Elon Musk just turned his AI company into rocket fuel. SpaceX has filed for what is expected to be the largest initial public offering in history, targeting a valuation of $1.75 trillion. The catalyst: a February 2026 merger with xAI, the AI startup behind the Grok chatbot, in a deal that valued SpaceX at $1 trillion and xAI at $250 billion.

The Los Angeles Times reports the IPO could raise as much as $75 billion this summer. To put that in perspective, the previous record IPO was Saudi Aramco at $29.4 billion in 2019. SpaceX is not just breaking the record. It is destroying it.

The merger math tells the real story. Starlink now has more than 10 million subscribers generating recurring revenue. xAI's Grok 4.1 just launched across all platforms with a 2 million token context window, a 65% reduction in hallucinations, and API pricing that undercuts OpenAI by a factor of 10. Combine a low-latency global satellite network with advanced AI models and you get something no other company on Earth can offer: orbital AI infrastructure.

That is not marketing language. That is the actual thesis. SpaceX can deliver AI compute to any location on the planet via satellite, bypassing the terrestrial data center bottleneck that every other AI company faces. It is the kind of vertical integration that makes investors lose their minds, and apparently they have. Reuters confirmed the $1 trillion SpaceX and $250 billion xAI valuations.

The timing is deliberate. Musk is taking SpaceX public while AI hype is at peak fever, while Starlink revenue is surging, and while NASA's Artemis program keeps SpaceX at the center of American space ambitions. It is the most perfectly engineered IPO window since Google went public in 2004.

The risks are real. Musk's DOGE work has made him politically radioactive in some circles. SpaceX's government contracts could become a liability if political winds shift. And xAI is competing against OpenAI, Anthropic, and Google with a fraction of their market share. But none of that matters if the IPO prices at anything close to $1.75 trillion. At that valuation, SpaceX would be worth more than every company in the world except Apple, Microsoft, and Nvidia.

Sam Altman raised $122 billion for OpenAI and thought he was winning the AI funding race. Musk just raised the entire company to $1.75 trillion and made the rest of the industry look like a Series A.

First reported by Reuters and the Los Angeles Times. Additional reporting by Observer and India Today.