SpaceX's Elon Musk reveals $40 billion in debt for AI chips, warns of neoclouds

SpaceX ( SPCX ) CEO Elon Musk said his company closed on $40 billion in financing to pay for specialized chips used to power AI, but warned that access to debt is drying up for companies that solely rely on data center revenue.

"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," wrote Musk on X on Sunday.

Musk went on to say that SpaceX ( SPCX ) closed $40 billion in debt for Nvidia's ( NVDA ) GPUS, or graphics processing units, used for AI, but highlighted that the space company is "investment-grade" and has Starlink & rocket launch revenue.

In a follow-up post, Musk noted this "is primarily callable debt for GPU purchases that will arrive in Q1 and Q2. Not a major factor this quarter."

Musk's comments reignited concerns about the rising cost of capital and the business models of so-called neoclouds, which rent computing power to train and run AI models.

The debt disclosure comes on the heels of SpaceX's better-than-expected quarter.

The company's AI segment brought in $7.6 billion in the third quarter, more than Starlink and the rocket business combined, and more than half of SpaceX's $14.6 billion in total revenue.

Musk also took a shot at neoclouds, companies that rent out computing power and AI chips, saying they are "going to see guppy-level death and consolidation."

"Some will make it through, but not many," said Musk.

The comments following a viral chart earlier this month highlighted neocloud provider CoreWeave's ( CRWV ) spiking bond yields, underscoring concerns about the company's debt-heavy balance sheet.

Shares of CoreWeave recovered during Monday's session after opening in red territory. The stock has tumbled more than 30% over the past month.

Ines Ferre is a senior business reporter for Yahoo Finance.