.
Valuation comparison
GameStop trades at a lower Forward P/E than StubHub, while StubHub features a lower P/S ratio relative to its peer.
Forward P/E
19.7x
25.7x
28.6x
P/S ratio
2.7x
2.3x
n/a
Sector benchmark uses the SPDR XLY sector ETF. Valuation metrics sourced from Financial Modeling Prep (FMP) and may differ from other data providers.
Which stock would I buy in 2026?
Both GameStop and StubHub are at key inflection points in their histories. GameStop’s core retail business is in decline, and it is trying to find a path forward under CEO Ryan Cohen. StubHub went public in September of 2025 at $23.50 per share, and now must prove its stock price can rebound as shares remain well below the IPO price.
GameStop is doing well from a financial perspective. It had the highest quarterly net income in its history, reporting $389.6 million in its fiscal first quarter ended May 2. The company is building a business around collectibles, and as a result, Cohen sees synergies with e-commerce giant eBay.
That’s why GameStop tried to buy eBay. Although its offer was rejected by eBay’s Board of Directors, GameStop may pursue a hostile takeover attempt.
StubHub’s 2025 performance wasn’t ideal, but it’s off to a strong start in 2026. In Q1, revenue rose 12% year over year to $446.0 million. In addition, the company made a dramatic reversal from a net loss of $22.2 million in 2025 to net income of $48.0 million this year.
Although GameStop’s financials are looking good, I would buy StubHub stock over the retailer. GameStop is still finding a path to long-term revenue growth. I’m not convinced its focus on collectibles and attempts to buy eBay will make it a good investment over the long haul. Meanwhile, StubHub’s Q1 results demonstrate its business has the potential to deliver solid gains in time.
Should you buy stock in GameStop right now?
Before you buy stock in GameStop, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and GameStop wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $393,037!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,280,627!*
Now, it’s worth noting Stock Advisor’s total average return is 913% — a market-crushing outperformance compared to 208% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
Robert Izquierdo has positions in Walmart. The Motley Fool has positions in and recommends Bitcoin, Walmart, and eBay. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

GameStop vs. StubHub: Which Consumer Stock Is a Better Buy in 2026?

Key Points
SpaceX will be valued at nearly 100 times sales when it goes public.
It could generate disappointing returns in the first year.
SpaceX (NASDAQ: SPCX), the aerospace and AI company founded by Elon Musk, will go public on June 12. It's set the IPO price at $135 per share and aims to raise $75 billion, valuing the company at about $1.77 trillion and making it the biggest IPO in history.
The IPO is already more than four times oversubscribed, suggesting it will start trading at an even higher price. So what could a $10,000 investment in SpaceX's IPO be worth in a year?
Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »
The biggest problems with SpaceX's IPO
At its target valuation, SpaceX would trade at 95 times its 2025 revenue of $18.67 billion. That represented 33% growth from 2024, but it's still a lofty price-to-sales ratio.
SpaceX generates most of its revenue and all of its operating profits from Starlink. Its space division, which produces its Falcon rockets, is still unprofitable. Last year, SpaceX squeezed out a profit by using Starlink's profits to offset the space division's losses.
But this year, it integrated xAI (which owns X and Grok) into SpaceX as its new AI division. The AI division's massive losses ($4.3 billion in the first quarter of 2025) wiped out Starlink's profits. SpaceX plans to ramp up its AI investments after its public debut, which implies it will remain unprofitable for the foreseeable future. That's probably why it's so eager to raise fresh cash.
SpaceX is also offering less than 5% of its shares in its IPO, which shields Musk from big investors and allows him to maintain an 82% voting stake in the company. It's also allocating up to 30% of its shares to retail investors -- which indicates it's intentionally targeting the same "meme stock" investors that gobbled up stocks like GameStop.
How much will a $10,000 investment in SpaceX grow?
All of these issues are preventing me from chasing SpaceX's IPO. Instead, I think it's smarter to stick with its smaller peers -- like AST SpaceMobile and Rocket Lab -- until the smoke clears.
I believe SpaceX's stock will briefly skyrocket after its public debut, but then pull back as its IPO investors flip it for a quick profit. After that, the stock will likely stagnate and slump lower as it's revalued at a more sustainable price-to-sales ratio.
Let's assume SpaceX grows its revenue by 30% to $24.3 billion in 2026 and by another 30% to $31.5 billion in 2027. Even if it trades at a frothy 50 times its current-year sales by June 2027, its market cap would still be only $1.58 trillion -- an 11% decline from its target valuation.
Therefore, I expect a $10,000 investment in SpaceX's IPO to be worth less in a year. It might eventually bounce back, but too much growth has already been baked into its stock.
Should you buy stock in Space Exploration Technologies right now?
Before you buy stock in Space Exploration Technologies, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Space Exploration Technologies wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $439,038!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,277,804!*
Now, it’s worth noting Stock Advisor’s total average return is 942% — a market-crushing outperformance compared to 206% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
*Stock Advisor returns as of June 10, 2026.
Leo Sun has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends AST SpaceMobile and Rocket Lab. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

SpaceX Is Going Public at a $1.77 Trillion Valuation. Here's What a $10,000 Investment Could Return.

The meme stock reported increasing revenue as its collectibles business creates a reason for people to visit stores.
Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »
*Stock prices used were the afternoon prices of June 3, 2026. The video was published on June 5, 2026.
Should you buy stock in GameStop right now?
Before you buy stock in GameStop, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and GameStop wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $443,191!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,258,838!*
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*Stock Advisor returns as of June 7, 2026.
Parkev Tatevosian, CFA has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Parkev Tatevosian is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.