Musk’s xAI Buys His Social Media Platform X for $33 Billion
Last updated: April 15, 2025
Elon Musk’s AI startup, xAI, has acquired his social media platform, X, in an all-stock deal.
“xAI and X’s futures are intertwined,” Musk said in a post on X. “Today, we officially take the step to combine the data, models, compute, distribution, and talent.”
While the deal’s details remain unclear, Musk values “xAI at $80 billion and X at $33 billion ($45B less $12B debt)” in the combination. For reference, Musk paid $44bn for X (then Twitter) in 2022.
The valuation of X is significantly higher than the mutual fund brokerage firm Fidelity’s estimates from last year, which pegged X at around $12.5 billion. The platform’s plummeting value has been largely attributed to brands halting advertising in response to Musk’s stance as a free-speech “absolutist” and the controversies that followed.
xAI and X had close ties before the merger. They share major investors and resources. One anonymous investor in xAI told Reuters the consolidation didn’t come as a surprise. According to the source, Musk didn’t ask for investors’ approval but highlighted the collaboration between the two companies and plans for deeper integration with xAI’s chatbot Grok.
Grok is trained on posts from X, along with other publicly available data. Initially, it was exclusively available to premium X users and later to everyone on the platform. Recently, the “humorous AI assistant” launched as a standalone app. The acquisition will give xAI direct access to large-scale real-world data for advanced AI training.
xAI, which Musk founded in 2023, focuses on developing AI solutions that compete with industry leaders such as OpenAI, Google, and Anthropic. In line with the billionaire’s free speech advocacy, the AI startup prides itself on creating AI models with fewer restrictions than its competitors.
The move aligns with Musk’s broader vision of transforming X into an all-encompassing “everything app.” In the past, Musk has revealed plans to supercharge X with capabilities like making payments, booking rides, and controlling smart home devices. With an AI boost from xAI’s proprietary AI models, X could expand beyond a traditional social media platform.
