Elon Musk, the CEO of Space Exploration Technologies Corp., has refuted reports that his company is developing a handheld AI device. Musk took to X to respond to the claims, labeling them as "utterly false." The denial follows a published report suggesting SpaceX had presented investors with a prototype of a device similar to Apple Inc.'s iPhone, though the original post regarding the report was later deleted.

The disputed report, published by the Wall Street Journal on Wednesday, indicated that the device would be "slimmer" than an iPhone and run on SpaceX’s proprietary system using AI technology from xAI. It further claimed the device would include chips from Qualcomm Inc. However, the report noted the device was still in the prototype phase with no official name, and it remained unclear if it would ever be released to the public.

Earlier this year, Musk stated a Starlink phone was "not out of the question" and could be AI-optimized, but he later clarified that SpaceX is not developing a smartphone. The recent report emerged after SpaceX President Gwynne Shotwell reportedly informed investors last month about plans to launch a Starlink retail product for U.S. consumers and build its own terrestrial mobile network.

Analyst Perspectives on Market Entry

Analysts hold differing views on SpaceX's potential strategy in the wireless sector. An analyst at TD Cowen predicted that SpaceX could pursue an acquisition of T-Mobile US Inc. to expand its wireless ambitions. This move would leverage the existing Starlink partnership and target the growing mobile connectivity market. In its IPO filing, SpaceX estimated a $740 billion addressable market for Starlink Mobile, signaling plans to compete with carriers such as Verizon Communications and AT&T.

Conversely, analysts at Vital Knowledge expressed skepticism regarding SpaceX's ability to scale consumer device manufacturing and compete with established platforms. The firm argued that Musk's companies often receive generous valuations based on ambitious product promises rather than proven consumer products, noting it is "hard to imagine SpaceX becoming a force in consumer electronics."

Recent Stock Performance

Since its debut on June 12, SpaceX stock has declined 2.12%. On Wednesday, the stock fell 7.80% to close at $157.54.

Wedbush has initiated coverage of Space Exploration Technologies Corp. with an Outperform rating and a $190 price target, arguing the Elon Musk-led firm is emerging as a dominant AI infrastructure play. The firm’s “sum of the parts” valuation implies an enterprise value of approximately $2.48 trillion based on FY28 estimates, driven by a powerful “demand flywheel” in its Starship launches and Colossus clusters. This bullish outlook arrives as the stock prepares for significant passive capital inflows ahead of its inclusion in the Nasdaq-100 Index on July 7.

Dan Ives, Wedbush’s Global Head of Tech Research, emphasized that Space Exploration Technologies Corp. should be viewed as a vertically integrated platform across connectivity, launch, and AI rather than a traditional space business. He identified the Starlink satellite network, backed by 12 million global subscribers, as the primary profitability driver. While acknowledging the stock looks expensive based on current revenue, Ives stated that execution over the next two to three years could redefine the company’s market position.

“If they execute, I could argue this becomes one of the best AI plays in the market,” Ives said. “That’s why we are bullish here. I think you got to see around the corner, rather than just looking at valuation over the next six to 12 months.”

Valuation Debate

The aggressive valuation has sparked skepticism on Wall Street. Evercore founder and senior chairman Roger Altman warned that traditional models struggle to value Space Exploration Technologies Corp. and IPO-bound Anthropic due to their unprecedented scale and uncertain long-term cash flows. “I don’t think anybody understands, at least I don’t, how to value companies like SpaceX or Anthropic,” Altman stated. Third Bridge sector analyst John Conca also cautioned that aggressive multi-year subscriber projections are “unrealistic” due to near-term capacity constraints.

Recent Stock Performance

Shares of Space Exploration Technologies Corp. have gained 13.91% since their listing on June 12. The stock rose 4.06% to close at $170.86 on Tuesday and was up 1.84% in premarket trading on Wednesday.