Elon Musk’s AI startup, xAI, has taken over his social media platform X, previously known as Twitter, in an all-stock deal, he announced in a post on X Friday.
“xAI has taken control of X in an all-stock transaction,” Musk said. “The deal values xAI at $80 billion and X at $33 billion ($45 billion minus $12 billion in debt).”
Musk described the two companies’ futures as “deeply connected.” He added, “Today, we officially take the step to merge our data, AI models, computing power, distribution, and talent.”
This takeover puts X — the widely influential social media platform Musk bought in 2022 when it was still called Twitter — directly under xAI, the AI company he started in 2023 to compete with OpenAI. Although xAI’s products, such as its AI chatbot Grok, were already closely linked to X before the deal, Friday’s acquisition further merges two of Musk’s most high-profile companies.
Musk — who also runs Tesla, SpaceX, and Neuralink — noted in his post that this deal values X at $33 billion (lowered from $45 billion due to $12 billion in debt). Musk originally bought X for $44 billion in October 2022 and took it private. However, the company’s value has fluctuated significantly over the years. At one point, financial services firm Fidelity estimated X was worth less than $10 billion.
In the months since President Donald Trump took office — after Musk strongly supported his campaign and was later appointed as a special adviser in charge of DOGE — X’s value has increased, mainly because investors see the platform as more powerful 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 strengthened the company by hiring top AI researchers from Google DeepMind, Microsoft, and OpenAI. He also built massive AI data centers to compete with other leading AI companies. To fund these efforts, Musk raised $6 billion in December, which valued the company at $45 billion. According to Musk, xAI’s value has since climbed to $80 billion.
xAI has been mostly successful in its fast-paced effort to catch up with OpenAI, Google DeepMind, and Anthropic. In February, the company released Grok 3, an advanced AI model that performs as well as leading AI models on tests measuring skills in math, science, and coding.
Despite xAI’s success, Musk has continued to interfere with OpenAI, a company he co-founded with Sam Altman. Musk is trying to block OpenAI’s transition to a for-profit company — a step it needs to take to secure future funding. The billionaire owner of xAI has made OpenAI’s shift to a profit-driven model the central issue in his lawsuit against the company. Musk also made a $97 billion offer to buy OpenAI in February. OpenAI’s board quickly rejected the offer, but it may have already raised the market value of OpenAI’s assets.
One of xAI’s biggest advantages over OpenAI and other startups is its access to X. The enormous amount of posts collected on X over the years gives xAI a strong advantage in gathering training data for its AI. Additionally, X provides Musk’s AI startup with a large platform to connect directly with users.
Musk has a history of blending his many businesses, which has led to legal trouble in the past. With xAI’s takeover of X, the two companies are now essentially one — a move that suggests X’s real worth may be in advancing Musk’s larger AI goals.
