Lockups, Biotech, and Defense: The 2026 IPO Market's Mid-August Stress Test

The IPO market just passed its most visible stress test of the summer. SpaceX’s first lockup expiry freed 911.5 million shares for trading on August 6 — more than the 640 million shares the company floated at its June IPO — and the stock rose 6% instead of cratering.^[1] Meanwhile, the Renaissance IPO Index rebounded 8.6% for the week ending August 9, outpacing the S&P 500’s 3.6% gain, as biotech listings and recovering AI sentiment pulled new issues back above +20% for the year.^[2]

The natural question is whether this resilience tells us the market can absorb a multi-year wave of share supply — or whether we are simply early in the unlocking cycle, with the harder tests still ahead. Goldman Sachs Research frames the tension precisely: corporate demand for U.S. equities is likely to outstrip supply in 2026, but the math gets more challenging in 2027 as lockups expire and floats expand.^[3]

The supply picture: large deals, fewer of them

The headline numbers carry a paradox. Through mid-August, 102 IPOs have priced in the U.S. this year, down 25% from the same period in 2025.^[4] But total proceeds raised reached $145.5 billion, a 543% increase year-over-year.^[4] The gap is explained by deal size: a wave of mega-listings, many tied to AI infrastructure and defense technology, has concentrated dollar volume even as deal count runs below the 25-year average of roughly 100 per year.

Goldman’s chief U.S. equity strategist Ben Snider put the midyear tally at “just shy of 50” U.S. IPOs — about double last year’s pace — with dollar issuance already tied with 2021’s record of approximately $120 billion.^[3] The firm’s IPO Barometer, which combines interest rates, CEO confidence, and equity valuations, reads 140 against a long-term average of 100 — healthy, but not at the euphoric extremes of 2021 or the late 1990s.^[3]

That distinction matters. In 2021, there were over 250 IPOs. In 1999, nearly 400. This year’s deal count, while accelerating, sits near the long-term average rather than in bubble territory. The dollar volume is exceptional, but the number of companies coming public is not.^[3]

The demand side: buybacks as the counterweight

The fear investors raise most often, Snider notes, is that new share supply will overwhelm the market. He offers three reasons it probably will not — at least not this year.

First, the combined forecast for IPOs and follow-on offerings is approximately $700 billion, which scales to about 1% of the total equity market — actually below the long-term average and roughly in line with 2015–2019.^[3] Second, markets grow over time, so the same nominal supply represents a smaller fraction of total market capitalization. Third, corporate buybacks are on pace to exceed $1 trillion this year, meaning corporate demand for shares will outweigh corporate supply of shares before even counting retail, hedge fund, or mutual fund buying.^[3]

AI-related capital spending is the engine behind much of the issuance. Goldman attributes the rise in follow-on equity largely to financing needs tied to AI investment, but expects buybacks and debt financing to offset much of the incremental supply.^[5] The risk is that if AI capex continues to crowd out buybacks — a trend Goldman flagged earlier this year — the demand-side cushion thins.

SpaceX: the lockup that didn’t break

SpaceX’s August 6 lockup expiry was, by broker Robert Hackel’s description, “the most talked-about lockup in the history of IPO lockups.”^[6] Up to 912 million of SpaceX’s roughly 13.6 billion outstanding shares became eligible for sale, more than doubling the public float from the 640 million shares sold at IPO.^[6]

The setup was bearish: SpaceX shares had already fallen 14% the day before, closing at $108.27 — an all-time low — after an earnings report revealed larger-than-expected AI capital expenditures.^[1] The stock sat 49% below its June high and 15% below its $135 IPO price.^[1] Brokers were fielding calls from pre-IPO investors eager to sell SpaceX and redeploy into private positions in Anthropic, OpenAI, and Anduril.^[6]

What actually happened defied the base-rate expectation. The stock rose 6% on the day of the unlock^[1] and finished the week up 23%, nearly back to the offer price.^[2] Renaissance’s Matt Kennedy noted the dynamic: employees and early investors sitting on massive gains had strong incentives to sell, but lower-than-expected insider selling after a lockup release can function as a buy signal.^[2][6]

The staggered lockup schedule, however, means this was only the first test. An additional 12.9 billion shares will be freed by mid-2027, with executive lockups beginning to expire after fourth-quarter results.^[6] Elon Musk’s roughly 42% stake remains locked until one year post-IPO.^[6] Each subsequent expiry will expand the public float, and the Nasdaq 100 — which SpaceX joined this summer — will rebalance in September to reflect the newly available shares. At current prices, SpaceX’s index weight could rise above 3.5%, up from about 1%.^[1]

