SpaceX (SPCX) Shares Plunge 8% as Musk Refutes AI Smartphone Claims

Key Highlights

• Elon Musk rejected a Wall Street Journal story regarding a SpaceX AI smartphone as “utterly false” via social media platform X
• Shares of SPCX declined 7.8% during Wednesday’s trading session after the CEO’s rebuttal
• According to the WSJ piece, the alleged device featured a proprietary operating system, xAI integration, and Qualcomm Snapdragon processors
• SpaceX shares have surrendered the majority of post-IPO momentum and currently trade 2.1% below their listing price
• Wall Street maintains a Moderate Buy consensus on SPCX with a $216.83 mean price objective, suggesting 37.6% potential appreciation

Shares of SpaceX (SPCX) tumbled 7.8% during Wednesday’s session following Elon Musk’s emphatic rejection of a Wall Street Journal article that alleged the aerospace company had been presenting an AI-enabled smartphone prototype to prospective investors before going public.

Space Exploration Technologies Corp., SPCX

Musk’s rebuttal on X consisted of just two words: “Utterly false.” The CEO offered no additional context or clarification.

According to the WSJ article, which cited anonymous sources with knowledge of the situation, the prototype handset operated on a custom-built operating system, incorporated artificial intelligence capabilities from xAI, and utilized Qualcomm’s Snapdragon chip architecture. The story temporarily boosted QCOM shares before Musk’s denial sent them down 1.55%.

The purported device was characterized as having a more refined design than Apple’s iPhone. The WSJ further indicated that the initiative remained in preliminary development phases and might ultimately be abandoned.

This marks another instance where SpaceX smartphone speculation has surfaced publicly. Reuters published a report in February suggesting SpaceX was investigating a mobile handset that would connect to its Starlink satellite infrastructure. Musk refuted those claims as well.

Months earlier in January, Musk had provided a somewhat ambiguous response, acknowledging that a Starlink-connected phone was “not out of the question at some point” — though he emphasized it would differ substantially from conventional smartphones.

SpaceX’s Expanding AI Ambitions

The smartphone narrative fits within SpaceX’s broader strategic vision. The company has committed billions of dollars toward expansion efforts that extend far beyond rocket manufacturing and Starlink connectivity services. SpaceX is developing AI infrastructure, embedding xAI’s Grok artificial intelligence model throughout its operational framework, and investigating orbital data center concepts.

The overarching objective appears to be establishing SpaceX as a formidable competitor in the artificial intelligence sector — not merely a spaceflight enterprise.

Reuters additionally disclosed that SpaceX is examining possibilities for launching its own mobile telecommunications network, and has entered discussions with Charter Communications regarding utilization of its terrestrial infrastructure for cellular traffic. The company previously established a direct-to-cell partnership with T-Mobile utilizing Starlink technology.

Current Stock Performance

SPCX has experienced challenging trading conditions recently. The equity now trades 2.1% beneath its IPO debut price, having relinquished most of the initial post-listing appreciation.

According to TipRanks data, SPCX maintains a Moderate Buy consensus recommendation derived from four Buy ratings, three Hold ratings, and one Sell rating. The average analyst price objective stands at $216.83, implying 37.6% potential upside from present trading levels.

Qualcomm shares retreated 1.55% in response to the report. Both SpaceX and Qualcomm representatives declined to provide statements to Reuters.

Microsoft introduced its own AI-equipped badge device for enterprise users last month, which also incorporates Qualcomm wearable chip technology — underscoring the increasingly competitive landscape within AI-powered hardware markets.

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