X, xAI Plan Full Repayment of USD 17.5 Billion Debt
- 3 days ago
- 2 min read
X, the social media platform, and artificial intelligence startup xAI plan to fully repay approximately USD 17.5 billion in company debt. Morgan Stanley, which manages the debt for both organisations, has been informing existing lenders of this plan.
This repayment includes xAI's USD 3 billion of high-yield bonds, which are set to be redeemed at approximately USD 1.17 on the dollar. This premium reflects the expectation that the debt would have remained outstanding for at least two years.
When companies repay bonds ahead of schedule, they typically must compensate investors with a penalty, plus the interest lenders had expected to earn over the original term. Some of the debt has been outstanding for years, though portions are less than a year old and carry penalties.
The companies have not revealed where the capital for these repayments is coming from. Morgan Stanley subsequently led a USD 5 billion debt package for xAI.
In Jan., xAI raised USD 20 billion in a Series E funding round. In 2025, X carried USD 12 billion of debt, which was subsequently tied to xAI's financial obligations as part of the overall repayment plan.
These repayment plans follow a series of major corporate manoeuvres. SpaceX acquired xAI in Feb., in a deal that valued the AI startup at USD 250 billion.
This acquisition gave the aerospace company greater flexibility to restructure xAI's capital. The rocket maker is preparing an initial public offering later this year, ahead of which Elon Musk overhauled xAI's management.
X and xAI plan to fully repay approximately USD 17.5 billion in debt.
Morgan Stanley, managing the debt, is informing existing lenders of the repayment plan.
xAI's USD 3 billion high-yield bonds will be redeemed at a premium, reflecting their expected term.
Source: REUTERS
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