Apollo’s twin deals offer contrasting signals about Wall Street’s AI money problem: its Mubadala deal is a bet that capital is chasing too few investment opportunities, while its $40 billion SpaceX chip lease suggests AI financing now costs more than it did a few weeks ago.
Apollo’s retirement arm takes in $1 billion a week that it must invest, and its deal-making engine is struggling to keep pace. The deal to buy a stake in Mubadala Capital, Abu Dhabi’s government-backed asset manager, is a bet that the real shortage facing Wall Street is not capital but places to invest it. By investing in Mubadala, Apollo gets first access to a steady stream of deals.
The opposite picture emerges from Apollo’s $40 billion chip lease to SpaceX. When we checked in on SpaceX’s financing six days ago, the riskiest piece appeared likely to find takers at about 3.5 percentage points above a baseline US Treasury rate, steep but reasonable. By the time it closed this week, the spread had widened to 3.95 points, outrageously expensive for SpaceX, which carries an investment-grade rating.
"I won't say they were dumb until four weeks ago, but…" one Wall Street executive said, "they've gotten a lot smarter, fast."
Goldman Sachs CEO David Solomon noted the uncertainty surrounding the AI boom. "While we are proud of the privileged position we play in the AI investment cycle, no one knows how the demands for capital and compute will evolve as the broader AI ecosystem matures," he said on a recent analyst call. "That will only become clearer as technology and markets continue to develop."
Analysis
Why This Matters
- The divergent signals from Apollo's deals suggest that the cost of funding for AI projects is rising rapidly, even as investors seek more opportunities.
- A squeeze on AI financing could slow data-centre construction, chip procurement and infrastructure development that underpins the technology's growth.
- The widening spread on SpaceX's lease indicates that lenders are becoming more cautious about the risks of the AI trade, potentially affecting other high-profile deals.
Background
Apollo Global Management is a major asset manager active in private equity and credit. Its retirement arm collects about $1 billion in premiums each week, which must be deployed into investments. The AI boom has prompted a surge in demand for capital to fund computing infrastructure, including chip leasing and data centres. Mubadala Capital is the investment arm of Abu Dhabi's government, managing a portfolio of global assets.
Key Perspectives
Wall Street executive: said of capital providers: "I won't say they were dumb until four weeks ago, but… they've gotten a lot smarter, fast."
Goldman Sachs CEO David Solomon: said no one knows how AI demands will evolve, adding that clarity will come only as "technology and markets continue to develop."
What to Watch
- The direction of spreads on AI-related debt in the coming weeks as more deals come to market.
- Whether Apollo and other large asset managers continue to seek partnerships with sovereign wealth funds to access deal flow.
- Any public commentary from rating agencies or regulators on the risk profile of AI infrastructure financing.
Checked
12 claims in this story checked against 1 source: 12 supported.
Show each claim
- SupportedApollo’s contrasting AI deals reveal a Wall Street capital dilemma.Semafor: “One player in the great spend-a-thon of 2026 provides us with two different answers.”
- SupportedThe Mubadala deal and $40 billion SpaceX chip lease point to too few investment opportunities and higher AI financing costs.Semafor: “The takeaway is that an oversupply of capital is chasing too few opportunities. Apollo’s $40 billion chip lease to SpaceX suggests the opposite.”
- SupportedApollo’s retirement arm takes in $1 billion a week that it must invest.Semafor: “Apollo’s retirement arm takes in $1 billion a week that it has to find something to do with”
- SupportedApollo’s origination engine cannot keep up with the money it needs to invest.Semafor: “its origination engine can’t keep up.”
- SupportedApollo’s deal is to buy a stake in Mubadala Capital, Abu Dhabi’s government-backed asset manager.Semafor: “Apollo’s deal to buy a stake in Abu Dhabi’s government-backed asset manager, Mubadala Capital”
- SupportedBy investing in Mubadala, Apollo gets first access to a steady stream of deals.Semafor: “By investing in Mubadala, it gets first dibs on a steady stream of deals.”
- SupportedSix days before the SpaceX financing closed, its riskiest piece appeared likely to attract takers at about 3.5 percentage points above a baseline US Treasury rate.Semafor: “When we checked in on SpaceX’s financing six days ago, the riskiest piece appeared likely to find takers at about 3.5 percentage points over a baseline US Treasury rate”
- SupportedBy the time the SpaceX financing closed that week, the spread had widened to 3.95 points.Semafor: “By the time it closed this week, the spread had blown out to 3.95 points”
- SupportedThe financing was described as outrageously expensive for SpaceX, which carries an investment-grade rating.Semafor: “outrageously expensive for SpaceX, which carries an investment-grade rating.”
- SupportedA Wall Street executive said, “I won't say they were dumb until four weeks ago, but… they've gotten a lot smarter, fast.”Semafor: ““I won’t say they were dumb until four weeks ago, but…” said one Wall Street executive, “they’ve gotten a lot smarter, fast.””
- SupportedGoldman Sachs CEO David Solomon said no one knows how demands for capital and compute will evolve as the AI ecosystem matures.Semafor: ““While we are proud of the privileged position we play in the AI investment cycle, no one knows how the demands for capital and compute will evolve as the broader AI ecosystem matures,” Goldman Sachs’ CEO David Solomon said on a recent call with analysts.”
- SupportedSolomon said the uncertainty would become clearer as technology and markets develop.Semafor: ““That will only become clearer as technology and markets continue to develop.””
