SpaceX Apollo Chip Lease: $40 Billion, About as Big as All Its Debt
SpaceX has committed to rent AI chips from an entity run by investment firm Apollo and to pay off about $40 billion of their cost over about five years from 2027. That is about as big as all its debt, $38.0 billion on September 30, and means about $2 billion every three months, before interest, once every chip arrives.
The short answer. Instead of buying its next AI computers, SpaceX agreed to rent them from an Apollo-managed entity that will own them, and to pay off their cost every three months. It shows how the AI boom is being paid for, since even a company with plenty of cash is renting its chips, on a bill about as big as all its debt. We worked out that the chip cost alone comes to about $2 billion a quarter once every chip arrives. SpaceX’s existing hardware leases with Valor, a firm founded by one of its directors, already account for about half of the interest expense it reported.
SpaceX's AI chip lease in three numbers
What we calculated
- About $2 billion of chip cost every three months once all the chips arrive, or $8 billion a year in 2028 to 2031: one twentieth of about $40 billion, paid each quarter, before interest.
- About $1 billion of interest over the life of the lease for each percentage point of rate: the rate applied to the balance still owed, which shrinks by one twentieth a quarter.
- About 52% of the third quarter interest expense SpaceX reported, which leaves out interest added to construction costs, came from its hardware leases with Valor: $351 million out of $675 million.
- Debt for the Valor leases nearly tripled in nine months: $12.9 billion on September 30 against $4.5 billion at the end of 2025, 2.86 times.
- Most of Starlink’s operating profit: about $2 billion of quarterly chip cost against $2.4 billion in the third quarter, about 85%.
- Less than half of SpaceX’s cash and short-term investments: about $40 billion against $89.9 billion on September 30, about 45%.
- Nearly three times the debt due in 2028: about $8 billion a year of lease principal against $2.9 billion of scheduled debt repayments.
- About three times the Valor lease debt: about $40 billion of expected principal against $12.9 billion still recorded.
- $12.9 billion of debt for the Valor leases on September 30: the short and long term amounts in SpaceX’s quarterly report added together.
- About $10.0 billion more spent on equipment and buildings than SpaceX’s operations brought in during the third quarter: $19.6 billion against $9.6 billion, the latter from two quarterly reports.
On this page
What is SpaceX leasing from Apollo?
SpaceX is renting the computer chips that run AI programs, a deal about the size of all its debt. An entity managed by Apollo, a large investment firm, will buy the chips and own them, and SpaceX will use them in data centers it picks.
The filing’s own words are “graphics processing unit pods and related equipment”. A graphics processing unit, or GPU, is a chip first built to draw video game images that now does most of the arithmetic behind AI models such as SpaceX’s Grok. A pod is a large group of them wired to work as one machine. The 8-K filed on October 26, the form companies use to tell the SEC, the US markets regulator, about a major event, does not say how many chips there are or who makes them.
A $40 billion chip deal was not a secret. Reuters reported on October 25 that Elon Musk had said in a post on X that SpaceX “had closed $40 billion in debt financing for graphics processing units”. The filing is SpaceX’s own account, and it reads differently. It is a lease, so the Apollo entity owns the chips. What SpaceX signed on October 24 is a binding commitment letter, a signed promise to enter the lease. The lease still has conditions to meet and is expected to close before the end of 2026.
The filing names no business that will use the chips. In our reading they fit SpaceX’s AI business, which sells Grok and rents computing power to other companies, and which spent $16.4 billion on equipment and buildings in the third quarter alone, as StockTitan found in its look at SpaceX’s third quarter.
How does the SpaceX chip lease work?
SpaceX pays every three months, in advance. Each payment returns one twentieth of the chips’ cost plus interest, so after 20 payments, about five years, their cost is paid off.
- Apollo entity buys the chips An entity managed by Apollo buys GPU pods and related equipment, and owns them.
- Chips arrive in batches Batches are delivered from the first half of 2027 to data centers SpaceX picks.
- SpaceX pays every three months Each payment, made in advance, is one twentieth of the batch's cost plus interest and costs.
- Paid off in about five years After 20 payments SpaceX has paid back about $40B of cost in total.
The chips arrive in batches, and each batch gets its own lease of about five to five and a quarter years. Deliveries are expected in the first half of 2027, and each lease starts “upon delivery of the GPUs”, in the filing’s words.
Each quarterly rent is mostly one twentieth of what that batch cost, which the filing calls principal. On top come interest at a fixed yearly rate on what is still owed and “certain ongoing costs and expenses”. The rate is not set yet. SpaceX says it will be fixed at pricing, a step that comes before it signs the lease itself.
Take a $10 billion batch of chips. SpaceX would pay back $500 million of the cost every three months for five years, and on top of that interest on whatever is still owed, a sum that shrinks by $500 million with every payment.
