Finance
Musk's xAI raises $5 billion each in fresh debt and equity, Morgan Stanley says
Published by Global Banking & Finance Review®
Posted on July 1, 2025
2 min readLast updated: January 23, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on July 1, 2025
2 min readLast updated: January 23, 2026
Elon Musk's xAI raised $10 billion in debt and equity to enhance AI infrastructure, with Morgan Stanley leading the effort.
(Reuters) -Elon Musk's xAI has completed a $5 billion debt raise alongside a separate $5 billion strategic equity investment, Morgan Stanley said on Monday, as the startup looks to expand its AI infrastructure through data centres amid intensifying competition in the industry.
The $5 billion raised in debt consists of financing of secured notes and term loans, Morgan Stanley in a statement posted on social media platform X. The deal was oversubscribed and included prominent global debt investors, it added.
Reuters earlier reported that xAI was on track to close on a $5 billion debt raise led by Morgan Stanley, despite tepid investor demand. In a separate report, Bloomberg News said that xAI was in talks to raise $4.3 billion through an equity investment on top of its $5 billion debt funding plans.
XAI did not immediately respond to a Reuters request for comment outside regular business hours.
The proceeds will support xAI's continued development of AI solutions, a data center and its flagship Grok platform, the bank said.
Apart from selling debt, xAI has also been in talks to raise about $20 billion in equity, which would value the company at more than $120 billion, with some investors placing valuations as high as $200 billion.
(Reporting by Ananya Palyekar and Gursimran Kaur in Bengaluru; Editing by Alan Barona)
xAI raised a total of $10 billion, consisting of $5 billion in debt and $5 billion in equity.
Morgan Stanley led the $5 billion debt raise for xAI.
The proceeds will support xAI's development of AI solutions, a data center, and its Grok platform.
The equity raise could value xAI at over $120 billion, with some investors estimating valuations as high as $200 billion.
xAI did not immediately respond to a Reuters request for comment outside regular business hours.
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