Elon Musk’s artificial intelligence xAI has purchased social media platform X, formerly Twitter, consolidating Musk’s management of the companies and combining their data and computing resources.
Musk said in a statement on X that the all-stock transaction values xAI at $80 billion (£62bn) and X at $33bn, which he said equated to $45bn less $12bn debt.
Industry-watchers noted that the $45bn figure is $1bn more than the $44bn Musk and his backers paid for Twitter in 2022, allowing investors in X to share in the value of xAI.
Market value
Analysts had previously estimated that the value of Twitter had decreased sharply since the take-private deal, after Musk slashed staff, reduced moderation to a minimum and advertisers fled.
Musk founded xAI in March 2023 amidst a wave of investor interest in AI that began after OpenAI publicly launched ChatGPT in November 2022.
Musk was also a co-founder of OpenAI, but cut off his association with the company and is suing it over its efforts to shift form a non-profit to a for-profit model.
xAI recently raised $10bn in a funding round that valued the company at $75bn, according to media reports.
Musk said the deal would see X and xAI combine their data, models, computing resources, distribution and staff, without providing details.
xAI’s chatbot, Grok, is trained using X users’ social media posts and is a prominent offering on X.
AI infrastructure
The start-up, like other companies with exposure to AI, has been investing in its computing resources by expanding its supercomputer cluster in Memphis, Tennessee, called Colossus.
Earlier this month xAI and Nvidia joined the AI Infrastructure Partnership (AIP), providing capital for the project along with initial backers BlackRock, Microsoft and United Arab Emirate state-owned investment firm MGX.
The group said it was looking to work with Nvidia and xAI to build and scale an open-architecture data centre platform supporting a diverse range of partners on a non-exclusive basis.
xAI introduced its latest Grok-3 chatbot in February as it competes with OpenAI, Chinese start-up DeepSeek and others.