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Elon Musk’s artificial intelligence company, xAI, has purchased his social media network, X, in an all-stock transaction, the billionaire Trump adviser announced on Friday.
“This combination will unlock immense potential by blending xAI’s advanced AI capability and expertise with X’s massive reach,” Musk wrote on X. “The combined company will deliver smarter, more meaningful experiences to billions of people while staying true to our core mission of seeking truth and advancing knowledge.”
The deal values xAI at $80 billion and X alone at $33 billion, including its debts, well below Musk’s roughly $44 billion purchase price for the social network in 2022.
X users already had access to xAI’s Grok chatbot, and the social network reportedly already had a stake in the AI company, but the tie-up could bring new advantages to Musk.
Some saw the merger as a way for the billionaire to help his investors recoup the diminished value of their stakes in X, which some investors have marked down by more than 70 percent since backing Musk’s takeover.
The move will also likely bear on how Musk competes with OpenAI, the artificial intelligence lab he co-founded as a non-profit in 2015, then later left.
Since then, Musk has pursued legal action against the highly capitalized outfit, arguing it abandoned the original altruistic mission he helped fund, while also claiming he wants to buy OpenAI.
Further complicating matters, the White House has touted the rival OpenAI’s role in Project Stargate, a recently announced joint partnership of OpenAI, Oracle, and SoftBank with promises to invest up to $500 billion dollars to grow A.I in America.
Outside of its chatbot product, xAI is also developing a supercomputer project in Memphis.
Musk is surely hoping for an economic win after a bruising few months for one of his other companies, Tesla, which has seen both poor financial performance and vigilante attacks against its cars and dealerships amid the billionaire’s highly visible role within the Trump administration.