The filing calls this a finance lease, which works much like buying on credit. The renter pays off the cost and interest, as a borrower would, while the Apollo entity keeps the title to the chips. Musk called it debt financing. The filing does not say what happens to the chips when each lease ends.
The rate matters. In our calculation every percentage point of rate adds about $1 billion of interest over the life of the lease. For scale, the bonds SpaceX sold in June pay an average of 5.855% a year, according to its quarterly report, which is not a forecast of the Apollo rate.
How does SpaceX’s $40 billion lease compare with its debt and cash?
It is about as big as everything SpaceX owed lenders at the end of September, $38.0 billion. It is also about what its AI business spent on equipment and buildings in the first nine months of 2026.
The $38.0 billion is the debt SpaceX reported on September 30, mostly bonds it sold in June. It already includes $12.9 billion recorded for leases of AI hardware, covered below. The lease is not in that number, because SpaceX signed the commitment after the quarter ended.
Show the data
| Category | Value |
|---|---|
| Sep 30 cash and investments | $89.9B |
| Apollo lease, 2027 to 2032 | $40.0B |
| AI buildout, Jan to Sep 2026 | $40.0B |
| All debt, Sep 30 | $38.0B |
On paper SpaceX could have paid cash. It held $89.9 billion in cash and short-term investments on September 30, after a June share sale that raised $85.7 billion after fees. The filing gives no reason for renting instead, and we do not guess one.
That cash is also being spent fast. In the third quarter SpaceX put $19.6 billion into equipment and buildings, about $10.0 billion more than its operations brought in. That gap is one quarter’s history, not a forecast, and it is the backdrop against which the lease payments will start.
Show the data
| Measure | Amount | Date or period |
|---|---|---|
| Apollo lease, expected principal | About $40.0B | Paid over about five years from the first half of 2027 |
| Total debt, principal | $38.0B | September 30, 2026 |
| Of which bonds sold in June 2026 | $25.0B | September 30, 2026 |
| Total debt and finance leases, principal | $39.0B | September 30, 2026 |
| Cash, cash equivalents and short-term marketable securities | $89.9B | September 30, 2026 |
| AI business spending on equipment and buildings | $40.0B | January to September 2026 |
| Spending on equipment and buildings, all businesses | $19.6B | Third quarter of 2026 |
| Cash from operations | $9.6B | Third quarter of 2026 |
Source: SpaceX Form 8-K of October 26, 2026; Form 10-Q for the quarter ended September 30, 2026, Note 9, balance sheet and cash flow statement; Form 10-Q for the quarter ended June 30, 2026; third quarter 2026 results release.
How much will SpaceX pay each year for the Apollo lease?
Once all the chips have arrived, about $8 billion a year of their cost, plus interest. That is nearly three times the debt SpaceX already has due in 2028.
The payments build up during 2027 as each batch is delivered and starts its own lease, so the first year is a ramp. Every batch is expected to start by the end of June 2027 and has 20 quarterly payments. So each year from 2028 through 2031 carries four full payments on all of them, and the last leases end in 2032.
Show the data
| Category | Debt already due (10-Q) | Apollo lease, our estimate |
|---|---|---|
| 2028 | $2.9B | $8.0B |
| 2029 | $3.4B | $8.0B |
| 2030 | $3.6B | $8.0B |
From 2028 to 2030, SpaceX’s scheduled debt repayments were modest before this lease, between $2.9 billion and $3.6 billion a year. Its quarterly report also says “no material debt principal payments are due until July 15, 2031” on its June bonds. The lease changes that picture.
Starlink gives a sense of scale, and only of scale, since operating profit is not the same as spare cash. SpaceX’s satellite internet service made $2.4 billion of operating profit in the third quarter, the profit from running the business before interest and taxes. Once every chip is in place, the lease’s quarterly principal of about $2 billion would equal most of that.
Has SpaceX leased AI hardware before?
Yes, on a smaller scale. SpaceX already rents AI hardware from Valor Equity Partners, a firm founded by one of its directors, and the debt it records for those leases nearly tripled this year to $12.9 billion.
The 10-Q, SpaceX’s quarterly report to the SEC, describes “equipment lease agreements with Valor Equity Partners” for AI hardware, signed by SpaceX’s subsidiary CTC Property. Valor’s founder, Antonio Gracias, “serves as one of the directors of the Company”, the filing says.
The filing calls them “failed sale-leaseback” transactions. In a sale and leaseback a company sells equipment and rents it back, and here the accounting rules did not count the sale, so SpaceX books the deals as debt. The chart below shows how fast that debt grew during 2026.
Show the data
| Category | Value |
|---|---|
| Valor leases, Dec 31, 2025 | $4.5B |
| Valor leases, Sept 30, 2026 | $12.9B |
| Apollo lease, expected | $40.0B |
Those leases accounted for $351 million of interest in the third quarter, about half of the interest expense SpaceX reported. That reported figure leaves out interest SpaceX added to the cost of construction projects. The Apollo lease’s expected principal is about three times the debt still recorded for them.
