In a $33 billion agreement, Elon Musk’s AI business buys out X, a social networking platform.
Musk stated on X that his artificial intelligence business, xAI, was worth $80 billion in the sale.
Elon Musk announced on Friday that his social networking platform, X, has been bought by his artificial intelligence business, XAI.
He said that X was worth $33 billion and that the sale was an all-stock transaction.
The fates of xAI and X are interwoven. In a post on X, Musk stated, “Today, we formally take the step to combine the data, models, compute, distribution, and talent.”
The deal combines two of Musk’s most well-known businesses, but little information about it was released to the public outside of Musk’s post because the businesses are not publicly traded. It’s unclear if Musk received any immediate benefits from the deal.
Bloomberg reports that X recently raised $1 billion from investors, valuing the company at $44 billion. At almost the same price, Musk went private with X (then Twitter) in 2022. Recently, Musk received a summons from the SEC in the ongoing case concerning his purported failure to reveal his ownership stake in Twitter before placing a bid to acquire the entire company.
Musk’s statement was reposted by X CEO Linda Yaccarino, who added, “The future could not be brighter.”
Musk introduced Grok, an AI-powered chatbot that is comparable to those from OpenAI, Google, Microsoft, and numerous other AI startups, together with xAI in 2023. Since then, Grok has been integrated into X, and a lot of users now frequently ask it to comment on posts and debates.
Musk has portrayed Grok as a “truth-seeking,” anti-” woke” AI, yet it has been shown to disagree with him on a wide range of topics.
“This combination will unlock immense potential by blending xAI’s advanced AI capability and expertise with X’s massive reach,” Must stated. “Billions of people will receive better, more meaningful experiences from the merged firm while adhering to our basic objective of pursuing knowledge and the truth. This will enable us to create a platform that actively advances human progress rather than merely reflecting the world.
Musk’s xAI has drawn interest from investors amid the wider surge in AI startups. In December, leading semiconductor makers Nvidia and AMD, as well as Wall Street firms Blackrock, Fidelity, Morgan Stanley, and Sequoia Capital, made investments in xAI. The AI company’s worth increased to $45 billion as a result of the funding. According to sources as recently as last month, xAI was thinking about raising $75 billion in a new round of funding.
The haste to create and invest in advanced artificial intelligence has resulted in plans to invest billions of dollars in building out the infrastructure for electricity, computer capacity, and human capital needed to create increasingly complicated models. While internet behemoths like Google, Amazon, and Meta have declared plans to spend heavily on all things AI, money has flooded into AI startups.
In the meantime, Musk and AI have become more politicized. Musk has become one of President Donald Trump’s most well-known advisors, and Trump used AI as a campaign issue, vowing to limit its use. Trump signed an executive order a few days into his second term that tried to reverse the Biden administration’s attempts to promote the development of AI while putting some restrictions on it.
Numerous tech and AI CEOs, technologists, and industry watchdogs have cautioned about the potential consequences of a full-scale weapons race in AI, especially as China and other nations vie for supremacy in the field.
