SpaceX has a binding commitment with an entity managed by Apollo Global Management to finance roughly $40 billion of graphics processing units and related data-center equipment, the company said in a regulatory filing Monday, MarketWatch reported. Elon Musk had announced on X on Sunday that the financing was closed, CNBC reported.
How the deal works
- A lease, not a loan: The Apollo-managed entity buys the equipment and leases it to SpaceX, which pays quarterly for about five years, MarketWatch reported.
- Payments: Each quarter SpaceX pays generally one-twentieth of the financed cost, plus fixed-rate interest on the balance and some expenses.
- Timing: The equipment arrives in installments, with individual leases expected to start in the first half of 2027. SpaceX expects to finalize the master lease before year-end, subject to closing conditions.
- Size: About $40 billion in total principal payments, not counting interest and other costs.
Musk's warning
Musk said SpaceX could borrow because it is investment grade and earns revenue from Starlink and rocket launches, CNBC reported. He said debt markets have largely cut off companies without substantial revenue outside AI data centers, and predicted that more than 200 so-called neocloud companies face widespread failures and consolidation, with only a few surviving.
SpaceX's AI unit, which it calls "Super Intelligence," has become its largest business, with third-quarter revenue up ninefold to $7.56 billion from $813 million a year earlier, according to CNBC.