Bond Investors Concerned Over SpaceX's $40 Billion Debt to Purchase Nvidia Chips
SpaceX is planning to take on an additional $40 billion in debt—$30 billion through bond issuance and another $10 billion from banks—to fund the purchase of chips from Nvidia. This new borrowing would nearly double its existing debt load, which stood at $39.4 billion as of June 2026. The move has raised concerns among investors, reflected in a sharp increase in credit default swap (CDS) prices for SpaceX bonds—up by 76% since early June. Despite holding $100 billion in cash equivalents and marketable securities at the end of June, much of it from its recent IPO and bond issuance, SpaceX is burning through capital rapidly due to heavy spending on AI infrastructure. The company's borrowing plans align with broader trends among hyperscalers investing heavily in data centers, expected to reach $800 billion this year and grow further by 2027. However, skepticism remains about whether SpaceX will become a major player in the AI space or compete effectively against other hyperscalers. This uncertainty has led investors to demand higher insurance premiums for holding its debt.
Topics: credit default swaps (CDS) debt issuance financial risk SpaceX