SpaceX Plans to Raise $40 Billion for Nvidia Chip Purchases

SpaceX is seeking $40 billion in debt financing to acquire AI chips from Nvidia. This was reported by the Financial Times. The company's shares have already risen by approximately 15% over the past five days, raising SpaceX's market capitalization to $2.17 trillion. The requested amount is about 1.8% of SpaceX's market capitalization, according to Google Finance data. About $10 billion will be covered by bank loans, while the remaining $30 billion – will come from investment-grade debt financing, which involves bonds from relatively high-rated borrowers.

Apollo Global Management is expected to lead the deal and place the debt among investors. Among the creditors negotiating is also Pimco, a bond fund. However, the deal is not expected to be completed until 2027. At the close on Tuesday, SpaceX shares were valued at $171.92, up $23.29 over five days. Nevertheless, they remain about 24% below their 52-week high of $225.64. According to Elon Musk, by December, the xAI Colossus 2 data center will be able to run more than twice as many Nvidia chips, with SpaceX planning to build its data centers exclusively on Nvidia equipment.

Apollo is already collaborating with Nvidia on AI financing. In August, Nvidia entered into a partnership with Apollo and five other companies, including BlackRock and KKR, aimed at raising over $500 billion for AI projects. Morgan Stanley predicts that AI infrastructure will require $1.5 trillion in external financing by 2028; however, creditors and investors are becoming more cautious about investments in this area. SpaceX's capital raise serves as a test of whether credit markets remain open to this demand. The stock price may indicate whether equity is willing to take on additional leveraged financing.