HAWTHORNE, California — SpaceX has closed a $40 billion debt financing deal to buy graphics processors for its fast-growing artificial intelligence business, Elon Musk announced on Sunday, even as he warned that debt markets have all but shut for smaller AI cloud companies that lack revenue outside data centers.
“As of the past few weeks, debt markets have almost entirely shut off access to money for any company that doesn’t have substantial revenue independent of AI data centers,” Musk said, according to Fox Business reporting of the announcement. Referring to the more than 200 so-called neocloud companies that rent out computing power built mainly for AI customers, he added: “That means the 200+ neoclouds are going to see guppy-level death and consolidation. Some will make it through, but not many.”
Musk said SpaceX could borrow on investment-grade terms because its established businesses — the Starlink satellite network and its rocket launch services — produce substantial revenue independent of AI, giving lenders security that pure-play computing startups cannot offer. SpaceX Chief Financial Officer Bret Johnsen said the company expects capital spending of $35 billion to $40 billion in the fourth quarter alone, according to Reuters, roughly double the previous quarter’s pace as the company races to bring new computing capacity online.
The financing follows a third quarter in which SpaceX’s revenue climbed 161 percent from a year earlier to $14.58 billion, according to Reuters, with net income of $4.4 billion, reversing a year-earlier loss. The AI division was the fastest-growing part of the business, and executives have said demand from companies seeking to lease computing power far exceeds supply, with payback periods on new investment that the company puts at about a year.
The announcement lands in the middle of a second, larger question hanging over Musk’s empire: whether SpaceX and Tesla should combine. Musk suggested last week that a merger of the two companies would be “a good idea,” and he has said both companies have formed special committees of independent directors to explore a potential deal. He has stressed that no merger is certain, and a combination would require approvals from the special committee, the board and shareholders — a process that, for SpaceX, also involves Musk himself as controlling shareholder, according to a mandatory disclosure reported by Reuters.
For investors, the two stories point in opposite directions. The $40 billion raise shows lenders still competing to fund the strongest names in the AI build-out, while Musk’s warning — and the deteriorating borrowing conditions he described — suggests the financing window is closing for the hundreds of smaller operators beneath them. Whether the Tesla–SpaceX committees recommend a deal, and on what terms, is expected to dominate the next stage of the story ahead of Tesla’s December shareholder meeting.
