According to Elon Musk, SpaceX has completed a deal for $40 billion in debt financing to purchase Nvidia graphics chips. The transaction proves the strongest AI buyers can still raise money even though Musk warned that weaker companies are being increasingly denied access to the credit markets.
Callable debt for GPUs drops in early 2027
Musk confirmed the financing in a post on X on Sunday. He announced that SpaceX had wrapped up $40 billion in debt to fund purchases of GPUs.
In a follow-up post, Musk described the money as mostly callable debt. This means SpaceX can redeem the debt early. The chips the debt is set to pay for are due in the first and second quarters of 2027, and are not seen as a major point this quarter, according to Musk.
The loan terms remain unclear. Reuters reported that it was uncertain whether lenders had agreed to the deal. Musk also did not name any banks or disclose interest rates or repayment dates.
The planned raise had already been reported. Yahoo Finance said on October 6 that the $40 billion deal would include about $10 billion in bank loans and $30 billion in investment-grade debt. Apollo Global Management was also expected to lead the financing.
Bloomberg later reported that the borrowing would be done via a separate entity, keeping it off SpaceX’s balance sheet and helping to protect the company’s credit rating.
Pretty much.
As of the past few weeks, debt markets have almost entirely shut off access to money for any company that doesn’t have substantial revenue independent of AI data centers.
SpaceX closed $40B of debt for GPUs, but we’re investment grade and have Starlink & launch revenue.
That means the 200+ neoclouds are going to see guppy-level death and consolidation. Some will make it through, but not many.
— Elon Musk (@elonmusk) October 25, 2026
Investment grade and Starlink revenue did the heavy lifting
Musk said SpaceX’s investment-grade status and revenue from Starlink and rocket launches helped in securing the funding.
SpaceX’s third-quarter revenue rose 161% from a year earlier to $14.58 billion, according to Reuters. Quartz reported that the company’s AI unit generated $7.56 billion in the three months to September 30, up from $813 million a year earlier. Starlink’s connectivity business also recorded $2.37 billion in operating income for the quarter, according to Yahoo Finance.
SpaceX has raised large sums through debt before. In June, the company raised $25 billion in its first bond sale, attracting nearly $90 billion in orders. The proceeds from the bond sale were used to repay a bridge loan.
200-plus neoclouds facing ‘death and consolidation’
The second half of Musk’s message carried a warning for the rest of the industry. He stated that debt markets have “almost entirely shut off access to money” over the last few weeks, especially for any company lacking substantial revenue outside AI data centers.
He singled out neoclouds, firms that rent out computing power built for AI customers. He claimed more than 200 such firms exist, but only a few are likely to survive as the industry consolidates.
“That means the 200+ neoclouds are going to see guppy-level death and consolidation,” Musk wrote. “Some will make it through, but not many.”
Buying the companies was also not an available option, according to Musk, an idea he referred to as “pointless”. CoreWeave and Nebius are examples of neoclouds that rent out Nvidia GPUs and rely on debt to expand.
Investors are also betting heavily against U.S. data center and neocloud stocks amid concerns that companies are borrowing heavily to fund growth they may not be able to sustain.
What the SpaceX balance sheet shows
The numbers explain the appetite for cash. SpaceX ended September with $51.3 billion in cash and $38.6 billion in marketable securities, against a total debt figure of $38.8 billion, Yahoo Finance reported. In the event that the full $40 billion is secured, total debt would roughly double to about $79 billion.
SpaceX is spending far more than it brings in from its operations. In the third quarter, it generated $9.6 billion in cash but spent $19.6 billion on investments. In the first nine months of the year, spending reached $48.1 billion, while cash from operations was just $13.1 billion in total.
Chief Financial Officer Bret Johnsen expects the company to spend another $35 billion to $40 billion in the fourth quarter alone. At that rate, the new loan would cover about a quarter of its spending.
Last week, Musk also said a merger between Tesla and SpaceX would be “a good idea.” He added that both companies had formed independent committees to consider the deal but laid emphasis on the fact no decision had been made at the time.
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