SpaceX’s $40 Billion Nvidia Bet Tests Wall Street’s AI Nerve
SpaceX’s $40 Billion Nvidia Bet Tests Wall Street’s AI Nerve
Two weeks after its mid-June IPO, SpaceX raised $25 billion in bonds, drawing strong demand from fixed-income investors as it accelerated its AI ambitions. That appetite now faces a far larger test.
SpaceX is reportedly seeking up to $40 billion in new financing, with Apollo Global Management and several banks discussing a package that could include roughly $30 billion of investment-grade debt and $10 billion in bank loans. The money would principally fund Nvidia graphics processors, potentially using the GPUs themselves as collateral.
The bullish case is straightforward: compute remains scarce, and SpaceX already has commercial deals with Google, Anthropic, Reflection AI and Cursor. Its existing facilities were running 230,000 Nvidia AI chips, while Colossus 2 had 550,000; Musk said in September that the combined count could reach 1.21 million by late December, “if we get lucky.”
That growth story has found an enthusiastic champion in Jim Cramer, who argued that expanding chip purchases validates Nvidia’s economics: “The more Nvidia [that SpaceX] buys, the more money it makes.” He framed the plan as evidence that customers can profit by buying compute and renting it out.
But the financing arrives as AI-related bonds have sold off and credit spreads have widened. SpaceX already reported nearly $40 billion in debt in its second-quarter financials, while its outstanding debt trades near junk-bond levels, according to CNBC. Axios similarly noted that bonds maturing in 2056 traded around 85 cents on the dollar, yielding about 2.27 percentage points above Treasuries.
The result is a defining wager: SpaceX is betting that Nvidia chips will retain value and generate revenue quickly enough to justify borrowing on a scale that is making investors more selective about AI exposure.
Write a comment