Google Discloses $94.1B in SpaceX Stock, Marking 6% Stake

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11vuio0pswjnm7 about 2 hours ago 56 commentsRead Article on wsj.com

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Discussion (56 Comments)Read Original on HackerNews

miohtama•21 minutes ago

This investment has never been secret.

Google (now under parent company Alphabet) invested roughly $900 million as the majority of a ~$1 billion funding round alongside Fidelity Investments. This gave Google an initial equity stake of about 7–7.5% in SpaceX at a valuation of roughly $10–12 billion.

matwood•13 minutes ago

Remember this was also when SpaceX was actually about space, instead of mostly AI and Twitter. Long-term shareholders that were sold on the space, have to be thinking about how to get out once their lockups expire.

miohtama•5 minutes ago

SpaceX, like Tesla, has always been about Elon Musk.

Investors are buying Musk, like they were buying Warren Buffett with Berkshire Hathaway. Long-term shareholders are not buying space; they are buying Musk. This has been clear to everyone since the beginning; it has been well communicated (look at SpaceX governance rules in Texas), and there is nothing mystical about it.

It's very likely Musk will roll everything up into a single Musk conglomerate.

throwaw12•about 1 hour ago

100x return, I would sell immediately after this kind of gain, maybe that's why I am not a Google

rf15•about 1 hour ago

I'm sure at an $80 valuation they will tell everyone how it's time to buy as it slides down further

knodi•28 minutes ago

Average pre-ipo sale price is $6.xx

rsynnott•38 minutes ago

Per the article, they can’t, yet.

sidcool•44 minutes ago

There would be some laws in place. And it would also stress the relationship with Elon.

ajross•about 1 hour ago

This is a micro/macro mistake. You obviously can't dump a 6% stake at strike price on Robinhood.

"The Market", at this scale, means "You find the buyer(s) yourself and work up the deal with a hundred lawyers and PR staff and hope the contract negotiation stays secret".

TheAtomic•22 minutes ago

Actually, that's the service provided by GS, etc. They have those buyers on the other side of their Rolodex.

hiddencost•44 minutes ago

(1) there's a lock out, they can't legally (2) Moving that kind of volume at market price is extremely difficult (3) This disclosure was required by law as part of their earnings. They would rather have said nothing and quietly offloaded it.

One consequence of booking the revenue is that they're going to have to report a loss when they sell it.

It's possible there's some tax shenanigans at play (idk): report the profit, mark it against their massive AI capex, sell later when they can book a loss. (I'm not sure if it works that way, it wouldn't for an individual, but maybe they can find a way to trigger a stepped up basis.)

embedding-shape•about 1 hour ago

Feeling sated and not constant greed is no way to build billionaires, nope.

tonyhart7•28 minutes ago

if you are big company like google, another 100 billion is not gonna make you feel better since cold cash is liability at that scale

100 billion is nothing if that money can put you in better spot at technology landscape

grim_io•24 minutes ago

6% is more than all of the issued IPO shares. They were 5%, right?

bombcar•22 minutes ago

What’s that in data centers?

dfasifsaf•10 minutes ago

ur-whale•about 2 hours ago

https://archive.ph/kQtHB

the__alchemist•about 1 hour ago

I am short both Google and SpaceX RN; SpaceX's IPO smells foul. Google is an AI-bubble short; Anthropic and OpenAI haven't IPOed yet.

chasd00•4 minutes ago

Maybe you’re right but, man, there’s easier money to be made than betting against those two companies.

nubg•2 minutes ago

Like?

matwood•18 minutes ago

Not sure why you'd short Google. Their business was doing great pre-AI, and will likely do great regardless of what happens to AI. The rumors of their demise when AI hit the scene were clearly greatly exaggerated.

next_xibalba•13 minutes ago

There is quite a bit of information out there as to how Google is achieving short term growth in their core search business. And boy, it is ugly. It does not signal long term continued growth.

throwaw12•34 minutes ago

from your list, I think only Google has moat and something I would short least.

