A measure of SpaceX’s credit risk surged to a fresh high and the company’s bonds weakened in the secondary market on Wednesday, following reports the company is in talks with banks and investors to raise $40 billion to buy chips · from Nvidia Corp.
The price of five-year credit default swaps on the company’s debt, which increases as investor concern grows, rose as much as 0.167 percentage point, or 16.7 basis points, to around 197.6 basis points a year, according to ICE Data Services. It’s the highest intraday level since the swaps tied to the Elon Musk’s rocket, satellite and AI conglomerate started actively trading in June.
The worries spilled over into bond markets for tech and media giants, with bonds from companies including SpaceX, Meta Platforms Inc. and Skydance Corp. all weakening. Tech companies and AI model developers are investing and borrowing hundreds of billions of dollars to build and lease giant data centers full of chips to power AI systems, and it’s unclear when the wave of debt that’s resulting will crest.
“This is unprecedented debt supply with no real ending in sight,” Sal Naro, chief investment officer at Coherence Credit Strategies, told Bloomberg News, speaking about AI debt in general. “The world has never seen an infrastructure build like this. This is larger than the railroads because this is global, all at once.”
SpaceX is looking to raise · $40 billion in what would be among the biggest-ever debt financings for the AI buildout. The company’s fundraising discussions are in an early stage and could end without a deal being completed, Bloomberg reported, citing people familiar with the matter.
It might include a $10 billion of bank loans and $30 billion of investment-grade debt according to the Financial Times, citing unidentified sources familiar with the matter.
A representative for SpaceX wasn’t available for comment.
Apollo Global Management Inc., which is in a partnership that Nvidia tapped to source $500 billion in financing for AI infrastructure, previously struck deals with Musk companies that include a $7 billion financing for xAI for access to Nvidia. That debt was earmarked for a special purpose vehicle to help Musk’s startup rent chips for its Colossus 2 data-center site in Memphis.
If that transaction is a model, then this funding may also use a special purpose vehicle. In the long term, that kind of financing might be good for SpaceX by reducing the amount of debt at the parent company, according to a Wednesday note from Barclays Plc credit analysts including Andrew Keches. But in the near term, the coming supply could put pressure on the company’s obligations, they wrote.
Spreads on SpaceX’s 5.875% bonds due in 2036 widened 5 basis points to 193 basis points as of 1:53 p.m. in New York, according to Trace. That’s significantly wider than the 140-basis-point spread the issue was sold at in June, part of the company’s $25 billion debt deal .
Nvidia Among Top Traded US Credit Swaps as Hedging Demand Soars
Premiums on Meta Platforms Inc.’s 6.45% notes due 2066 widened 5 basis points to 189 basis points, according to Trace. Spreads for Skydance Corp.’s 8.9% 40-year bonds widened 7 basis points to 342 basis points, just days after that security was sold at 330 basis points.
Hyperscalers, data centers and other AI infrastructure projects have borrowed around $370 billion worldwide in investment-grade and high-yield corporate bond markets this year, up from around $125 billion in all of 2025, according to data compiled by Bloomberg.
“Debt investors have little tolerance for credits that require materially more leverage to fund growth,” said Grant Nachman, founder and chief investment officer of Shorecliff Asset Management Co. “With AI-related financing needs this large, creditors focus on how much debt gets issued now, not the cash flows that may materialize later.”
Click here for Bloomberg News’ AI Debt Tracker
Nvidia owned about 1.5% of SpaceX shares as of June 30, according to a regulatory filing , worth about $21 billion as of Tuesday’s close.
The worldwide expansion of computing capacity has sent the cost of everything from land to chips and power-generation equipment soaring, touching off a series of massive financing deals. Broadcom Inc.’s Wall Street syndicate is starting to gather $60 billion of fresh AI chip financing to benefit Anthropic PBC and other companies, people familiar with the matter said just days ago.