Apollo has financed AI chips for this business before, for xAI, the AI company SpaceX bought on February 2, 2026. In a January 2026 release, Apollo said its funds led a $3.5 billion financing for a Valor fund’s “$5.4 billion acquisition and lease of data center compute infrastructure, including NVIDIA GB200 GPUs, to a subsidiary of xAI Corp”. Neither company says whether that deal is among the Valor leases in the 10-Q.
In our reading, the filings show SpaceX leaning more on rented hardware: its existing lease debt grew during 2026, and the Apollo commitment would add about three times as much again. What that will cost in the end depends on a rate that is not set yet.
What to watch
- The interest rate: SpaceX sets it at pricing, before it signs the master lease, the main contract, which it expects before the end of 2026. A later 8-K or its 2026 annual report on Form 10-K may show it.
- Whether the lease closes on these terms: the filing says it is subject to closing conditions without listing them. A later 8-K or the 10-K may disclose the signed lease and its terms.
- What happens to the chips when each lease ends: the 8-K does not say, and the signed master lease, if SpaceX files it, would.
- When the chips arrive and payments begin: the first half of 2027, in SpaceX’s quarterly reports for the first and second quarters of 2027.
How we counted
Every figure comes from SpaceX’s Form 8-K filed on October 26, 2026, its Form 10-Q for the quarter ended September 30, 2026, and its third quarter results release of October 20, 2026. The third quarter cash figure also uses its Form 10-Q for the quarter ended June 30, 2026.
Quarterly principal is about $40 billion divided by 20, since rent includes one twentieth of each batch’s cost per quarter, which the filing says rent will “generally” include. The yearly figure assumes the full $40 billion is leased and every batch starts between January and June 2027. Interest and ongoing costs are left out. The 2028 to 2030 debt figures are the scheduled principal in the 10-Q, Note 9, rounded.
For interest, the balance owed falls by one twentieth of the cost each quarter. Over a lease it averages 9.5 twentieths of the cost if interest is charged after each payment, or 10.5 twentieths if before. For $40 billion over five years that is $95 billion to $105 billion of balance years, so each percentage point of rate adds $0.95 billion to $1.05 billion.
Third quarter cash from operations is $13,097 million for nine months less $3,466 million for six months, or $9,631 million, against $19,593 million of spending on equipment and buildings. The Valor debt adds the current and long term amounts in Note 17: $2,181 million and $10,716 million on September 30, against $455 million and $4,052 million on December 31, 2025. Interest expense is the 10-Q’s figure, which is net of interest capitalized into construction projects. Other ratios: $2 billion against Starlink’s $2,367 million of third quarter operating profit is about 85%; $40 billion against $89,855 million of cash and short-term investments is about 45%; $12,897 million against $4,507 million is 2.86 times. Ratios are rounded.
Frequently asked questions
Who is SpaceX leasing AI chips from?
From an entity managed by Apollo Global Management, according to SpaceX’s 8-K of October 26, 2026. That entity will buy the GPU pods and lease them to SpaceX.
Is SpaceX’s $40 billion deal debt?
It is a finance lease, which works much like buying on credit: SpaceX pays off the chips’ cost plus interest over about five years. Musk described it as debt financing in a post reported by Reuters on October 25.
Has SpaceX’s Apollo chip lease closed?
Not yet. On October 24 SpaceX signed a binding commitment letter, and it expects the lease itself to close before the end of 2026, subject to closing conditions.
Does the SpaceX Apollo deal use Nvidia chips?
The filing does not name the chipmaker. It says only “graphics processing unit pods and related equipment”.
When does SpaceX start paying for the leased chips?
When each batch is delivered, which SpaceX expects in the first half of 2027. Rent is paid every three months in advance, and the leases run about five years, so the last ones end in 2032.
How much debt does SpaceX have?
$38.0 billion of debt on September 30, 2026, or $39.0 billion counting its existing finance leases, according to its quarterly report. The Apollo lease came after that date. The full 8-K on the lease is on StockTitan.
Sources
- StockTitan: SpaceX Form 8-K on the Apollo lease, October 26, 2026
- StockTitan: SpaceX Form 10-Q for the third quarter of 2026
- StockTitan: SpaceX (SPCX) financials
- StockTitan: SpaceX (SPCX) stock overview
- StockTitan: SpaceX Q3 2026 results, where its money comes from and what it spends on AI
- StockTitan: net debt explained
- StockTitan: Apollo release on Valor and xAI compute, January 7, 2026
- SpaceX Form 8-K, Item 8.01, filed October 26, 2026
- SpaceX Form 10-Q for the quarter ended September 30, 2026
- SpaceX third quarter 2026 results, Form 8-K, October 20, 2026
- SpaceX Form 10-Q for the quarter ended June 30, 2026
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