Elon Musk's companies, X and xAI, are planning to repay about $17.5 billion in debt in full, according to a report by Bloomberg News citing people familiar with the matter.
The move would wipe out billions in outstanding loans tied to the social media platform and the artificial intelligence startup.
Morgan Stanley, which manages the debt for both companies, has reportedly informed lenders that X and xAI intend to pay back everything they owe. The companies have not publicly explained where the money will come from.
According to Reuters, part of the repayment includes xAI's $3 billion in high-yield bonds. Sources reported those bonds are expected to be redeemed at about $1.17 on the dollar.
That price reflects a premium because investors believed the bonds would stay in place for at least two years.
When companies pay off bonds early, they often must cover penalties and the interest lenders expected to earn.
Some of the debt has been in place for years, while other portions are newer and may carry additional fees for early repayment. Paying it all off at once would mark a major financial shift for Musk's business empire.
Elon Musk's X, xAI plan to repay $17.5 billion in debt in full, Bloomberg News reports - https://t.co/FOn11RbE1h
— Mohd Abu Hamam (@MohdHamam) March 3, 2026
SpaceX Acquires xAI in $250B Deal
The plan follows a series of big corporate moves. In February, SpaceX acquired xAI in a deal that valued the AI company at $250 billion. The merger gave SpaceX more flexibility to adjust xAI's financial structure.
SpaceX is also preparing for an initial public offering later this year, and Musk recently reshaped xAI's management team.
In 2025, xAI acquired X, taking on roughly $12 billion in debt from the social media company. After that deal, Morgan Stanley led a $5 billion debt package for xAI, according to sources cited by Reuters.
Earlier this year, xAI also raised $20 billion in a Series E funding round, strengthening its financial position, Newsweek reported.
If completed, the repayment would clean up the balance sheets of both companies in one sweep. It could also improve investor confidence ahead of SpaceX's expected IPO.
Neither X nor xAI responded to requests for comment. Morgan Stanley also declined to comment, and Reuters said it could not independently verify Bloomberg's report.
Originally published on vcpost.com
