Elon Musk’s SpaceX is planning to raise approximately $40 billion to acquire Nvidia chips as part of an expanded investment in advanced technology for artificial intelligence and aerospace applications. According to sources familiar with the matter, the company seeks to secure around $10 billion through bank loans and $30 billion in investment-grade debt to fund the chip purchase. The financing effort is expected to close next year.
Private capital firm Apollo is anticipated to lead the financing and assist in distributing the debt to various investors. Bond asset manager Pimco is reportedly among a limited group of lenders involved in discussions to support the transaction. Both Apollo and Pimco declined to comment, while neither SpaceX nor Nvidia responded to requests for comment.
This large-scale financing move highlights the significant capital being directed towards building infrastructure for AI, including data centers and semiconductor acquisitions. SpaceX’s access to investment-grade debt is facilitated by its BBB credit rating, which is the second-lowest tier in investment-grade classifications. This rating enables insurance companies and pension funds to purchase SpaceX’s bonds, entities generally restricted from investing heavily in lower-rated, or “junk,” securities.
The planned purchase would deepen the strategic relationship between SpaceX and Nvidia. Musk has publicly committed to relying exclusively on Nvidia’s technology, citing the company’s Vera Rubin AI architecture as the best available platform. During SpaceX’s earnings call in August, Musk described Nvidia’s systems as the “best AI computer” and emphasized the company’s valued cooperation with Nvidia at multiple levels.
SpaceX recently secured its investment-grade rating following its $86 billion initial public offering in June and subsequently issued $25 billion in high-grade bonds within weeks. However, these bonds faced sell-offs after concerns arose regarding the company’s rising debt levels and substantial capital expenditure commitments. Bonds maturing in 2056 are currently trading around 85 cents on the dollar, with yields approximately 2.27 percentage points above comparable U.S. Treasury notes, reflecting a risk profile similar to lower-rated bonds.
Apollo also played a leading role earlier this year in a $35 billion chip-financing deal involving Broadcom, Nvidia’s competitor, which was the largest private credit transaction at that time. Additionally, Nvidia announced in August that it was collaborating with several major Wall Street firms to establish a $500 billion funding platform aimed at pooling third-party capital specifically to finance the purchase of Nvidia’s chips. This consortium reflects growing demand and substantial financing needs in the semiconductor industry amid the AI technology boom.