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Elon Musk says xAI acquired X

By Advanced AI EditorMarch 29, 2025No Comments4 Mins Read
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Elon Musk’s AI startup, xAI, has acquired his social media platform X, formerly known as Twitter, in an all-stock deal, he announced in a post on X Friday.

“xAI has acquired X in an all-stock transaction,” Musk said. “The combination values xAI at $80 billion and X at $33 billion ($45B less $12B debt).”

Musk went on to describe the two companies’ futures as “intertwined.” He added, “Today, we officially take the step to combine the data, models, compute, distribution and talent.”

The acquisition places X — the highly influential social media platform Musk purchased in 2022 under its former name, Twitter — firmly under the umbrella of Musk’s AI startup, which he founded in 2023 to compete with OpenAI. While xAI’s products, including its AI chatbot Grok, were tightly integrated into the X platform before this deal, Friday’s acquisition further combines two of Musk’s most high-profile companies.

According to publications including The Wall Street Journal, shares of X and xAI will be exchanged for shares of a new holding company called xAI Holdings Corp. The WSJ also reports that executives at both companies believed that it would be easier to raise money for a combined entity.

Musk — who also leads Tesla, SpaceX, and Neuralink — notes in his post that this deal values X at $33 billion (lowered from an enterprise value of $45 billion due to the company’s $12 billion in debt). Musk originally purchased X for $44 billion in October 2022 and took it private. However, the valuation has swung dramatically in recent years. At one point, Fidelity valued X at less than $10 billion.

In the months since the inauguration of President Donald Trump — for whom Musk aggressively campaigned and for whom Musk now serves under as a special adviser leading DOGE — X’s valuation has risen, largely because investors believe the platform more influential now. Musk said in his post on Friday that X has more than 600 million active users.

Musk launched xAI in 2023 and has since beefed up the startup with industry-leading AI researchers from Google DeepMind, Microsoft, and OpenAI, and built out the massive AI data centers needed to catch up with other frontier AI developers. To fuel these efforts, Musk has gone on a historic fundraising campaign, including a $6 billion funding round in December that valued the startup at $45 billion. According to Musk, xAI’s valuation is now even higher, at $80 billion.

xAI has largely been successful in its mad dash to catch up with OpenAI, Google DeepMind, and Anthropic. In February, the startup released Grok 3, a frontier AI model that’s competitive with the industry’s leading AI models on benchmarks measuring math, science, and coding.

But xAI’s successes have not stopped Musk from meddling with OpenAI, a startup he co-founded with Sam Altman. Musk is currently trying to thwart OpenAI’s for-profit transition — which it needs to complete to secure future funding — in more ways than one. The billionaire owner of xAI has made OpenAI’s for-profit transition the centerpiece of his lawsuit against OpenAI. Musk also submitted a $97 billion takeover bid for Altman’s startup in February. OpenAI’s board promptly rejected the idea, but it already may have driven up the market price for OpenAI’s assets.

One of the major advantages that xAI has over OpenAI and other startups is its access to X. The large body of posts that X has accumulated over the years gives xAI a significant advantage in the race for AI training data. Further, X gives Musk’s AI startup a huge consumer app to reach users in.

Musk has a history of blurring the lines between his many companies, which has landed him in legal trouble before. With xAI’s acquisition of X, the two are now effectively one — and the move suggests that X’s true value may lie in advancing Musk’s broader AI ambitions.

This story has been updated with additional details about the structure of the deal.



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