Musk raises $40 billion debt for SpaceX compute, claims neoclouds cannot finance
Elon Musk announced that SpaceX raised $40 billion in debt to purchase compute, managed by Apollo. He claimed that neocloud competitors can no longer raise debt due to high interest rates, a move analysts view as a strategy to depress competitor valuations.
Elon Musk announced on X that he raised $40 billion in debt for SpaceX to purchase compute, managed by Apollo. He claimed that neocloud competitors like CoreWeave and Nebius can no longer raise debt due to high interest rates, which have risen to 15% for data center financing. The analyst suggests this move may be a strategy to depress competitor valuations, allowing SpaceX, valued at 60x revenue, to acquire their assets via share swap.
Apollo's chief economist, Mr. Slock, recently published an analysis stating that corporate AI usage shows zero financial benefits or payoff in productivity statistics, citing the Solow Productivity Paradox. The analyst views Musk's announcement as a form of stock market manipulation and a potential precursor to acquiring neocloud competitors. This development underscores the intense financial competition in the AI compute sector.