Musk says SpaceX's AI rivals are in trouble, sending their stocks lower

By Emily Bary and William Gavin

SpaceX just landed a $40 billion debt deal but Musk says lenders won't be so hospitable to less diversified competitors

Elon Musk said on X that SpaceX's diversified business model and investment-grade credit rating allowed it to raise debt.

Against a more cautious artificial-intelligence backdrop, Elon Musk said SpaceX was able to close a $40 billion debt deal - and he predicted that rivals wouldn't be so lucky.

The deal, he said on X, will allow SpaceX (SPCX) to purchase graphics processing units, a type of AI chip. SpaceX has been rapidly growing its neocloud business, which means that it's renting out access to chips to companies in need of AI processing power.

Musk said that SpaceX's investment-grade credit rating and its diversified business, which includes revenue from rockets and Starlink satellite technology, enabled it to land the deal.

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He didn't mince words when talking about SpaceX's rivals in the neocloud market. "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 in his Sunday X post.

That said, the neocloud Nebius Group (NBIS) just last week announced a $3.5 billion financing facility backed by Citigroup (C). In a statement, Nebius Chief Operating Officer Ophir Nave said it "demonstrates our ability to choose when and how we raise capital to support our growth."

Musk also predicted that "200+ neoclouds are going to see guppy-level death and consolidation."

"Some will make it through, but not many," he added.

Shares of CoreWeave (CRWV), a major neocloud, are down more than 2% in premarket action. Shares of Iren (IREN) are down 2%. Shares of Nebius are narrowly higher in premarket trading.

Musk suggested that his company wouldn't be part of any future industry consolidation, writing: "SpaceX is not buying any neoclouds. Pointless."

See also: SpaceX's massive AI targets will test the limits of reality

SpaceX confirmed the debt deal on Monday, saying that it had entered into a $40 billion binding commitment letter for a lease with an entity managed by Apollo Global Management (APO) to acquire GPUs and related equipment. The GPUs, reportedly from Musk's longtime business partner Nvidia (NVDA), will arrive in early next year.

The arrangement won't be a "major factor" during the ongoing quarter, Musk said on X.

In recent weeks, investors have grown more anxious about the AI-debt landscape, particularly as it relates to neocloud companies like CoreWeave that have relied on borrowed money to fuel their growth. The pressure on CoreWeave's bonds has sparked jitters across the technology landscape, in part due to the tight relationships that big companies have with one another.

CoreWeave didn't immediately respond to a MarketWatch request for comment on Musk's remarks.

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-Emily Bary -William Gavin

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10-26-26 0839ET