Kathy Wood is reshuffling her portfolio: SpaceX becomes the top priority amid Tesla's weakening position
On June 12, the day of SpaceX's long-awaited initial public offering, Cathie Wood made a significant move. Her ARK fund purchased 3.29 million shares of SPCX at the offering price of $135, spending a total of approximately $444 million. By the close of the trading session, this stake was worth $529.7 million — a 19% increase in a single day. Simultaneously, Wood reduced her holdings in Tesla, as well as in Advanced Micro Devices, Rocket Lab, Roku, and Baidu.
This decision is not merely a tactical reshuffling. It reflects a fundamental shift in priorities. Tesla has long been the anchor of ARK's portfolio, and Wood publicly supported the company even during its toughest times. However, the situation has now changed dramatically. Chinese competitors have nearly caught up with Tesla, its profitability is declining, and Elon Musk's political activism is alienating some consumers. Against this backdrop, SpaceX appears to be a much more promising asset.
SpaceX's only profitable segment — Starlink satellite internet — is experiencing explosive growth. Wood first invested in SpaceX back in late 2023, and the company has now become the largest position in ARK's venture portfolio (approximately $1 billion). Now, after the IPO, the fund can increase its investments on the public market.
Context of ARK's Returns
Since the beginning of the year, the ARK Innovation ETF has grown by only 1.61%, while the S&P 500 has gained about 9%. Over the past 12 months, investors have withdrawn a net total of approximately $294 million from it. According to Morningstar estimates, from 2014 to 2024, ARK "destroyed" about $7 billion of its investors' funds. Against this backdrop, the bet on SpaceX looks like an attempt to reverse the trend.
Wood follows a single playbook: enter promising companies as early as possible. This was the case with Coinbase in 2021 and with CoreWeave recently. Now, SpaceX has become the largest investment. Whether the company will achieve stable profitability and allow ARK to generate returns — or whether it will become another costly mistake — only time will tell.
Analytical conclusion: The capital shift from Tesla to SpaceX signals to the market that even Elon Musk's most loyal supporters are beginning to doubt the long-term sustainability of his automotive business. SpaceX, on the other hand, possesses a unique competitive advantage in the space industry, and Wood's early entry could prove to be one of her most successful decisions in recent years. However, the high valuation and the company's unprofitability carry significant risks.