SpaceX’s plans to buy more Nvidia GPUs is keeping Jim Cramer bullish on the chip stock

SpaceX is lending more support to the bull case on Nvidia, according to Jim Cramer. The Elon Musk-led rocket and AI company is looking to raise $40 billion to buy more Nvidia chips. In a story first reported by the Financial Times and later confirmed by CNBC, Apollo Global Management and a consortium of other banks are in early talks about helping finance the deal. CNBC sources said there was no timeline on when it would close. The FT said the deal could include $10 billion in bank loans and an additional $30 billion in investment-grade debt. Back in June, SpaceX also raised $25 billion in a debt sale to fund its AI ambitions, which includes renting out compute to customers such as Anthropic and Alphabet's Google. It came less than two weeks after its record initial public offering. During Wednesday's Morning Meeting , Jim Cramer said he is excited about SpaceX's efforts to secure more capital for Nvidia's chips. "The more Nvidia [that SpaceX] buys, the more money it makes." Jim added, "Musk is doing what [Nvidia CEO Jensen Huang] outlined, which is to say, 'Buy our compute and then lend it, and you'll make a fortune." Musk's message is clear, Jim continued. "The most powerful person in the world saying, 'You know what? If you want to make money, buy Nvidia chips.'" Jim's comments on Wednesday call back to one of his big takeaways from Nvidia's August earnings report: the demand for Nvidia's chips is so strong because customers are finding it profitable to invest in them. Jim believes that cuts against the bearish argument that AI compute investments are out of control, with uncertain returns. On Nvidia's August earnings call, Huang said he recently heard that "return on investment capital is now less than a year. And we're talking about $50 billion data centers. So, that tells you something about the productivity of Nvidia's technology and the rentability of it." While dropping roughly 2.5% in Wednesday's tough market for tech stocks, SpaceX has been on the march lately — up nearly 60% since its all-time low of roughly $105 on Aug. 3. The IPO was priced at $135. The stock soared to an all-time high of above $225 shortly after its June 12 debut, before falling on tough times. However, the stock has gotten past the first IPO lockup expiration in early August, which was feared to be a negative catalyst. It's also benefited from improving sentiment around some AI infrastructure stocks in recent weeks. In a note to clients Sunday, Morgan Stanley called the stock "cheap and getting cheaper." SpaceX's foray into renting out AI compute this year is proving to be a lucrative endeavor for a company best known for its Starlink internet service and rocket ambitions. It also owns the social media service X, the Grok chatbot, and the recently acquired Cursor coding assistant. Wall Street is projecting SpaceX's AI segment will bring in $6.22 billion in revenue in the September quarter, before jumping to $11.27 billion in the December period. In August, Musk pledged to buy only Nvidia chips for SpaceX. "We've decided to build exclusively on Nvidia because we think the Vera Rubin architecture is the best architecture. We think it's the best AI computer and we greatly value our close cooperation and partnership on many levels with Nvidia. So, we're exclusive to Nvidia," Musk said at the time. Nvidia shares dropped less than 1% on Wednesday after closing at back-to-back record highs. The stock has been gaining momentum since the company announced on Sept. 28 that it was boosting its buyback program by $150 billion to $235 billion. The move was welcome news for Jim, who had been pushing Nvidia to launch an Apple -style repurchase program to support the stock. Jim wants Nvidia to perform an "active buyback," so it's capable of stepping in late in the session when options traders may be knocking down shares. (Jim Cramer's Charitable Trust is long NVDA. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.