SpaceX seeks $40bn financing to buy Nvidia AI chips

In short: SpaceX is reportedly trying to raise about $40bn to pay for a major purchase of Nvidia chips used to run AI systems.

What happened

SpaceX is seeking a large financing package led by Apollo Global Management, according to people familiar with the talks. The goal is to fund an order of Nvidia chips, which are widely used to train and run AI models (software that learns patterns from lots of data).

The plan would include about $10bn in bank loans and $30bn in investment-grade debt. Investment-grade debt is company borrowing seen as safer than “junk” debt, which can make it easier for big institutions like pension funds and insurance companies to invest.

The Financial Times reported the transaction is expected to close in 2027. Bond manager Pimco was among a small group of lenders in talks, according to the report. Apollo and Pimco declined to comment, and SpaceX and Nvidia did not immediately respond.

The report also notes that SpaceX’s BBB credit rating is investment-grade, but near the lower end. SpaceX has taken on significant spending commitments, and some of its longer-term bonds have traded at prices and yields that suggest investors want extra compensation for the risk.

Why it matters

This is another sign of how expensive AI has become behind the scenes. AI needs huge numbers of specialized chips and the data centers that house them, like buying the engines and building the garages at the same time. When companies raise tens of billions of dollars just for chips, it can shape prices, competition, and how quickly new AI products reach consumers.

Source: Financial Times