After weeks of intense selling pressure that erased hundreds of billions of dollars in market value, Tesla and SpaceX are showing the first signs of stabilization.
Both companies posted modest gains as investors responded to improving sentiment surrounding SpaceX’s first earnings report as a public company and renewed optimism about Elon Musk’s long-term artificial intelligence strategy. While neither stock has recovered a meaningful portion of its recent losses, the rebound suggests investors are beginning to reassess valuations following one of the sharpest declines ever experienced by Musk’s business empire.
SpaceX Earnings Ease Investor Concerns
The biggest catalyst came from SpaceX’s inaugural quarterly earnings report since its IPO.
Although the company reported a quarterly loss of US$541 million, the result was substantially better than Wall Street had expected. Revenue continued to grow, supported by the expanding Starlink business, while investors welcomed management’s outlook for improving profitability later this year. Following the earnings release, SpaceX shares rose roughly 8%, recovering part of the steep decline that had followed the company’s public debut.
Despite the rebound, SpaceX remains well below its post-IPO peak, reflecting continued investor caution over valuation, future capital spending and the upcoming expiration of insider lock-up restrictions.
Tesla Also Moves Higher
Tesla shares also participated in the recovery, climbing approximately 1.8% after six consecutive sessions of losses.
The rebound comes even as investors continue to evaluate the company’s slower-than-expected progress in autonomous driving, robotaxis and AI initiatives. Analysts note that stronger sentiment surrounding SpaceX could indirectly benefit Tesla because the two companies increasingly collaborate on artificial intelligence, semiconductor development and infrastructure projects.
While the move higher is relatively modest, it represents a welcome change following weeks of heavy selling pressure.
The Bigger Picture Hasn’t Changed
Even with the recent gains, both companies remain significantly below their recent highs.
SpaceX has lost a substantial portion of its market value since its June IPO, while Tesla continues trading well below levels seen earlier this year. Investors remain focused on several key catalysts, including Starship’s progress, Tesla’s AI roadmap, Optimus humanoid robots and the expansion of autonomous transportation services.
These long-term initiatives continue to underpin much of the valuation investors assign to Elon Musk’s companies.
Why It Matters
The recent rebound does not necessarily signal the end of the correction.
Instead, it highlights how quickly sentiment can shift around companies whose valuations are closely tied to future technological breakthroughs rather than current financial performance.
For Tesla and SpaceX, upcoming earnings, AI developments and execution on ambitious long-term projects will likely determine whether this recovery becomes the start of a sustained turnaround—or simply a pause after one of the most dramatic selloffs in recent market history.
