SpaceX seeks $40 billion to buy Nvidia AI chips, FT says

Summary

• SpaceX is raising $40 billion led by Apollo to fund an Nvidia chip order, the FT reported.
• The package splits into roughly $10 billion in bank loans and $30 billion in investment-grade debt.
• It is one of the largest single corporate financings tied to buying AI processors.

The latest

A $40 billion financing package is being assembled for SpaceX to fund a purchase of Nvidia artificial-intelligence chips, the Financial Times reported Tuesday, citing people familiar with the matter. Apollo Global Management is expected to lead the deal and place the debt with a wide investor base, according to the newspaper. Reuters, which carried the report, said the transaction is expected to close in 2027.

Details

• The structure: The company is seeking about $10 billion in bank loans and roughly $30 billion in investment-grade debt to cover the chip order, according to the FT. Splitting the raise between bank lending and bond-market debt spreads the exposure across two different pools of capital rather than concentrating it with a single set of lenders.
• Who is involved: Apollo is expected to lead the transaction and help distribute the debt to a broad range of investors, the newspaper said. Bond fund Pimco is among a small group of lenders in talks to provide financing. The FT did not identify the banks expected to supply the $10 billion loan component.
• The companies' response: SpaceX, Apollo and Nvidia did not immediately respond to requests for comment from Reuters. Pimco declined to comment. None of the parties has publicly confirmed the size of the chip order, the pricing of the debt, or the timetable for signing.
• Market reaction: Shares of the rocket and spacecraft manufacturer fell 1% in extended trading after the report, while Nvidia's stock rose 0.5%, according to Reuters. The split reaction points to a deal read as costly for the buyer and additive for the supplier of the processors.
• The scale of the boom: Morgan Stanley estimates AI infrastructure will require $1.5 trillion in external financing by 2028, Reuters reported. That estimate lands as lenders and investors grow more cautious about funding the industry's expansion, making the structure and pricing of deals like this one a live question for the credit market.
• Musk's chip plans: Musk said last month that xAI's Colossus 2 data center could more than double the number of Nvidia chips it uses by December, and that the company plans to use Nvidia hardware exclusively to build its data centers. He did not give a figure for the total number of processors involved.
• The IPO backdrop: Musk took SpaceX public in June in a record $86 billion initial public offering, Reuters noted. The listing gives the company a public equity base and a market price, both of which shape how debt investors assess a borrower of this size.
• Nvidia's financing push: Nvidia, the dominant supplier of AI processors, partnered in August with Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs and KKR on financing platforms intended to mobilize more than $500 billion for AI infrastructure projects. Apollo's role in the SpaceX raise places it on both sides of that effort.

Between the lines

The deal illustrates how chip purchases are migrating from corporate cash into structured debt markets. With Morgan Stanley projecting $1.5 trillion in external AI financing needs by 2028, and Nvidia itself helping assemble lending platforms with Apollo and five other firms, the supplier of the processors is increasingly adjacent to the capital that buys them.

What's next

Watch for confirmation from SpaceX, Apollo or Nvidia, the identity of the banks on the $10 billion loan, pricing terms on the investment-grade tranche, and whether the transaction closes in 2027 as reported.

Source: Reuters, Financial Times