Biotech: the quiet winning streak

While SpaceX dominated headlines, four clinical-stage biotech companies priced IPOs in the first week of August, and none finished negative.^[2] Braveheart Bio (BRVE), targeting cardiovascular disease, completed the week’s largest offering and gained 65.6% on its first day, supported by Phase 2 data and a cornerstone investment from Fidelity.^[2]

The biotech IPO streak is worth watching because it has persisted through the July AI sell-off that dragged the broader IPO index lower. Renaissance characterizes biotech and AI infrastructure as the two themes most likely to continue driving the fall pipeline.^[2]

Defense tech and the fall pipeline

Next week brings Lyntris Inc. (NYSE: LYNX) to market. The Falls Church, Virginia-based defense technology company is offering 24 million shares at $19–$22, seeking up to $528 million and targeting a valuation of approximately $2.5 billion.^[7] The deal is notable for its structure: only 4.9 million shares come from the company, while 19.1 million are secondary shares from existing holders — meaning most of the proceeds go to selling stockholders rather than the balance sheet.^[7]

Lyntris fits the defense-tech wave that has been building alongside the AI infrastructure theme. The company delivers “sense-to-act” connectivity solutions for the connected battlespace, and its filing follows a period of elevated demand for defense-related listings.^[7]

Secondaries and the supply-demand balance

The secondary market is also sending signals. On August 11, OPENLANE (NYSE: OPLN) announced an underwritten secondary offering of 8 million shares by Ignition Acquisition Holdings, a fund advised by Apax Partners.^[8] The company authorized a concurrent share repurchase, but it covers only a fraction of the supply. OPENLANE shares dropped 5.3% in premarket trading on the announcement.^[8]

This is the micro-level version of the macro tension Goldman describes. A large shareholder exits; the company partially offsets with a buyback; the net effect is still dilutive to the float. When this pattern multiplies across hundreds of deals — as Goldman projects for 2027 — the demand-side cushion narrows.^[3]

What would have to be true for each side

The optimistic case rests on three pillars: deal count is near the historical average rather than in bubble territory, buybacks exceed $1 trillion and absorb the incremental supply, and the IPO Barometer — while elevated — is well below 2021 or 1999 extremes. If earnings continue to grow at the pace Goldman projects — forward earnings up 17% year-to-date driving the S&P 500’s 10% gain — the market can digest the issuance without multiple compression.^[3]

The cautious case is really a 2027 problem. IPOs are coming public with small floats; lockups are staggered over 12–18 months; and each expiry adds supply that the initial offering did not. Goldman’s Snider is explicit: “the math does get harder in 2027.”^[3] If AI capex continues to crowd out buybacks — as Business Insider reported Goldman warning in May^[5] — the corporate demand that currently absorbs supply will weaken at exactly the moment supply accelerates. The SpaceX staggered calendar is the leading indicator: 12.9 billion more shares unlocking by mid-2027 is a supply event without recent precedent at this scale.^[6]

What to watch next

• SpaceX lockup #2: The next tranche of SpaceX share unlocks will test whether the first expiry’s resilience was structural or coincidental. Watch for the timing announcement and whether executive lockups begin expiring after Q4 results.^[6]
• Lyntris (LYNX) pricing: The defense-tech deal prices the week of August 19. The 80% secondary composition makes it a signal for whether the market absorbs seller-driven supply at a $2.5 billion valuation.^[7]
• Nasdaq 100 September rebalance: SpaceX’s index weight could jump above 3.5%, forcing passive funds to buy. The rebalance is a mechanical demand event — but it cuts both ways if the stock declines before the effective date.^[1]
• Anthropic and OpenAI IPO timing: Renaissance suggests that if SpaceX sustains its rally, the odds of a mega-IPO from Anthropic or OpenAI increase.^[2] Any filing would be the largest supply event of the year.
• Buyback cadence in Q3 earnings: If the May trend of AI capex crowding out buybacks accelerates, Goldman’s demand-side cushion narrows faster than the 2027 timeline suggests.^[5]
• August lull or August rush?: Renaissance describes this as “last call” for the summer IPO window before the traditional August slowdown.^[2] Whether the calendar fills or thins will signal whether issuers are racing to beat a tougher 2027 supply environment.