Shares of SpaceX (SPCX) traded higher in early trading on Thursday as investors looked past the company’s first major IPO lock-up expiration, although analysts cautioned that the sharp increase in tradable shares could keep the stock volatile in the near term.

At the time of writing, were up nearly 3%.

Thursday marks the first opportunity for early investors to sell a portion of their holdings after SpaceX’s listing last month. More than 911 million shares became eligible for trading, representing about 6.9% of the company’s outstanding shares of 13.18 billion, according to Koyfin data. It also exceeds the 639 million shares sold during the initial public offering.

Lock-up periods prevent insiders from selling shares immediately after a public offering. Additional share releases are scheduled for December 2026 and June 2027.

SPCX Stock Is Likely To Be Volatile

Despite the stock’s gains, analysts have warned that the increased float could lead to volatility in the stock’s price.

ActivTrades analyst Carolane de Palmas told Reuters that some employees and early investors may choose to lock in profits or shift capital elsewhere. The analyst added that the larger supply of tradable shares could sustain volatility even if insider selling remains limited.

“Even without heavy selling, ⁠the ​increase in available shares is ​likely to keep volatility elevated,” Palmas said.

Rainmaker Securities co-founder Greg Martin told CNBC that the stock’s near-term performance is likely to be influenced more by the lock-up expiration than by the company’s underlying fundamentals.

AI Spending Keeps Investors Cautious

The stock slumped more than 13% in the previous session despite better-than-expected second-quarter results, as investors turned cautious over the firm’s massive AI capital expenditure.

SpaceX posted $7.81 billion in revenue, up 92% from a year earlier and well above the $6.82 billion expected by analysts, according to Fiscal.ai. However, capital spending soared, with SpaceX investing $15.8 billion in AI during the quarter to expand its Colossus II computing infrastructure, helping drive total capital expenditure to $18.4 billion.

On Thursday, the government of Texas announced that SpaceX plans to build a $16.8 billion, 100-million-square-foot semiconductor fabrication facility in Grimes County, a project expected to create 3,000 jobs.

Retail’s Take On SPCX

Retail sentiment surrounding SPCX on Stocktwits remained in the ‘bullish’ territory over the past 24 hours, amid ‘extremely high’ message volumes.

One user expects the stock to climb to $130.

Another user said SpaceX will be “fully vertically integrated for the future” after the update about the semiconductor fab.

The stock is down more than 31% so far this year.

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