Google has hardware, software ecosystem, mobile ecosystem, controls browser, has access to 2B+ users, has talent to come up with ideas - perfect spot for AI

conartist6•31 minutes ago

Now Microsoft, them I'd short. In a way I have by starting my own company to undermine their various competitive advantages comprehensively

jeremyjh•24 minutes ago

Microsoft has many of the same advantages but is incapable of judging the quality of the products it makes.

matwood•17 minutes ago

The number of companies that default to using Teams shows why MSFT isn't going anywhere.

the__alchemist•21 minutes ago

Concur; I am shorting them as well. Your approach is more clever!

onlypostonce•10 minutes ago

Wow why has nobody thought of this /s

hahahaa•39 minutes ago

Short Google? Early is wrong you know?

IAmGraydon•17 minutes ago

That’s a pretty weird take considering they’re down 21% in the last 2 months. How, exactly, is this early?

Rover222•11 minutes ago

SpaceX near $100/share is a great long position now, IMO.

deadbabe•19 minutes ago

Google is not a good short. They are actually one of the companies that will likely come out on top when the AI-bubble has popped.

Anthropic and OpenAI though will likely be dead, killed by cheap open weight LLMs and local LLMs.

rubyfan•about 1 hour ago

Didn’t they just raise $85B “for AI”?

brainwad•37 minutes ago

It's not like they can sell the SPCX stock. It's still locked up.

outside1234•about 1 hour ago

Hopefully they made this investment pre-IPO at some vastly lower valuation because otherwise… …this is a not going to end well for them.

jddj•about 1 hour ago

They got in at a ~12B valuation. They'll be fine

Aboutplants•about 1 hour ago

If true then they paid under $800 Million for their 6%, now valued at $94 Billion.

dagaci•about 1 hour ago

Yes, google they paid $900 millions in 2015 for about 7% stake, 100X. % Number probably fell because of all the "merging".

carlosjobim•about 1 hour ago

Why? They will still have their same stake no matter what happens with the stock price.

alfiedotwtf•about 2 hours ago

FIFY: Google discloses $94B loss

minraws•about 1 hour ago

They didn't invest 94B$

But yes the stock could go down much further and I hope they are willing to show the losses if they can show this as gains today.

Imagine the next call being about how their 95$B went to sub 30B$..

Will that be a negative line item. I don't see the point in disclosing this stake as earnings.

But I do get that accounting was made as a tool for companies to show off.

HFguy•14 minutes ago

Accounting goes back thousands of years. It was not made as a tool to show off. Lesson is more that tools can be abused for other purposes than intended.

consensus1•24 minutes ago

They don't have to be willing because hiding the losses would be a crime. And it still doesn't matter b/c anyone with a calculator can tell you exactly what the value of their position is on any given day. The $94 billion is 2.4% of Google's market cap, so even if SpaceX goes to zero it will be barely noticeable from the background noise of the stock price movement.

locallost•about 1 hour ago

It will be difficult since they acquired it for less than a billion 10 years ago.

https://www.theguardian.com/science/2015/jan/20/spacex-fundi...

passwordoops•about 1 hour ago

"The company’s marketable equity securities include $80 billion in shares subject to short-term restrictions and $14.1 billion subject to long-term restrictions"

Actually more like $14.1 and whatever value the other $80 is worth when they sell. Which is probably going to be worth well North of whatever is lost on the $14.1 B long-term... All part of the scam to inflate the value of the AI bubble

newsclues•about 1 hour ago

hate makes people stupid.

formvoltron•about 1 hour ago

exactly. amazing what sort of showman Musk is. Didn't he sleep with Brin's girlfriend at one time?

kennywinker•about 1 hour ago

Idk, but he sure did try to get invited to Epstein’s island to “party”.

minton•about 1 hour ago

Terrible! Source?