SpaceX successfully raised $25 billion in its debut bond offering on Tuesday, drawing nearly $90 billion in orders, according to sources cited by CNBC. The debt sale comes less than two weeks after the company's initial public offering, which saw shares briefly dip below the debut price amid a $600 billion tech market sell-off. Shares later recovered 2.4 percent, Bloomberg reported.
The bond deal, structured in five parts, pays a relatively wide premium over Treasuries to attract investors, people familiar with the matter told Bloomberg. The offering marks a critical test of investor appetite for Musk's sprawling empire, which spans rocketry, satellite internet, and artificial intelligence. That the company is raising debt so soon after its equity debut signals aggressive capital needs for its Starship program and Starlink expansion.
Nearly $90 billion in orders flooded in, CNBC reported, signaling robust demand despite the recent market turbulence. The oversubscription suggests institutional investors view SpaceX's growth trajectory favorably, even as the broader tech sector faces headwinds. The company did not disclose how it will allocate the bond proceeds.
The debt raise gives SpaceX financial flexibility to accelerate production and research. It also exposes the firm to higher interest costs given the premium spread. For competitors in launch services and satellite broadband, the capital infusion could intensify an already competitive landscape.
Some analysts caution that the generous pricing reflects risk premiums for Musk's ventures, which have a history of missed deadlines and regulatory hurdles. The bond's performance in secondary trading will be a key test of sustained investor confidence.