SpaceX looks to $40 billion debt raise to buy chips
The company’s reported raise shows it is stuck between mature tech giants like Google and Meta and startups like OpenAI and Anthropic.
SpaceX, led by Elon Musk, is navigating the artificial intelligence capital expenditure wars by raising $40 billion in debt to purchase Nvidia chips. This debt is five times greater than Alphabet's and three times that of Meta, relative to their respective profits. Although revenue from Starlink provides some financial relief, it does not match the cash flow of rivals' advertising businesses.
SpaceX's inability to rely on venture capital following its June public listing has made it challenging to issue new shares to cover its escalating AI expenses. Its relatively low BBB credit rating, just two notches below Meta and Alphabet, makes it a less attractive prospect for blue-chip bond funds. Apollo, a financial entity with vast resources, is stepping in to help SpaceX finance its growing AI tab, which even includes government-like challenges.
Written by urgent.news from Semafor's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
