Analysis: SpaceX IPO may become a "financing tool" for Tesla, financial rationale and profitability remain questionable

Odaily reported that market analysis indicates that if Musk's proposed merger between SpaceX and Tesla is implemented, SpaceX may need to issue new shares equivalent to 94% of its current outstanding shares to acquire Tesla, bringing the total shares to about 8 billion. However, the financial logic of the transaction faces challenges: Tesla's GAAP net income over the past 12 months has fallen from $15 billion in 2023 to $3.9 billion. After excluding regulatory credit revenue and Bitcoin gains, core operating profit is only about $2.3 billion.

Analysts believe the essence of this deal may be using highly-valued assets to acquire another company with similarly high valuation, and its long-term profitability and cash flow performance remain highly uncertain. The post-merger company valuation could reach $3.4 trillion, with SpaceX estimated at $1.75 trillion and Tesla currently valued at about $1.65 trillion. Musk may leverage SpaceX’s upcoming IPO, which will generate a high valuation, to support Tesla as it faces performance pressures. (Fortune)