SpaceX aborts Starship V3 launch as engine failure pressures post-IPO stock
The abrupt halt of SpaceX’s latest Starship test flight has intensified investor scrutiny on the company’s post-IPO valuation and its reliance on the profitable Starlink division to justify its market capitalisation.
SpaceX halted the second test launch of its upgraded Starship V3 rocket on Thursday, moments after the booster ignited at its South Texas facility. Chief executive Elon Musk stated on X that “[s]ome of the engines didn’t start, triggering an automatic launch abort”.
Broadcast graphics indicated that four of the new Raptor engines failed to fire upon ignition. The company must now safely remove all propellant from both the Super Heavy booster and the upper stage to investigate the root cause. Musk confirmed that two engines will be replaced, with the next launch attempt targeted for next week.
The mission was intended to deploy the first third-generation Starlink satellites. These specific payloads are designed to burn up approximately 20 minutes after deployment, as the vehicle has not yet proven its capacity to reach Earth orbit.
Successfully launching these upgraded satellites is critical for SpaceX. It represents a necessary step to demonstrate the technological and economic viability of the company’s ambitious "orbital data centers" concept.
This technical setback arrives at a highly sensitive moment for the company’s financial markets standing. SpaceX went public on 12 June in what was billed as the largest initial public offering in history, raising more than $85 billion. At its peak, the listing briefly matched the valuations of tech giants Amazon and Microsoft.
However, investor enthusiasm has waned steadily over the past month. On Thursday, SpaceX shares closed below their $135 IPO price. Following the aborted launch, the stock sank more than 4 per cent in after-hours trading, reflecting growing market anxiety over execution risks.
The pressure is compounded by the fact that Starlink remains the largest revenue generator and the only profitable segment of SpaceX’s broader business. Any delay in upgrading this satellite constellation directly impacts the financial engine subsidising the company’s heavier developmental rockets.
Thursday’s attempt was meant to build on the first Starship V3 launch in May, which yielded mixed results. While that mission successfully deployed Starlink simulators, the Super Heavy booster suffered a failure prior to a simulated Gulf of Mexico landing.
That May incident prompted a mandatory review by the Federal Aviation Administration. Although the upper stage also lost an engine during that flight, it managed a simulated water landing successfully. The FAA only cleared SpaceX to resume flights earlier this week after the company implemented specific fixes for the previous booster failure.
