Elon Musk Merges SpaceX with xAI, Creates $1.25 Trillion "Innovation Engine"

Musk's note about the deal to acquire xAI was posted by the rocketmaker and shared on his social media platform X.

Musk's xAI owns and operates his social network X after he merged those two entities last year.

According to a Bloomberg report the combined company of SpaceX and xAI has a valuation of USD1.25 trillion, and SpaceX plans to Initial Public Offering (IPO) later this year.

A CNBC report said that the merger deal between SpaceX and xAI was completed on Monday.

Musk had expanded xAI by merging it with his social network X, which used to be known by the name Twitter. Incidentally, xAI's main product Grok is under investigation in the EU over its AI image generation feature, with concerns that it was used to create sexualised images. xAI has stated that it has imposed restrictions on Grok users that limit image editing.

Meanwhile, in his note on the SpaceX and XAI merger, Musk said the combination would form an "innovation engine" putting AI, rockets, space-based internet, and media under one roof.

This marks not just the next chapter, but the next book in SpaceX and xAI's mission: scaling to make a sentient sun to understand the Universe and extend the light of consciousness to the stars!" Musk said.

According to the SpaceX press release, the merger will eventually allow placing AI data centres in space, powered by solar energy.

Muske said, "My estimate is that within 2 to 3 years, the lowest cost way to generate AI compute will be in space. This cost-efficiency alone will enable innovative companies to forge ahead in training their AI models and processing data at unprecedented speeds and scales, accelerating breakthroughs in our understanding of physics and invention of technologies to benefit humanity."

"This new constellation will build upon the well-established space sustainability design and operational strategies, including end-of-life disposal, that have proven successful for SpaceX's existing broadband satellite systems."

The merger follows after SpaceX last week filed an official request with the US Federal Communications Commission (FCC) to deploy and operate a constellation of up to one million satellites designed as orbital data centres with unprecedented computing power for advanced AI models and applications.

- ANI