{"text":[[{"start":4.25,"text":"When valuing a stock, it is hard enough to work out how many sports cars, aeroplanes or pairs of jeans the world will want years from now. But how about estimating the cash flows from putting a million humans on Mars?"}],[{"start":17.35,"text":"Elon Musk’s SpaceX, which filed for an initial public offering on Wednesday, presents investors with that puzzle. Its finances today are of no use in working out what the company is worth. At the valuation of $1.75tn previously reported by the FT, SpaceX would be the US stock market’s seventh-biggest company; but ranked by its revenue of $19bn a year, it would be 200th, on a par with Lucky Charms cereal maker General Mills."}],[{"start":45.75,"text":"Investors must therefore make assumptions about a business whose mission is to “extend the light of consciousness to the stars”. SpaceX’s three parts are its satellite communications business Starlink, which makes up most of the group’s revenue and is already profitable; a space division, which is small and lossmaking; and an even more lossmaking AI segment, which includes social network X and some enormous data centres."}],[{"start":71.5,"text":"Analysts will no doubt try to value each part separately using elaborate models. But given growing losses, its pedestrian 15 per cent revenue growth and the challenge of appraising activities that don’t yet exist — such as commercial asteroid mining and space tourism — estimates could range widely. Target valuations for Musk’s other company, the $1.2tn Tesla, already range from $500bn to $2.2tn among sell-side banks."}],[{"start":null,"text":"
"}],[{"start":101.35,"text":"A different approach for SpaceX is to work backwards: take the mooted valuation and ask what would make it so. One clue lies in the $7.5tn market value at which Musk can claim a mammoth SpaceX stock bonus laid out in Wednesday’s filing. Imagine it takes him 10 years to get there, discount it back into a present-day sum at a rate of 15 per cent, and the company is indeed worth about $1.9tn."}],[{"start":126.8,"text":"Or think, as tech leaders are wont to do, about “total addressable market”. Musk sees a $28.5tn “actionable” opportunity for SpaceX. If a decade from now, the company is turning a third of revenue into earnings and trades at the same 30-times earnings that Apple, Amazon and Alphabet all do now, Lex calculates that the company would only need to capture 3 per cent of that total market to achieve its whispered market capitalisation."}],[{"start":154.1,"text":"One problem Musk faces is that while his interplanetary dream is grand, his financial vision is surprisingly prosaic. Almost 80 per cent of SpaceX’s targeted opportunity is “enterprise applications”, meaning software and services for big companies. That market is well served already, including by new entrants Anthropic and OpenAI, both also eyeing colossal IPOs. Anthropic’s quarterly revenue of $10.9bn is already double that of SpaceX."}],[{"start":184.45,"text":"Musk has thrown out some wild numbers over the years — he once suggested Tesla could be worth $100tn, with luck. Most attempts to value SpaceX will end up being both overly precise and incredibly vague. But the market has never before had to price a stock so speculative yet so large. With irrevocable control and every major Wall Street bank at his beck and call, for now, it’s worth whatever Musk says it is."}],[{"start":219.99999999999997,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1779403360_4917.mp3"}