Kathy Wood is shifting her eggs from the Tesla basket to the SpaceX basket: an aggressive entry on IPO day.
On the day of SpaceX's long-awaited public market debut, Cathie Wood, founder and CEO of ARK Invest, made a decisive strategic move. Her flagship fund purchased approximately $529.7 million worth of SpaceX (SPCX) shares, while simultaneously reducing its stake in Tesla. Both companies are owned by Elon Musk, but Wood's priorities have shifted from the established automotive giant to the space pioneer.
Deal of the Day: $444 Million in IPO and Tesla Reduction
The trades were executed on June 12, the day SpaceX officially went public. ARK acquired 3.29 million shares at the offering price of $135 per share. By the close of the trading session, the stake was worth $529.7 million — a 19% increase in a single day. On the same day, the fund cut its positions in Tesla, as well as in Advanced Micro Devices, Rocket Lab, Roku, and Baidu.
For context: Tesla has long been a cornerstone of the ARK portfolio, and Wood publicly defended the company during its most challenging times. However, the situation has changed. Chinese competitors have nearly caught up with Tesla, its profitability is declining, and Musk's political activity is alienating some consumers. On the other hand, SpaceX, and especially its satellite internet Starlink, is demonstrating explosive growth.
SpaceX: ARK's New Main Bet
Wood first invested in SpaceX back in late 2023, and since then, the company has become the largest position in ARK's venture portfolio (approximately $1 billion). Now, with the public market listing, the fund can increase its investments without the limitations typical of private investments.
It is worth noting that, despite the optimism, SpaceX is not yet profitable. As of March 31, the company's cumulative loss stood at $41.3 billion. However, 30% of the offering was allocated to retail investors — three to six times higher than the usual level, indicating strong demand and confidence in the business.
ARK's Return Context: Is a "Lifeline" Needed?
Wood's decision to shift capital from Tesla to SpaceX appears to be an attempt to find a new growth point for her fund. Since the beginning of the year, the ARK Innovation ETF has risen only 1.61%, while the S&P 500 has gained about 9%. Over the past 12 months, investors have withdrawn approximately $294 million in net funds from the fund. According to Morningstar estimates, from 2014 to 2024, ARK "destroyed" about $7 billion of its investors' funds.
Wood operates on a single playbook: enter promising companies as early as possible. This was the case with Coinbase after its listing in 2021, recently with CoreWeave, and now with SpaceX. The only question is whether SpaceX will live up to expectations and allow for consistent profits, or whether it will become another costly mistake.
Analytical Commentary from Cryptalist: The capital flow from Tesla to SpaceX is not just diversification, but a clear signal to the market: Wood is betting on a future where space infrastructure and satellite internet become the new "oil wells" of the 21st century. Tesla, despite its achievements, can no longer offer the same exponential growth. The question is whether SpaceX, with all its losses, can transform into a generator of stable profits, or whether ARK investors will once again pay for faith in a big name.