Elon Musk Announces xAI’s Game-Changing Acquisition of X: What It Means for the Tech World | TechCrunch

Elon Musk‘s AI startup, xAI, has just acquired the social media platform X, previously known as Twitter. Musk shared the news in a recent post, announcing this all-stock deal. This merger values xAI at $80 billion, with X itself valued at $33 billion after factoring in $12 billion of debt.

Musk believes the futures of both companies are deeply linked. He mentioned the move allows them to combine data, technology, and talent to enhance their offerings. This acquisition firmly places X under the umbrella of xAI, a company Musk launched in 2023 to rival other AI leaders like OpenAI.

Interestingly, X’s valuation has seen quite a rollercoaster since Musk bought it for $44 billion in October 2022. At one low point, a valuation from Fidelity dropped it to under $10 billion. However, it’s since rebounded, partly due to a belief among investors that X’s influence is growing. As noted by Musk, X currently boasts over 600 million active users.

In building xAI, Musk has recruited top AI talent from giants like Google and Microsoft. With significant fundraising efforts, including a notable $6 billion round last December, xAI is rapidly advancing. The startup’s AI model, Grok 3, has made strides in competitiveness on various tech benchmarks.

xAI diverges from OpenAI, a company Musk co-founded and has since criticized for becoming for-profit. This conflict has led to Musk pursuing legal action and even making a staggering $97 billion takeover bid for OpenAI, which was rejected. These moves hint at an intense rivalry in the AI space.

Musk’s access to social media data from X gives xAI an edge in training AI systems. The merger not only unites two major ventures of Musk but also raises questions about the overarching value of X in advancing xAI’s ambitious goals.

In today’s world, companies like xAI are at the forefront of AI technology. A recent survey from the Pew Research Center indicates that nearly 70% of Americans have experienced some engagement with AI tools in their daily lives, underscoring the importance of competitive players in this field. As Musk continues to shape the landscape of technology, this merger could have far-reaching implications for users and developers alike.

For more information, you can check out reputable sources like The Wall Street Journal that cover Musk’s ongoing endeavors and the evolution of these powerful companies.

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