SpaceX faces lengthy wait for S&P 500 inclusion after rules change rejection

S&P Dow Jones Indices refused to relax profitability requirements, pushing SpaceX's earliest eligibility to mid-2027 and stranding billions in passive fund inflows.

Share

Add us on Google by Editorial Team Jun. 7, 2026

SpaceX was supposed to rocket into the S&P 500 shortly after its anticipated June 2026 IPO. Instead, it’s looking at a minimum one-year wait in the penalty box, thanks to the index’s gatekeeper refusing to bend the rules for mega-cap newcomers.

S&P Dow Jones Indices announced on June 4 that it would keep its existing eligibility criteria intact for the S&P 500 and other major indexes. The decision came after a formal consultation process that explored whether mega-cap IPOs deserved a faster track into the index.

The profitability problem

Here’s the thing about the S&P 500: you can’t just be big. You have to be profitable. The index requires GAAP profitability in the most recent quarter plus positive cumulative earnings over the trailing four quarters. It also mandates a 12-month public trading history and a minimum investable weight factor of 10%.

SpaceX clears the “big” bar with ease, but the profitability requirement is where things get uncomfortable. The company reported a net loss of $4.94 billion against $18.67 billion in revenue for 2025.

Advertisement

With the existing rules unchanged, SpaceX’s earliest possible eligibility now shifts to June 2027. And that timeline assumes the company actually turns profitable in the interim, which is far from guaranteed. Analyst projections suggest SpaceX may not hit profitability until sometime in 2027, meaning even the June 2027 window could slip further.

$14 billion left on the table

The financial stakes here are not trivial. Estimated passive fund inflows tied to SpaceX’s anticipated S&P 500 inclusion total roughly $14 billion. That’s the amount of money that index-tracking funds, ETFs, and passive strategies would essentially be forced to allocate to SpaceX shares once it joins the benchmark.

Deferring that $14 billion demand shock by at least a year has real consequences. It could dampen enthusiasm around SpaceX’s IPO pricing, since some investors were likely factoring in near-term index inclusion as part of their valuation thesis.

It’s worth noting that rival indexes have already moved in the opposite direction. The Nasdaq-100 and Russell 1000/2000 have adjusted their rules to allow faster entry for mega-cap IPOs. So SpaceX could find itself in the somewhat awkward position of being included in the Nasdaq-100 while being excluded from the S&P 500.

Bigger than SpaceX

This decision extends well beyond Elon Musk’s rocket company. OpenAI and Anthropic are the most obvious examples of large companies burning cash at significant rates while generating substantial revenue. If they go public in the next year or two, they’ll face the same S&P 500 eligibility wall that SpaceX just hit.

What this means for investors

For anyone planning to invest in SpaceX’s IPO, the calculus just changed. The near-term index inclusion premium that would have supported the stock’s valuation is gone.

The divergence between index rules also creates an interesting opportunity for portfolio construction. If SpaceX gets added to the Nasdaq-100 but not the S&P 500, funds tracking those two benchmarks will have meaningfully different exposure to one of the most closely watched companies in the world.

Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.