VELO Stock Extends Selloff For Fourth Straight Session As Short Seller Claims SpaceX Relationship Is ‘Virtually Dead’
Velo3D (VELO) shares fell 5% after Morpheus Research alleged its relationship with SpaceX (SPCX) ended years ago, citing former employees. The short-seller also questioned VELO's defense pipeline and CEO's background. VELO is down 24% YTD, up 126% in 12 months.
How this was made

The 30-second read
Why it matters
The allegations create immediate negative sentiment, driving a 5‑10% drop and likely further downside as investors await clarification.
Market read
The report triggers a notable intraday sell‑off in VELO, highlighting risks for investors in niche manufacturing firms reliant on high‑profile OEM partnerships.
What to watch
Potential undisclosed revenue from other aerospace customers or defense contracts not mentioned in the report.
Background
A short‑seller report from Morpheus Research alleges that Velo3D's claimed partnership with SpaceX ended years ago and that its defense pipeline is speculative, prompting a sharp price decline.
Ticker impact
Morpheus Research's short‑seller report alleging Velo3D overstated its SpaceX relationship and defense pipeline caused VELO shares to fall nearly 10% on Thursday.
Further downside pressure as investors reassess growth outlook.
The report introduces new, material doubts about key revenue sources; the stock already dropped 5‑10% on the news.
Market effects
Additive‑manufacturing and defense suppliers may see heightened scrutiny of partnership claims.
U.S. tech and aerospace stocks could experience modest volatility as investors digest the allegations.
Limited to companies with similar OEM relationships; no broad macro impact.
Counterpoint
If Velo3D can demonstrate alternative contracts or internal production capabilities, the short‑seller claims may be overblown.
Key entities
- companyVelo3D Inc.
3D metal printing firm listed on Nasdaq (VELO).
- research_firmMorpheus Research
Short‑seller that released the critical report.
- companySpaceX
Aerospace client allegedly no longer purchasing Velo3D printers.


