Elon Musk’s xAI Acquires Social Media Platform X in $33 Billion All-Stock Deal
Elon Musk announced on Friday that his artificial intelligence startup, xAI, has acquired his social media platform, X, in an all-stock transaction valued at $33 billion. Musk revealed the deal in a post on X, stating that the futures of xAI and X are ‘intertwined’ and that the combination will ‘unlock immense potential’ by blending xAI’s advanced AI capability with X’s massive reach.
The acquisition brings together two of Musk’s most high-profile companies, although details of the deal remain undisclosed as neither company is publicly traded. This development comes after X recently raised $1 billion from investors, valuing it at $44 billion, according to Bloomberg. Musk took X private in 2022 at a similar valuation.
Musk launched xAI in 2023 and introduced Grok, an AI-powered chatbot designed to be ‘seek truth and challenge what he calls ‘woke’ AI. Grok has since been integrated into X, allowing users to interact with the chatbot. Despite Musk’s description of Grok as ‘truth-seeking,’ it has disagreed with him on various issues.
The acquisition is part of a broader boom in AI development, with significant investment pouring into AI startups and tech giants announcing plans for substantial AI-related spending. xAI itself received funding from major investors like Blackrock, Fidelity, and Nvidia in December, valuing the company at $45 billion. Reports suggest xAI is considering another fundraising round that could value the company at $75 billion.
As AI development accelerates, it has become increasingly politicized, with Musk emerging as a key adviser to former President Donald Trump. Trump has made AI a campaign issue, promising to reduce regulation. Just days into his second term, Trump signed an executive order aimed at undoing Biden administration efforts to safeguard AI development while encouraging its growth.
The rapid advancement of AI has raised concerns among industry leaders and watchdogs about the implications of an all-out AI arms race, particularly as countries like China push to lead in the technology. Critics warn about the potential risks and consequences of unregulated AI development.
