SpaceX is in discussions with Apollo Capital Management and several banks to finance a $40 billion purchase of Nvidia graphics processing units, primarily through the investment-grade debt market, according to a person familiar with the talks. The deal would likely use the GPUs as collateral, with Apollo playing a leading role in facilitating the financing.
The discussions come just months after SpaceX completed a record-breaking IPO in mid-June and then raised $25 billion in bonds at different durations. That bond sale saw incredibly high demand from fixed-income investors, according to CNBC. However, since then, AI-related bonds have sold off and credit spreads have widened, indicating that investors are becoming more selective about their exposure to AI investments.
The proposed $40 billion debt package would rely on the expectation that high-performing GPUs hold their value for approximately seven years, according to a person in the credit industry. Computing power remains scarce and the shortage is not expected to abate soon, supporting the value of the chips.
The talks follow a series of large bond issuances from Meta, Amazon and Google as the cost of funding AI infrastructure grows. Both sources told CNBC that more debt sales are expected and that fixed-income investors are demanding higher yields to service the debt, a sign of increased caution in the market.
The Financial Times first reported on the financing talks. Apollo declined to comment. Nvidia did not immediately respond to a request for comment.
Analysis
Why This Matters
- The size of the potential deal highlights the enormous capital required to build AI infrastructure, with a single company seeking $40 billion just for chips.
- The use of GPUs as collateral signals a shift in how lenders view AI hardware, treating it as a durable asset class with long-term value.
- If completed, the deal would further cement SpaceX's role not just as a space company but as a major player in AI compute, while testing investors' appetite for AI-related debt in a higher-yield environment.
Background
SpaceX, founded by Elon Musk, went public in mid-2026 in what was described as a record-breaking IPO. Shortly after, it raised $25 billion in bonds across various maturities. The company is now seeking additional debt to acquire a massive number of Nvidia GPUs, likely to power AI workloads and potentially its Starlink satellite network or other compute-intensive projects. The broader AI industry has seen a surge in spending on graphics processors, with tech giants like Meta, Amazon and Google also issuing bonds to fund their AI buildouts. However, the debt market for AI-related paper has cooled in recent months as credit spreads have widened and yields demanded by investors have increased.
Key Perspectives
SpaceX and Apollo: The deal would allow SpaceX to secure the chips it needs without depleting cash reserves, while Apollo would earn fees and interest from a large, collateralized loan tied to an asset with assumed long-term value.
Fixed-income investors: They are becoming more cautious, demanding higher yields for AI-related debt after a period of heavy issuance. The willingness to back a $40 billion GPU-collateralized bond will test the market's confidence in both the hardware's residual value and SpaceX's creditworthiness.
AI industry observers: A successful deal would validate the model of using GPUs as collateral for massive debt, potentially opening the door for similar financing structures at other companies. However, if GPU values depreciate faster than expected or if demand for AI compute slackens, bondholders could face losses.
What to Watch
- Whether the deal can secure investment-grade pricing given the recent sell-off in AI bonds and widening credit spreads.
- The terms of the GPU collateral, including how the hardware's value will be appraised and maintained.
- Any public comments from credit rating agencies on SpaceX's leverage and the risk of such a large debt issuance.