Key Takeaways
- Elon Musk dismissed a Wall Street Journal article regarding a SpaceX AI smartphone as “utterly false” via his X platform
- Shares of SPCX declined 7.8% Wednesday in response to the CEO’s rebuttal
- The original WSJ article suggested the handset operated on proprietary software, incorporated xAI capabilities, and utilized Qualcomm Snapdragon processors
- SPCX shares have surrendered the majority of their initial IPO momentum and now trade 2.1% below their listing price
- Wall Street analysts maintain a Moderate Buy stance on SPCX with a consensus price target of $216.83, suggesting 37.6% potential appreciation
Shares of SpaceX (SPCX) tumbled 7.8% during Wednesday’s trading session after CEO Elon Musk categorically rejected a Wall Street Journal article that suggested the aerospace company had demonstrated an AI-equipped smartphone prototype to potential investors prior to going public.
Space Exploration Technologies Corp., SPCX
Musk’s rebuttal on the X platform consisted of just two words: “Utterly false.” The CEO offered no additional context or clarification.
According to the Wall Street Journal’s reporting, which cited anonymous sources with knowledge of the situation, the alleged prototype operated on a custom-built operating system, featured artificial intelligence capabilities from xAI, and was powered by Qualcomm’s Snapdragon chipsets. The initial report temporarily boosted QCOM shares before Musk’s contradiction caused them to retreat 1.55%.
The purported device was characterized as having a more refined design than Apple’s iPhone. The Journal’s sources indicated the initiative remained in preliminary phases and might ultimately be abandoned.
Speculation surrounding a SpaceX smartphone isn’t entirely new. Reuters published a report in February suggesting SpaceX was investigating the development of a mobile handset linked to its Starlink satellite constellation. Musk rejected those claims as well.
Earlier in January, Musk had been somewhat more ambiguous, stating that a Starlink-connected phone wasn’t entirely “out of the question at some point” — though he emphasized it would differ substantially from conventional smartphones.
SpaceX’s Expanding AI Ambitions
The smartphone speculation exists within SpaceX’s broader strategic vision. The company has been investing billions of dollars to expand far beyond its core rocket launch operations and Starlink internet services. SpaceX is developing robust AI infrastructure, embedding xAI’s Grok language model throughout its operational framework, and investigating orbital data center possibilities.
The overarching strategy appears focused on establishing SpaceX as a formidable competitor in the artificial intelligence sector — transcending its identity as purely a space exploration enterprise.
Reuters has also disclosed that SpaceX is examining opportunities to launch its own mobile telecommunications network, with ongoing discussions involving Charter Communications regarding the utilization of terrestrial infrastructure for cellular traffic. The company previously established a direct-to-cellular partnership with T-Mobile via its Starlink platform.
Current Stock Performance Analysis
SPCX has experienced challenging market conditions recently. The equity now trades 2.1% beneath its initial public offering price, having relinquished most of the enthusiasm that followed its market debut.
According to TipRanks analysis, SPCX currently carries a Moderate Buy consensus recommendation derived from four Buy ratings, three Hold ratings, and one Sell rating. The consensus price objective stands at $216.83, implying potential upside of 37.6% from present trading levels.
Qualcomm shares retreated 1.55% following the initial report. Both SpaceX and Qualcomm representatives declined to provide statements to Reuters regarding the matter.
Microsoft recently introduced its own AI-enhanced wearable badge for enterprise employees, which also incorporates Qualcomm wearable processors — underscoring the increasingly competitive nature of the AI hardware marketplace.
