Key takeaways
- SpaceX is in talks to raise about $40 billion, roughly $10 billion in bank loans and $30 billion in investment grade debt, to buy Nvidia chips.
- Apollo Global Management is expected to lead the financing, with Pimco among the lenders in talks, and the deal could close in 2027.
- The chips would power xAI, which Musk folded into SpaceX this year and which plans to use Nvidia hardware exclusively.
SpaceX is lining up a huge debt package with one main purpose: buying Nvidia hardware. The SpaceX Nvidia chips plan calls for raising about $40 billion to equip the company's artificial intelligence data centers, according to the Financial Times, which cited people familiar with the matter. Reuters followed with its own report on Oct. 6, and the news moved both stocks in after hours trading.
The deal is early and could still change or collapse. But the size alone says a lot about where the AI buildout is heading, and about how Elon Musk plans to pay for it now that xAI sits inside SpaceX.
What happened
According to the FT report as relayed by Reuters, the financing would come in two pieces. Roughly $10 billion would be bank loans. The other $30 billion or so would be investment grade debt sold to large investors.
Apollo Global Management is expected to lead the package and help place the debt with a broad group of buyers. Bond giant Pimco is among a small group of lenders in talks to provide money. If the talks succeed, the transaction is expected to close in 2027.
SpaceX, Apollo and Nvidia did not immediately respond to requests for comment from Reuters. Pimco declined to comment.
Investors reacted quickly. SpaceX shares slipped about 1% in extended trading after the report, while Nvidia's stock rose about 0.5%, Reuters said.
Why SpaceX needs this many Nvidia chips
The short answer is xAI. Musk folded his AI company into SpaceX earlier this year, which put the Grok chatbot and the Colossus supercomputer clusters under the same corporate roof as rockets and Starlink. If you have followed our guide to how satellite internet works, you know Starlink already needs huge amounts of capital. AI training is even hungrier.
Last month Musk said xAI's Colossus 2 data center could more than double its count of Nvidia chips by December. He also said the company plans to use Nvidia hardware exclusively in its data centers, according to Reuters. That kind of commitment does not come cheap, and a $40 billion financing plan shows just how expensive the chips, networking and power behind a frontier cluster have become.
A public company with public scrutiny
SpaceX is no longer a private startup raising quiet rounds. Musk took the company public in June in a record $86 billion IPO, and it later sold $25 billion of bonds, according to TechStartups. The FT has reported that those bonds have come under pressure from investors worried about heavy capital spending and limited financial disclosure.
That backdrop matters. Adding another $40 billion of debt on top of an existing bond load will invite hard questions from credit analysts about cash flow, how much of it comes from Starlink, and how long the AI side can run before it earns its keep.
The SpaceX Nvidia chips deal and the AI financing boom
This is not a one off. Buying graphics processors at this scale has turned into a financing problem as much as a technology problem. Companies that want to stay in the frontier AI race now borrow the way utilities and pipeline operators do.
Morgan Stanley estimates that AI infrastructure will need about $1.5 trillion in outside financing by 2028, Reuters noted, even as lenders and investors become more cautious. In August, Nvidia teamed up with Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs and KKR on financing platforms meant to mobilize more than $500 billion for AI infrastructure projects. Apollo's reported role in the SpaceX deal fits neatly into that pattern.
The worry about whether all this spending will pay off is growing. Consulting firm Bain recently argued that AI needs trillions of dollars a year in new revenue to justify the money going in. A $40 billion loan for chips is a bet that those returns will show up.
Why Nvidia comes out ahead either way
For Nvidia, a deal like this is close to the best case. A customer that commits to its hardware exclusively and arranges outside money to pay for it removes a lot of uncertainty from future orders. It lands as Nvidia also pushes into consumer hardware, including laptops like the Surface Laptop Ultra with Nvidia RTX Spark.
The small move in Nvidia's share price suggests investors already expected heavy demand from xAI. The bigger story is the confirmation that this demand will be funded.
Who is affected
Investors in SpaceX. Shareholders and bondholders will want to see how the new debt fits alongside existing obligations. More borrowing raises the stakes on whether xAI can produce revenue, not just headlines.
Lenders and bond funds. Apollo, Pimco and the wider pool of buyers would be taking a large position in a single borrower whose spending plans are aggressive. That is the kind of concentration risk credit desks watch closely.
Rival AI labs. Other big AI developers want the same high end Nvidia parts. A large, funded order from xAI raises the bar for anyone trying to keep pace. Policy makers are paying attention too, as shown by the recent White House accord on super intelligence safety signed by several AI leaders.
Everyday users. Most people will feel this indirectly. More compute usually means faster and more capable Grok features, and it also feeds the debate over power use and the cost of AI services.
What to watch next
A few signals will show whether this deal is real or just a trial balloon:
- Formal confirmation. So far the details come from people familiar with the talks. A filing or official statement from SpaceX would make it concrete.
- The final structure. Watch whether the 25/75 split between bank loans and bonds holds, and what interest rate investors demand.
- Credit ratings. The investment grade label depends on rating agencies. Any downgrade warning would raise borrowing costs.
- Colossus 2 progress. Musk's December target for doubling the chip count is a near term checkpoint.
- Investor mood on AI. If skepticism about AI returns keeps rising, a deal expected to close in 2027 could be resized or delayed.
For more coverage of the biggest companies shaping the industry, see our tech news section.
Frequently asked questions
How much is SpaceX trying to raise for Nvidia chips?
About $40 billion, according to the Financial Times. Roughly $10 billion would be bank loans and about $30 billion would be investment grade debt.
Who is leading the SpaceX financing?
Apollo Global Management is expected to lead the deal and place the debt with investors. Pimco is among the lenders in talks, according to Reuters.
Why does SpaceX need AI chips?
SpaceX now owns xAI, the maker of Grok, which runs the Colossus supercomputer clusters. Musk has said xAI will use Nvidia hardware exclusively and could more than double Colossus 2's chip count by December.
When would the deal close?
If talks succeed, the transaction is expected to close in 2027. The talks are at an early stage, so terms could change.
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