Elon Musk’s artificial intelligence venture, xAI, has officially taken control of the social media platform X—formerly Twitter—in a $33 billion all-stock transaction. The acquisition, unveiled on Friday, marks another significant step in Musk’s efforts to integrate his growing portfolio of companies.
The move consolidates Musk’s influence across multiple industries, bringing together his AI firm with X and potentially facilitating the training of Grok, xAI’s advanced chatbot model. Other ventures under Musk’s leadership include Tesla and SpaceX, both of which play crucial roles in his expanding technological empire.
In a post on X, Musk detailed the financial structure of the merger, emphasizing that the deal assigns an $80 billion valuation to xAI while confirming X’s worth at $33 billion. He highlighted the deepening connection between the two entities, stating that the combination would integrate data, talent, computing power, and distribution.
Beyond his business sphere, Musk has extended his reach into US politics, playing a role in cost-cutting initiatives within the Trump administration. His influence in Washington has led to speculation about potential advantages for his companies in regulatory matters.
One investor in xAI, who also holds a stake in the newly merged entity, told the Reuters news agency that Musk’s decision aligned with his broader strategy of consolidating power across his enterprises. The investor added that Musk did not seek shareholder approval for the merger but assured them that xAI and X were already closely collaborating.
Founded less than two years ago, xAI has rapidly gained traction in the AI sector, recently securing $10 billion in funding at a $75 billion valuation. The company’s aggressive expansion follows Musk’s unsuccessful bid to acquire OpenAI for $97.4 billion earlier this year. OpenAI, which Musk co-founded in 2015 alongside Sam Altman, firmly rejected the offer.
As part of its strategy to compete with AI giants like OpenAI and China’s DeepSeek, xAI recently launched Grok-3, an advanced chatbot model. The acquisition of X provides a new distribution channel for xAI’s technologies while leveraging real-time user-generated content to refine AI training.
The broader AI industry has witnessed a surge in investment, prompting tech firms to scale up their infrastructure. xAI has been intensifying efforts to enhance its computational capacity, with its Memphis-based supercomputer cluster, Colossus, positioned as one of the most powerful in existence.
Musk’s ownership of X dates back to 2022, when he privatized the platform for $44 billion. Following the takeover, he significantly reduced its workforce, a move that triggered an advertiser exodus and revenue downturn. However, recent months have seen brands gradually returning, coinciding with Musk’s rising political influence.