BASTROP, Texas: Elon Musk's social media platform X and artificial intelligence startup xAI plan to repay about US$17.5 billion in debt in full, Bloomberg News reported on March 2, citing people familiar with the matter.

Morgan Stanley, which manages the debt for both companies, has been notifying existing lenders of the repayment plans, the report said.

According to Bloomberg, xAI's $3 billion in high-yield bonds are expected to be redeemed at roughly $1.17 on the dollar, a premium that reflects expectations the debt would have remained outstanding for at least two years.

The report said the companies have not disclosed the source of the capital for the repayments.

When bonds are repaid ahead of schedule, issuers typically compensate investors with a penalty in addition to the interest lenders would have earned over the original term. Bloomberg said some of the debt has been outstanding for years, while other portions are less than a year old and carry penalties.

The reported repayment plans follow a series of major corporate moves involving Musk's businesses.

SpaceX acquired xAI in February in a deal that valued the AI startup at $250 billion, giving the rocket maker greater flexibility to restructure xAI's capital. SpaceX is preparing for an initial public offering later this year, and Musk overhauled xAI's management last month.

xAI acquired X in 2025, inheriting $12 billion in debt from the social media company as part of the transaction.

Morgan Stanley later led a $5 billion debt package for xAI, sources familiar with the matter previously told Reuters. In January, xAI raised $20 billion in a Series E funding round.

X and xAI did not immediately respond to requests for comment. Morgan Stanley declined to comment. Reuters was not able to independently verify the Bloomberg report.