SpaceX May Spin Off Its Starlink Business To Pursue An IPO Reportedly Until 2025 Or Later

SpaceX may spin off its Starlink broadband business and pursue an IPO (Initial Public Offering), reportedly until 2025 or later. SpaceX founder and CEO Elon Musk said that Starlink could become a publicly traded company during an employee meeting on June 2nd. “I’m not sure exactly when that [IPO] is, but maybe it will be like — I don’t know, just guessing — three or four years from now,” Musk told employees last week, according to a CNBC report. 

Last year, Musk teased the potential of making Starlink a publicly traded company to allow SpaceX supporters to invest in the company. "Once we can predict cash flow reasonably well, Starlink will IPO," he wrote to a SpaceX fan via Twitter in February 2021. 

Once we can predict cash flow reasonably well, Starlink will IPO

— Elon Musk (@elonmusk) February 9, 2021

Musk said that if Starlink goes public he would like to give first access to ‘small retail investors.’ "We will probably IPO Starlink, but only several years in the future when revenue growth is smooth & predictable. Public market does *not* like erratic cash flow haha. I’m a huge fan of small retail investors. Will make sure they get top priority. You can hold me to it," Musk said in September 2020, in response to a Twitter user who said they would ‘love to invest in the future.’ “Going public sooner than that would be very painful. Will do my best to give long-term Tesla shareholders preference,” Musk added. Having predictable cash flow is necessary to ensure the broadband network’s success.  

We will probably IPO Starlink, but only several years in the future when revenue growth is smooth & predictable. Public market does *not* like erratic cash flow haha. I’m a huge fan of small retail investors. Will make sure they get top priority. You can hold me to it.

— Elon Musk (@elonmusk) September 28, 2020

The Starlink broadband division is expected to generate more revenue than SpaceX's rocket launch services. During the Satellite2020 conference, Musk said that if Starlink is successful in the global telecommunications market, it could net $30 billion to $50 billion in revenue annually. “The whole purpose of SpaceX is really to help make life multi-planetary... But the revenue potential of launching satellites to the space station… taps out about $3 billion dollars a year. But I think providing broadband is more like an order of magnitude more than that, probably $30 billion a year as a rough approximation,” he said. 

SpaceX already has nearly 500,000 Starlink Internet subscribers living across 32 countries. The company increased the Starlink hardware cost and internet service fee in May "due to excessive levels of inflation." The Starlink user terminal currently costs $599 USD with a monthly internet subscription of $110 USD, which generates approximately over $500 million a year. SpaceX still needs to complete launching at least 12,000 Starlink satellites to build a robust internet network capable of providing Internet service to more users globally. To date, the company has launched around 2,600 satellites to Low Earth Orbit. 

Featured Image Source: SpaceX Starlink.com