XAI
Elon Musk is done running separate companies
SpaceX has confirmed it is acquiring xAI, Elon Musk’s AI company behind the Grok chatbot, further combining his businesses under one structure.
The financial terms were not disclosed, but a source familiar with the deal said xAI was valued at $125bn (£91bn) and SpaceX at $1tn, making SpaceX the most valuable private company in the world.
In a memo, Musk said the merger would bring together AI, space launch, satellite internet, and media capabilities.
xAI began inside X after Musk bought the platform in 2022, using its real-time data to train AI models.
It became a standalone company in 2025 and was later valued more highly than X.
In brief:
SpaceX is absorbing xAI as part of Musk’s wider push to unify AI, space, and infrastructure projects.
The deal comes amid regulatory scrutiny of xAI’s Grok chatbot and ahead of a potential IPO.
Investors see this as a long-term strategy, with outcomes measured in decades, not years.
Think decades, not quarters
Its Grok chatbot has recently faced scrutiny, with both the European Commission and UK regulator Ofcom investigating concerns over AI-generated sexualised images. xAI said it has since added tighter controls.
The move follows Tesla’s $2bn investment in xAI last month and comes as SpaceX is reportedly preparing for a possible public listing.
Analysts say consolidating Musk’s companies could help present a clearer growth story to future investors, though any real-world benefits from space-based AI are expected to take decades.
AI, rockets, satellites. Normal side projects. - MG