Here's a fun quirk of modern investing: you might own a piece of SpaceX without realizing it. Not directly, of course, since Elon Musk's rocket company remains stubbornly private. But if you hold certain ETFs, you're getting exposure through a side door, and that door just swung wide open.

Alphabet Inc. (GOOGL) (GOOG) has been a SpaceX investor for nearly a decade, and SpaceX is currently completing a tender offer that values the company at approximately $800 billion, according to Bloomberg. Insider shares are being priced at $421 apiece in this transaction, which represents a substantial jump from previous secondary market valuations.

For Alphabet, that means another potential windfall on paper. And for investors holding Alphabet-heavy ETFs, it means a possible earnings surprise that has nothing to do with search ads or cloud computing.

The ETFs That Stand to Benefit

Alphabet doesn't itemize its private investments in public filings, but the effects of SpaceX revaluations have shown up in earnings statements before. Earlier this year, the company reported an $8 billion gain widely believed to stem from SpaceX, following a late 2024 tender offer that valued the rocket maker at $350 billion. That accounting boost helped Alphabet beat earnings expectations in the March quarter, even as its core businesses delivered mixed results.

Now, with SpaceX's valuation more than doubling, investors are anticipating another round of "unrealized gains on non-marketable equity securities" when Alphabet reports next. These gains don't require selling any stock. They simply reflect updated private valuations flowing through the income statement.

Which ETFs feel this most? The ones with concentrated Alphabet positions. The Invesco QQQ Trust (QQQ), which tracks the Nasdaq 100, counts Alphabet as one of its largest holdings. Any earnings bump from SpaceX flows straight into QQQ's performance, even though the fund itself holds zero rocket companies.

Communication services ETFs have even heavier exposure. The Communication Services Select Sector SPDR Fund (XLC) allocates roughly 20% to Alphabet across its Class A and Class C shares. The Vanguard Communication Services ETF (VOX) holds nearly 15% in Alphabet. Both funds could see outsized impacts from non-operating gains that have nothing to do with traditional business performance.

Equal-weight strategies, by contrast, won't feel much of anything. This is all about concentration risk working in reverse: when a mega-cap holding gets an accounting windfall, funds with the biggest stakes benefit most.

Why This Matters for Alphabet's Bottom Line

Alphabet became a SpaceX investor back in 2015, joining a $1 billion funding round alongside Fidelity Investments. Together, the two acquired roughly 10% of the company, according to Bloomberg. Nearly a decade later, that bet is paying off in a big way, at least on the balance sheet.

The accounting treatment is what makes this interesting. Alphabet classifies these as unrealized gains on non-marketable equity securities. Translation: the value goes up based on what other investors pay in private transactions, and that increase hits the income statement. No sale required. No cash changes hands. Just paper profits that make earnings look better.

After Alphabet disclosed the $8 billion gain earlier this year, XLC saw inflows spike by more than $102 million in the final week of April, according to VettaFi data. Investors noticed the earnings beat and piled in.

What Comes Next

With SpaceX's latest tender offer valuing the company at roughly $800 billion, market watchers are expecting another boost when Alphabet reports earnings. The magnitude depends on how much Alphabet still holds and how the accounting shakes out, but given the doubling in valuation from last year's level, the impact could be substantial.

For ETF investors, this is a reminder that mega-cap tech exposure isn't just about artificial intelligence hype or cloud growth metrics. Sometimes the real kicker comes from a private rocket company quietly lifting reported profits through paper gains that show up in your portfolio performance.

If you own QQQ, XLC, or VOX, you're essentially getting a slice of SpaceX's trajectory without ever touching a private market. It's an odd feature of modern portfolio construction, where the lines between public and private markets blur in ways that can surprise even seasoned investors.

In this case, owning Alphabet through an ETF might just be the closest thing retail investors get to riding along on a SpaceX launch.