SpaceX on Monday acquired xAI, the artificial intelligence startup that also owns the X social media platform, in a deal combining two companies owned by Elon Musk.<\/p>\n
Musk in a news release said that the combination would aim to pursue AI data centers in outer space.<\/p>\n
The deal comes on the verge of SpaceX’s highly anticipated initial public offering, which is expected to occur later this year.<\/p>\n
The deal creates “the most ambitious, vertically-integrated innovation engine on (and off) Earth, with AI, rockets, space-based internet, direct-to-mobile device communications and the world\u2019s foremost real-time information and free speech platform,” Musk said in a statement<\/a>.<\/p>\n The combined company will become the world\u2019s most valuable private company, worth more than $1.2 trillion, Bloomberg News reported<\/a>. NBC News has not been able to verify the valuation, and the companies did not respond to requests for comment.<\/p>\n Musk went on to say that space would be a crucial avenue for building advanced artificial intelligence. <\/p>\n “In the long term, space-based AI is obviously the only way to scale,” Musk wrote. “The only logical solution therefore is to transport these resource-intensive efforts to a location with vast power and space.”<\/p>\n Musk also offered an ambitious timeline for starting to develop AI from space. He’s failed to meet<\/a> many of the previous goals he set for his companies.<\/p>\n \u201cMy estimate is that within 2 to 3 years, the lowest cost way to generate AI compute will be in space,\u201d he wrote in Monday\u2019s news release.<\/p>\n SpaceX already conducts rocket tests using reusable parts, provides cellular phone and data services to T-Mobile customers, and is working with NASA to return humans to the moon in the near future.<\/p>\n Meanwhile, xAI, Musk’s bid to get in on the AI boom, has reportedly soared to a more than $200 billion valuation<\/a>. Along the way, the company and its AI bot, Grok, have drawn criticism. Recently, the company limited its image generation technology after users said it was creating sexualized deepfakes<\/a>. A number of state attorneys general and the European Union are investigating the company.<\/p>\n Musk’s companies have often been intertwined, but Monday’s deal brings them even closer together. Another one of Musk’s companies, Tesla, has invested in xAI and uses some of its technology. <\/p>\n Musk merged his social media site X with xAI in early 2025<\/a>, but the tie-up between xAI and SpaceX marks the largest combination to date of Musk’s vast business projects. <\/p>\n