Elon Musk has announced the merger of his artificial intelligence startup, xAI, with his social media platform, X, in an all-stock deal valued at $33 billion. This move brings xAI’s valuation to $80 billion, while X is valued at $33 billion. Both companies are privately held under Musk’s control and share major investors, including Andreessen Horowitz, Sequoia Capital, Fidelity Management, Vy Capital, and Saudi Arabia’s Kingdom Holding Co.
Musk stated that the merger would combine the companies’ data, computing power, distribution, and talent to create more advanced AI-driven experiences. He emphasized their shared mission of seeking truth and advancing knowledge, positioning the combined entity to accelerate human progress.
Founded less than two years ago, xAI has quickly become a major AI player, developing large language models and AI tools in direct competition with OpenAI. The company is also building a supercomputer, Colossus, in Memphis, Tennessee, to power its AI chatbot, Grok. However, its rapid expansion has faced scrutiny from environmental and public health advocates due to concerns about community input and energy use.
