Musk’s xAI Acquires X in $33 Billion Deal
Elon Musk’s artificial intelligence company, xAI, has acquired the social media platform X (formerly Twitter) for $33 billion. This acquisition allows xAI to integrate X, enhancing its ability to train its AI chatbot, Grok [ xAI acquires X ].
What the Deal Means for xAI and X
Musk stated that xAI’s valuation is now $80 billion, while X is valued at $33 billion, factoring in $12 billion in debt. This deal strengthens the connection between xAI’s models and X, providing more data for Grok’s development.
Impact on Investors and Company Leadership
Prince Alwaleed bin Talal, a key investor in both X and xAI, noted that the merger would increase his company’s investment to $4–$5 billion. Though leadership integration details are unclear, analysts believe Musk is consolidating control over both companies.
Competition in the AI Industry
xAI competes with Microsoft-backed OpenAI and others like DeepSeek. Despite a failed bid to acquire OpenAI, Musk continues to advance xAI. Recently, the company launched Grok-3 and operates the world’s largest supercomputer, “Colossus,” in Memphis, Tennessee.
Financial Details and Debt Management
After Musk’s acquisition of Twitter (now X), seven banks that lent him $13 billion sold the debt once its value increased. The debt’s rise was driven by growing interest in AI and X’s improved performance.
Challenges and Controversies
Despite challenges such as a lawsuit from former Twitter shareholders and workforce cuts impacting X’s ad revenue, Musk’s influence—particularly in the Trump administration—has helped bring advertisers back. This acquisition illustrates Musk’s strategy to merge social media with AI technology.
