Elon Musk Merges xAI with X in $33 Billion Deal

San Francisco: Elon Musk announced on Friday that his artificial intelligence company, xAI, will acquire his social media platform X—formerly known as Twitter—in a merger valuing X at $33 billion. Musk said the move would “unlock immense potential” by combining xAI’s advanced AI tools with the large-scale reach of X, which currently boasts over 600 million users.

Admin Mar 29, 2025 12 0

San Francisco: Elon Musk announced on Friday that his artificial intelligence company, xAI, will acquire his social media platform X—formerly known as Twitter—in a merger valuing X at $33 billion. Musk said the move would “unlock immense potential” by combining xAI’s advanced AI tools with the large-scale reach of X, which currently boasts over 600 million users.

According to Musk, the integration marks a pivotal moment as the two companies will share resources across data, models, computing power, user distribution, and talent. “This merger creates a foundation for a platform that not only mirrors the world but also propels humanity forward,” he stated.

The merger is structured as an all-stock deal, assigning xAI a value of $80 billion while including X’s $12 billion in debt. Musk originally acquired Twitter in late 2022 for $44 billion, a purchase that included significant borrowed capital. He launched xAI in 2023 and has invested heavily in cutting-edge Nvidia chips to power its AI capabilities.

In February, xAI unveiled Grok 3, its latest chatbot iteration, which Musk has described as “scary smart,” claiming it has ten times the computing power of its predecessor from August. Grok 3 now competes directly with other industry leaders, including OpenAI’s ChatGPT and China’s DeepSeek.

The rivalry between Musk and OpenAI’s CEO, Sam Altman, continues to intensify. Once collaborators—both co-founded OpenAI in 2015—Musk left the company in 2018. OpenAI’s 2022 launch of ChatGPT rapidly boosted Altman’s prominence in the tech world, and tensions between the two have since become both public and legal.

Aside from his AI and social media ventures, Musk also remains a strong political figure. As a key supporter of former U.S. President Donald Trump and head of the Department of Government Efficiency, Musk has led major staff cuts across federal agencies.

Market analysts from Emarketer predict X’s ad revenue will rise this year, partly due to Musk’s political influence. “Some brands may feel compelled to advertise on X to avoid potential legal or business risks,” noted Jasmine Enberg, principal analyst at Emarketer.