Apollo, banks in talks to finance SpaceX's $40 billion Nvidia GPU purchase — SkimNews
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- SpaceX is in discussions with Apollo Capital Management and several banks to finance a $40 billion purchase of Nvidia GPUs
- The deal will primarily rely on the investment-grade debt market, which SpaceX tapped just four months ago when it raised $25 billion in bonds two weeks after its mid-June IPO
- Apollo Capital is playing a leading role in facilitating the financing, and the $40 billion deal will likely use the GPUs themselves as collateral
- AI-related bonds have sold off and credit spreads have widened since SpaceX's earlier bond sale, with fixed-income investors now demanding higher yields to service AI-related debt
- The credit market still operates under the expectation that GPUs hold their value for about seven years, a view supported by ongoing scarcity of computing power
- Meta, Amazon, and Google have also issued bonds to fund AI infrastructure buildouts, part of a broader wave of debt sales as AI costs climb
Why it matters: A $40 billion deal would nearly double SpaceX's $25 billion bond issuance from earlier this year and would lean on a novel collateral structure — Nvidia chips pledged against the loan. That structure only works if GPUs retain significant resale value for roughly seven years, an assumption that is now being tested as AI-related credit spreads widen and investors demand higher yields to absorb further AI debt.
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