SpaceX Acquires xAI, Merging Elon Musk’s AI and Space Ambitions Into One Company

Elon Musk has merged two of his most ambitious companies after SpaceX announced it has acquired xAI, creating what Musk called “the next book” in their shared mission and forming the world’s most valuable private company.

SpaceX was valued at roughly $800 billion following a secondary share sale late last year, while xAI carried an estimated valuation of $230 billion from its most recent funding round, according to PitchBook.

The move highlights both xAI’s growing need for capital in the fast-moving AI race and Musk’s vision of tying artificial intelligence directly to future space exploration. Musk said current AI advances depend heavily on massive data centers that require enormous power and cooling — a challenge he believes could eventually be solved by moving computing infrastructure into space.

SpaceX recently sought approval from the Federal Communications Commission to launch up to one million satellites, aiming to create solar-powered orbital data centers to meet exploding AI demand. Musk estimates that within two to three years, space could become the lowest-cost location to generate AI computing power.

The announcement comes as tech companies worldwide scramble to secure computing resources. Industry leaders warn next-generation AI models will require dramatically more energy, with analysts projecting data center power demand could surge by more than 160 percent by 2030. Major firms like Microsoft and Meta have already poured tens of billions into AI infrastructure.

xAI has also faced scrutiny over its chatbot Grok on Musk’s social platform X, following criticism tied to inappropriate and harmful content. Despite concerns, investors continue to back AI aggressively. xAI raised $20 billion in January from groups including Fidelity Management & Research Company and the Qatar Investment Authority.

There has long been crossover between SpaceX and xAI, with some employees holding roles at both companies. Still, former staffers have publicly questioned whether the two organizations’ cultures will align.

Musk has also confirmed plans for a future SpaceX initial public offering, a move that could become one of the largest IPOs in history. A combined SpaceX–xAI public debut could significantly expand Musk’s already massive fortune.

Musk, currently valued at about $676 billion by Bloomberg’s real-time tracker, is already the world’s richest person — and this merger could push that figure even higher.

Credit: CNN Newsource

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