SpaceX acquires xAI: Musk merges space and AI into $1.25 trillion private giant

In the background of the story is an attempt to collect resources for increasingly expensive races in artificial intelligence. xAI is behind the Grok chatbot and major investments in computing infrastructure, while SpaceX is Musk’s biggest private asset with revenue from launches and Starlink. The idea of ​​the merger, as Musk described it, is to accelerate the building of AI capacity and connect it to space systems, from satellite Internet to future projects related to data centers and energy.

Those who follow a little more have noticed that most of Musk’s projects have seen huge declines recently. Tesla is in the worst position in the last few years, and money is allegedly mostly spent on Grok, without enough of it being returned. In principle, the only thing that still works for Musk is Starlink, so this move can be interpreted as using one company to save another.

In a separate news story, Reuters adds that the announcement spurred the growth of shares of several American “space” companies as the market sees it as a signal that AI investments will also push demand in the broader space sector. In addition to all that, it is also mentioned that SpaceX is moreć has long been a candidate for a major IPO, so investors will especially look at how such a merger fits into plans for financing and management.

It is important to distinguish two things here: the valuations mentioned refer to the private market and estimates from sources close to the agreements, and not to the share price on the stock exchange. In the coming days, the key questions will be the structure of the transaction, the ratio of shares between the investments of SpaceX and xAI, and how quickly the “merger on paper” will bring real changes in products and infrastructure.