SpaceX Sells $25 Billion of Bonds After Record IPO, Fueling Market Overheating Concerns

SpaceX is moving ahead with a $25 billion corporate bond sale shortly after raising a massive sum in what was described as the largest initial public offering on record, adding to concerns that global capital markets are overheating. Investors see the outsized fundraising across both equity and debt markets as a hallmark of strong appetite for risk assets.

The Financial Times reported on June 25 that Ludovic Subran, chief investment officer at Allianz, viewed the SpaceX bond sale as a sign that markets are moving beyond a healthy bull run and into bubble territory.

SpaceX recently raised about $86 billion through its IPO. It has now returned to the market with a $25 billion bond offering. Strong investor demand prompted the company to increase the deal size from an initial $20 billion.

The bonds were priced at a higher yield than debt issued by companies with the same credit rating. That indicates investors are assigning a high value to the company’s growth prospects while still demanding a premium for credit risk.

Equity and bond investors evaluate companies differently, Subran said. Bondholders care more about a company’s ability to make interest payments and repay principal than about its growth story.

Large US technology companies have continued to tap capital markets in recent weeks. With Anthropic and OpenAI also preparing for listings, investors say the market is entering a phase in which stock supply is increasing again after contracting during a period marked by share buybacks and companies going private.

The interest-rate backdrop is another variable. Futures markets have begun pricing in the possibility that the Federal Reserve will raise its benchmark rate by 0.25 percentage point at the October Federal Open Market Committee meeting. Higher rates could weigh on valuations for richly priced technology stocks.

Investors are also watching whether large-scale fundraising to support expanding AI investment can be sustained. As competition in data centers and AI infrastructure intensifies, technology companies may issue more bonds, potentially testing the credit market’s capacity to absorb the supply.