SpaceX is seeking $40B in debt to buy Nvidia chips, days after Ray Dalio warned that AI borrowing is nearing a bubble burst.
SpaceX wants $40 billion in fresh debt, with the proceeds earmarked for Nvidia chips. The move comes just days after billionaire investor Ray Dalio said AI-related borrowing has taken markets to the brink of a bubble burst.
The space company took in nearly $86 billion from its June listing. Weeks after that, it issued another $25 billion in bonds.
At a Forbes conference in Singapore on Wednesday, Bridgewater Associates founder Ray Dalio described AI as a “classic bubble.”
Debt and climbing interest rates are at the heart of his worry. Bubbles tend to burst, Dalio said, when investors sitting on paper profits sell off to free up cash.
“We’re in the part of the cycle that is before that but approaching that. I think we’re close to that,” he said.
Elon Musk’s AI operation xAI was folded into SpaceX in February, and the company now spends more on AI than its rocket and Starlink units bring in. Under the planned deal, $10 billion would come from bank loans and $30 billion from bonds, the FT reports.
BREAKING: Elon Musk's SpaceX is in talks to raise $40 Billion in debt to buy Nvidia chips, per FT.
— Bull Theory (@BullTheoryio), October 7, 2026
The financing could include $10 billion in bank loans and $30 billion in investment-grade debt, led by Apollo.
SpaceX’s credit standing is BBB, which puts it two levels below Meta and Alphabet.
In August, Morgan Stanley’s Adam Jonas said SpaceX might have to raise roughly $80 billion each year through 2035, as reported by The Motley Fool.
Nvidia would receive the funds, and each of the 35 Wall Street analysts covering the chipmaker has a buy rating on NVDA; their average target comes to $324.20.
Whether the added borrowing will pay off is a question that divides Wall Street. Among the 35 analysts who follow SpaceX, 28 have buy ratings, five say hold and two say sell.
On average, the 12-month target on SpaceX is $216.21, roughly 33% above Friday’s close of $162.57. The low end is $75 and the high end is $450.
At Friday’s close, SpaceX shares were $162.57, nearly 28% under their 52-week peak. A tranche of 1.31 billion insider shares becomes free to trade once third-quarter numbers are out.
Writing for The Motley Fool, Jeremy Bowman argued that SpaceX would probably be the first casualty in any bubble burst, while adding that he does not expect one soon.
Other companies carry similar exposure. Anthropic holds $518 billion in future computing commitments, while OpenAI’s total is $665 billion, per the Fool. After questions arose about OpenAI’s revenue, Oracle shares fell on Thursday.
Dalio’s caution links all that outlay to a single factor. Should rates continue to climb, he said, the motivation to sell will mount.
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