Many others, including myself, have stated that SpaceX’s IPO could have popped the AI bubble if it didn’t go well. Well, Musk’s AI/social media/rocket company hasn’t exactly had a smooth ride. After a rapid initial climb, over just a week of trading, SpaceX lost 28.7% of its value from its peak (read more here)! In fact, its share price has crashed so much that it is now below its debut price. With its share price rising and crashing back to Earth as quickly as one of countless failed Starship launches, it’s hard to call this an out-and-out success. This mini boom-and-bust is not a good sign for an industry that requires exponential growth. As such, there is an argument that SpaceX has just popped the AI bubble—we just don’t know it yet.
Let’s start with what we mean by the AI bubble bursting. According to Investopedia, an economic bubble is when trades are made “at a price, or within a price range, that greatly exceeds the asset’s intrinsic value.” SpaceX’s, OpenAI’s and Anthropic’s current valuations fall well within this definition. Investopedia defines bubbles as having four stages, with the final ‘pop’ being the panic stage, which it defines as “asset prices reversing and falling, often as quickly as they had risen. Investors want to liquidate them at any price. Asset prices decline as supply outshines demand.”
This is why SpaceX’s IPO is so shocking to those at the top of the AI bubble. Its rapid fall suggests that investors were more interested in flipping or liquidating their shares, even at a loss. It portrayed these investors as seeking a get-rich-quick flip scheme, more akin to trading card scalpers than actual long-term investors. Such speculative investors are highly fickle and ready to sell at the drop of a hat. Now, I must add that this is only how it appears. Thanks to how SpaceX structured its IPO, such volatility should be expected. But if this downward trend continues, and SpaceX insiders liquidate as soon as their lock-up periods expire, it will confirm this is the case.
However, it seems this concern is enough to deeply spook the major AI players.
As reported by the New York Times last week, OpenAI is considering delaying its IPO until 2027, citing SpaceX’s IPO and claiming they do not think they can reach their $1 trillion target price under today’s market conditions. In other words, they have witnessed the SpaceX sell-off, and it has made them deeply worried.
Now, do I believe OpenAI’s excuse that SpaceX’s IPO is the only reason? Hell no. The leaked financials Ed Zitron published completely torpedoed their chance of controlling the narrative over their heinous finances, making a smooth IPO totally impossible. Moreover, OpenAI CFO Sarah Friar stated the company isn’t ready for an IPO this year, citing its horrendous financial position but also the colossal organisational issues that needs to be ironed out first. I have also seen an argument that OpenAI’s IPO underwriters may have valued the company below its previous $852 billion valuation, which would be a total disaster for its speculative value. OpenAI has plenty of reasons to back away from its IPO plans; the signals from SpaceX’s IPO might have just been a nail in the coffin.
There are rumours that Anthropic has also delayed its IPO to next year, such as this article and this article. That being said, no major publication has covered or verified this topic, and both these sites rank very high on AI checkers. So, this could be total BS to generate clicks. As such, I still believe Anthropic is still going for its October 2026 IPO target. But it is nonetheless interesting that people are spreading these kinds of rumours. It suggests that this backtracking is what a reasonable portion of the market expects.
This is all well and good, but there is just one problem: neither Anthropic nor OpenAI can afford to delay their IPOs because they need the cash to stave off bankruptcy.
AI is heinously unprofitable. Again, Ed Zitron discovered that OpenAI lost $38.5 billion in 2025 (read more here). In fact, OpenAI’s losses are mounting so rapidly that even with huge investments, analysts have projected it could go bankrupt by 2027.
Anthropic has tried to meekly suggest that its books are better and headed towards profitability. But as Ed Zitron has pointed out, this is more of an accounting trick and market circumstance than actual profitability. In fact, Anthropic’s CEO, Dario Amodei, has said that if growth forecasts are off by a year, they will go bankrupt and that they need to generate hundreds of billions of dollars in revenue to become financially sustainable. Considering how AI revenues and AI returns are not increasing as predicted, and we are seeing the beginning of an AI U-turn, as businesses realise how useless and expensive it is (read more here), that revenue likely isn’t going to materialise. So, just like OpenAI, Anthropic will need to plug that gaping hole in its books with investor funds.
The AI industry is no stranger to paying for catastrophic annual losses with investor cash. These AI labs and the ecosystem they live in have covered their losses for years through private equity sales and debt. But these sources of funds are beginning to dry up. Venture capital firms are struggling to raise enough capital to invest, their Big Tech backers are nearing the limit of how much they can invest, and the bond market is so saturated with risky AI debt that borrowing costs are getting too high. These sources of cash simply can’t provide them with enough funds to survive anymore. So, they need to turn to the only capital market they haven’t tapped into yet, retail investors, and to do that, they need to go public.
This is why SpaceX may have already popped the bubble, but we just don’t know it yet.
If SpaceX is responsible for OpenAI delaying its IPO until 2027, then it will be pushing it fatally close to bankruptcy, as it needed these funds yesterday. Being so close to death will make it nearly impossible to raise enough capital via an IPO. I can’t stress this enough: OpenAI delaying its IPO is effectively sealing its fate.
But what about Anthropic? If these rumours somehow turn out to be true and they too delay their IPO until 2027, then it’s the same problem. But here is the thing: because of the circular nature of AI, where the chip and compute suppliers fund the AI labs to buy their own products (also known as round-tripping), if OpenAI crashes out of this circle, the entire grift collapses. Not only that, but the collapse (or even perceived collapse) of OpenAI under its own financial idiocracy will cause a market correction and reassessment of the value of these companies. Both of these forces will choke Anthropic. They do not get out of this lightly at all.
Now, could something come along and save Altman and Amodei’s sorry arses? Yes. It’s no secret that Altman can see this car crash coming from a mile away and is basically begging Trump for a government bailout. We live in crazy, unprecedented times, so no cards are off the table, and wrenches are constantly thrown into the machine. Equally, Altman could still plough ahead with OpenAI’s IPO, or Anthropic could conduct an IPO earlier and do strangely well.
As I said, we don’t know how this will play out. Don’t try to time the market; it’s a fool’s game. But there are signs that SpaceX’s rocky IPO may create a domino effect and cause this bubble to pop. The fact that this is, at the very least, a possibility is not good news for the AI industry.
Thanks for reading! Everything expressed in this article is my opinion, and should not be taken as financial advice or accusations. Don’t forget to check out my YouTube channel for more from me, or Subscribe. Oh, and don’t forget to hit the share button below to get the word out!
Here's to Ed Zitron - evolved human being who hasn't needed to lie in order to feel good.
Maybe Sarah could ask Claude how to manage Anthropic’s horrendous financials. Or Grok. Or Alexis. Maybe Siri?