S&P Dow Jones Indices has removed the S&P 500 from SpaceX’s first-year demand story, keeping passive funds from becoming forced buyers of the rocket and satellite company immediately after a potential listing.
The decision is less about SpaceX’s size than about who gets to command index-linked money. SpaceX is reportedly seeking a Nasdaq IPO that could raise $75 billion at a $1.75 trillion valuation, according to Reuters, but S&P said megacap status alone will not override its core entry screens for flagship US benchmarks.
That blocks the cleanest path to a major passive-flow event. ZeroHedge said the decision delays about $14 billion in potential passive inflows by at least a year.
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After a market consultation, the index provider said it would not change the financial viability, IPO seasoning or minimum investable weight factor rules for the S&P 500, S&P MidCap 400 and S&P SmallCap 600 solely for companies with very large market capitalizations. S&P said the existing methodology still gives the indices broad market coverage while preserving consistency in index construction.
The choke point is profitability and time as a public company. S&P’s financial viability screen generally requires positive GAAP earnings in the latest quarter and over the combined prior four quarters. Reuters reported that SpaceX generated $18.67 billion in 2025 revenue, up 33%, but still posted a $4.94 billion net loss.
S&P had considered a more flexible system. Its April consultation asked market participants whether large newly listed companies should receive limited exceptions, including cutting the public-trading history requirement from 12 months to six months and adjusting other eligibility screens for megacaps. The review was framed around whether the indices could remain representative as more giant private companies prepare to enter public markets.
The final answer split the market. S&P kept the stricter rules for its headline benchmarks but changed treatment for broader indices. Companies that meet updated criteria may qualify more quickly for the S&P Total Market Index, S&P Completion Index and Dow Jones US Total Stock Market Index. Those changes take effect before trading opens on June 8, 2026.
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