SpaceX is in talks to borrow about $40 billion to buy Nvidia chips

SpaceX is in talks to borrow about $40 billion to pay for an order of Nvidia chips, according to people familiar with the discussions, a deal that would show how heavily the race to build artificial intelligence now leans on borrowed money.

The Financial Times reported on Tuesday evening that the package would combine about $10 billion of bank loans with about $30 billion of investment-grade bonds. Apollo Global Management is expected to lead the financing and help sell the debt to a broad range of investors, and the bond manager Pimco is among a small group of lenders in talks to provide money, according to that report. The transaction is expected to close in 2027.

A second news organization separately reported the talks, also citing people familiar with the matter, and said the discussions are at an early stage and could end without a deal. SpaceX, Apollo and Nvidia did not immediately respond to requests for comment, and Pimco declined to comment.

None of the companies has confirmed the amount, the terms or the timing. The reports did not say how many chips the money would buy, what the debt would cost SpaceX or how the bonds would be structured.

Why SpaceX wants the chips

SpaceX now combines Elon Musk's rocket, satellite and artificial intelligence businesses, and the chips would feed the AI side. In September, Musk said Colossus 2, the computing cluster his xAI business is building in the Memphis area, could more than double its Nvidia chip count by the end of this year. He said the site already had 110,000 of Nvidia's GB200 chips and 440,000 of its newer GB300s. Musk has also said the company plans to build its data centers using only Nvidia hardware.

SpaceX went public in June in an $86 billion initial public offering, the largest on record. The borrowing under discussion would equal almost half of that sum, by TickerGrove's calculation.

Apollo and Nvidia's financing push

Apollo is one of the firms Nvidia lined up in August for financing platforms meant to mobilize more than $500 billion for AI infrastructure. The others are BlackRock, Blackstone, Brookfield, Goldman Sachs and KKR. The group said at the time that it would "create dedicated pools of capital at significant scale at attractive rates for Nvidia customers," and executives said the effort would focus on debt that helps Nvidia's largest buyers pay for computing power.

The SpaceX talks fit that model: a chip buyer borrows from investors so it can pay the chipmaker. Morgan Stanley estimates that AI infrastructure will need $1.5 trillion of outside financing by 2028, even as some lenders and investors have grown more careful about funding the industry's expansion.

How the stocks reacted

SpaceX shares gave up their gains after the report, falling as much as 1.8% in after-hours trading, while Nvidia rose as much as 0.6%. SpaceX had closed Tuesday at $171.92, up 0.5%. In early premarket trading on Wednesday the stock was at $168.84, down 1.8%, and Nvidia was up 0.2% at $239.75, according to cnbc.com market data at about 4:25 a.m. Eastern time. Apollo closed Tuesday at $115.95.

The split reaction shows how the trade sorts out: Nvidia would collect the spending, while SpaceX shareholders would carry the debt.