Musk says SpaceX closed $40 billion of debt for GPUs and predicts most neoclouds will die

On October 25, Elon Musk replied on X to a post by investor Chamath Palihapitiya, who had written that there will be more partially stranded compute in 2027 than is currently forecast. Musk said that in recent weeks debt markets have almost entirely shut off access to money for any company without substantial revenue independent of AI data centers. “SpaceX closed $40B of debt for GPUs, but we’re investment grade and have Starlink & launch revenue,” he wrote. “That means the 200+ neoclouds are going to see guppy-level death and consolidation. Some will make it through, but not many.”

In a follow-up post, Musk said it is “primarily callable debt for GPU purchases that will arrive in Q1 and Q2,” and “not a major factor this quarter.” Bloomberg reported the same day that talks were still ongoing despite Musk’s claim. Per investingLive, Bloomberg said Goldman Sachs is leading investor talks. The Financial Times had reported Apollo-led talks in early October.

A filing SpaceX made with the Securities and Exchange Commission on October 26 clarifies the picture. On October 24, the company signed a binding commitment letter with an entity managed by Apollo Global Management, which will buy GPU pods and lease them to SpaceX for about five years. Aggregate principal payments are expected to total about $40 billion. The fixed rate will be set at pricing, and the deal is subject to closing conditions and expected to close before year end.