As Elon Musk continues his relentless pursuit of AI dominance, the tech billionaire has revealed his boldest move yet: a $113 billion all-stock merger between his AI company xAI and social media platform X. The deal values xAI at a whopping $80 billion, while X comes in at $33 billion after subtracting its $12 billion debt. Talk about a power play.
The merger aims to integrate everything from data and models to compute and talent. It’s Musk’s grand vision to create a tech powerhouse. But let’s be real—X’s valuation has plummeted since Musk’s $44 billion Twitter purchase in 2022. Fidelity recently pegged its worth at just $9.4 billion. Ouch.
Meanwhile, xAI has been on fire. Its value jumped from $50 billion in late 2024 to $80 billion in this deal. The company’s Grok-3 chatbot, launched in February 2025, is giving OpenAI a run for its money. And that “Colossus” supercomputer in Memphis? Biggest in the world, apparently.
xAI’s meteoric rise shows Musk isn’t just playing the AI game—he’s rewriting the rulebook entirely.
The strategic logic makes sense. X’s 600 million users provide a massive data playground for xAI’s models. The merger will specifically boost Grok’s capabilities by leveraging real-time data from the X platform. Plus, after early advertising woes following Musk’s Twitter takeover, brands are crawling back as Musk’s influence grows. Perfect timing.
Musk isn’t alone in this venture. Saudi Prince Alwaleed bin Talal, Sequoia Capital, and Fidelity all have skin in the game. And with U.S. President Donald Trump, a close Musk ally, in the White House, regulatory hurdles might not be as intimidating as they could’ve been.
This merger comes just after Musk’s failed $97.4 billion bid for OpenAI. Rejected? No problem. He’ll just build his own AI empire instead. Musk has emphasized that the acquisition will accelerate their mission of seeking truth and advancing human progress.
The legal team, led by Mike Ringler and Peter Jones, has their work cut out for them. There’s still that pesky Twitter investment disclosure lawsuit Musk couldn’t shake. But when has a little legal trouble ever stopped Elon from shooting for the stars?
