The word “government” appears over and over in the IPO prospectus for Space Exploration Technologies Corp., the Elon Musk rocket company better known as SpaceX. There’s a good reason the word shows up so frequently in a document that details the history, financial performance and investment risks of this extraordinary enterprise: Without government, it wouldn’t exist.
Investors pondering whether to pay for a piece of the action this week — at the unheard-of initial public offering valuation of $1.77 trillion — would do well to consider how important governments are to SpaceX. That’s because Musk is adept at taking money from the public sector even as he disparages how it spends that money elsewhere. Through his brief tenure atop the U.S. DOGE Service — a name derived from a joke that grew into an agency that was anything but — Musk did more than perhaps any single individual in history to dismantle crucial functions of the U.S. government.
Not every mention of government in the SpaceX investor pamphlet refers to the U.S. government. SpaceX proudly sells access to its rocket-launch capabilities, Starlink satellite-based internet service and various artificial intelligence products to governments (and businesses) around the world.
A great thing about Securities and Exchange Commission requirements for companies that want to sell shares to the public is the information these previously private companies are required to disclose. SpaceX lays out for all to see just how important Washington is to its fortunes: “In 2025, approximately one-fifth of our revenue was attributable to agencies within the U.S. federal government.”
That means that contracts granted by the federal bureaucracy, the same one that Musk so thoroughly maligned in his DOGE days, accounted for about $3.75 billion of the company’s $18.7 billion in 2025 revenue.
This business was built up over many years, of course, particularly during a time when SpaceX provided a moribund NASA with a new generation of advanced-capability rockets. It was a time when there was nothing particularly partisan about expenditures on the space program.
But what if a future presidential administration or, more imminently, a Congress hostile to the chainsaw-wielding SpaceX CEO’s words and deeds were to sour on working with his pioneering company? SpaceX’s lawyers have considered that possibility. “Our business with governmental entities is subject to changes in policies, priorities, regulations, mandates, and funding levels, any of which could materially impact our operations and financial results,” SpaceX warns in the “risk factors” section of its prospectus.
It is altogether clear to SpaceX that Musk’s intemperate ways might not play well in the future. “If we fail to establish and maintain important relationships with U.S. government agencies, our ability to successfully maintain and develop new business could be materially and adversely affected,” it cautions, adding that the “current political environment in the United States is highly polarized, and shifts in the composition of the U.S. Congress or changes in the presidential administration can result in significant changes in government spending priorities.”
SpaceX’s federal business isn’t confined to NASA or the intelligence agencies. It boasts in its securities filing that its Starlink service contracts include supporting “FEMA in coordinating disaster recovery after hurricanes and wildfires” and “NOAA for at-sea testing and environmental monitoring.”
While the Federal Emergency Management Agency and the National Oceanic and Atmospheric Administration weren’t necessarily put through Musk’s wood chipper the way the U.S. Agency for International Development was, each was subjected to significant cuts — though apparently not to their contracts with SpaceX’s Starlink.
Building his companies on government funding is the norm for Musk. Tesla benefited from government subsidies for electric vehicles. The same was true of SolarCity, the Musk-controlled solar panel concern that Tesla absorbed a decade ago. Yes, Musk’s companies deserve credit for their innovative approaches. But without government funding of thoughtful policies, this innovation would have faced much higher hurdles coming to market.
Even with that support, the road ahead may not be easy. Investors may be surprised to know that SpaceX doesn’t make money overall: It lost $4.9 billion last year. And the valuation it seeks, in an unusual take-it-or-leave-it proposition, would price the company at more than 90 times its revenue, roughly 30 times the price-to-sales ratio for the overall S&P 500 index.
It will be up to investors to decide if a company that is reaching for the heavens deserves the astronomical stock-market valuation it is seeking. What is irrefutable is that SpaceX — and nearly every other business Musk has dreamed up — relies on government support, especially the financial largesse funded by taxpayers.
Musk’s entrepreneurial zeal and commercial accomplishments are to be celebrated. If only he were as charitable toward the governmental partners who helped him on his way.
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