Elon Musks xAI Acquires Social Media Platform X in $80 Billion Deal

Elon Musk’s artificial intelligence startup, xAI, has acquired his social media platform X, previously known as Twitter, in a stock deal announced in a post on Friday.

«xAI has purchased X through a complete stock acquisition,» Musk stated. «The merger is valued at $80 billion, with X valued at $33 billion ($45 billion less $12 billion in debt).»

Musk went on to describe the future of both companies as «intertwined,» adding, «Today, we are officially taking steps to integrate data, models, computing, distribution, and talent.»

This acquisition places X—a highly influential social media platform that Musk acquired in 2022 under its former name Twitter—under the umbrella of Musk’s AI startup, founded in 2023 to compete with OpenAI. While xAI’s products, including its AI chatbot Grok, were already closely integrated with the X platform prior to this acquisition, Friday’s deal further consolidates two of Musk’s most recognized companies.

Musk, who also leads Tesla, SpaceX, and Neuralink, noted in his post that this deal values X at $33 billion, down from its corporate valuation of $45 billion due to the company’s $12 billion debt. Musk initially purchased X for $44 billion in October 2022 and took it private. However, its valuation has fluctuated significantly since then. At one point, Fidelity valued X at less than $10 billion.

In the months following Donald Trump’s inauguration—against whom Musk ran an aggressive campaign and for whom he now serves as a special advisor on DOGE—X’s valuation increased, largely due to investors perceiving the platform as more influential. In his Friday post, Musk mentioned that X has over 600 million active users.

Musk launched xAI in 2023 and has since fortified the startup with leading AI researchers from Google DeepMind, Microsoft, and OpenAI and built massive AI data centers necessary to catch up with other advanced AI developers. To support these initiatives, Musk initiated a historic fundraising campaign, which included a $6 billion funding round in December that valued the startup at $45 billion. According to Musk, xAI’s valuation has now surpassed that—estimated at $80 billion.

xAI has made substantial strides in its ambitious quest to catch up with OpenAI, Google DeepMind, and Anthropic. In February, the startup released Grok 3, an advanced AI model that competes with leading industry models in mathematics, science, and coding.

However, xAI’s achievements haven’t deterred Musk from intervening in OpenAI, the startup he co-founded with Sam Altman. Musk is currently trying to challenge OpenAI’s transition to a commercial model, a necessary step for securing future funding, in several ways. The billionaire owner of xAI has made OpenAI’s commercial transition a focal point of his lawsuit against the organization. He also filed an acquisition proposal for Altman’s startup for $97 billion in February. The OpenAI board promptly rejected this idea, but it has already potentially raised the market value of OpenAI’s assets.

One of xAI’s main advantages over OpenAI and other startups is its access to X. The vast array of posts accumulated by X over the years provides xAI with a significant edge in the data race for training AI. Additionally, X offers Musk’s AI startup a substantial consumer application to reach users.

Musk has a history of blurring the lines between his numerous ventures, which has already led to legal issues. With xAI’s acquisition of X, these two entities effectively become one—a move that suggests the true value of X may lie in advancing Musk’s broader ambitions in artificial intelligence.

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