SpaceX Negotiates $40 Billion Debt to Acquire Nvidia AI Chips Amid Credit Concerns

SpaceX is reportedly negotiating a substantial debt package of approximately $40 billion aimed at acquiring Nvidia AI chips for its expanding artificial intelligence infrastructure. This proposed financing, which is still in preliminary discussions, would be divided into $10 billion in bank loans and $30 billion in investment-grade bonds, with the goal of enhancing the company's Colossus 2 AI cluster.

The deal, if finalized, would be among the largest financings linked to AI expansion and is expected to close by 2027. Apollo Global Management is anticipated to lead the debt placement, with PIMCO also in discussions as a potential lender. However, the negotiations are still at an early stage, and there is no guarantee that the financing will materialize.

SpaceX's recent financial history shows a rapid accumulation of capital, raising over $150 billion in just four months through its IPO and bond offerings. Despite this, the company's five-year credit default swaps have surged to a record 197 basis points, indicating increased investor concern regarding repayment risk. The bond market is responding cautiously, with a notable widening of spreads on SpaceX's existing bonds.

Investors are divided on the implications of this debt strategy. While some view it as a potential signal for growth, others express concern over the risks associated with borrowing in an overheated AI market. The outcome of these negotiations will be closely monitored, particularly the split between loans and bonds, and whether SpaceX can meet its ambitious chip acquisition targets by December 2026.