Elon Musk’s Spacex Officially Acquires Elon Musk’s Xai, With Plan To Build Data Centers In Space

SpaceX has acquired Elon Musk’s artificial intelligence startup, xAI, creating nan world’s astir valuable backstage company, nan spaceflight institution announced Monday.

Musk, who is besides nan CEO of SpaceX, wrote successful a memo posted to nan rocket company’s website that nan merger is mostly astir creating space-based information centers — an thought he has go fixated connected complete nan past fewer months.

“Current advances successful AI are limited connected ample terrestrial information centers, which require immense amounts of powerfulness and cooling. Global energy request for AI simply cannot beryllium met pinch terrestrial solutions, moreover successful nan adjacent term, without imposing hardship connected communities and nan environment,” he wrote. (xAI has been accused of imposing immoderate of that hardship connected nan communities adjacent its information centers successful Memphis, Tennessee.)

The tie-up values nan mixed institution astatine $1.25 trillion, according to Bloomberg News, which was first to report nan completed deal. SpaceX has been reportedly preparing an IPO for arsenic early arsenic June of this year. It’s unclear whether nan merger will impact that timeline. Musk did not reside nan IPO successful his nationalist memo.

The merger brings together 2 of Musk’s companies, each pinch its ain financial challenges. xAI is presently burning around $1 cardinal per month, according to Bloomberg. SpaceX, meanwhile, generates arsenic overmuch arsenic 80% of its gross from launching its ain Starlink satellites, according to Reuters. Last year, xAI acquired X, nan societal media institution besides owned by Musk, pinch Musk claiming a mixed institution valuation of $113 billion.

Musk wrote successful his memo that it will return a changeless watercourse of galore — though he did not specify really galore — satellites to create these space-based information centers, ensuring that SpaceX will person an even-larger changeless watercourse of gross for nan foreseeable future. (That gross loop apt looks moreover much charismatic erstwhile you see that satellites are required to beryllium de-orbited each 5 years by nan Federal Communications Commission.)

While abstraction information centers whitethorn beryllium nan stated goal, SpaceX and xAI person very different near-term objectives.

SpaceX is presently trying to beryllium that its Starship rocket is tin of bringing astronauts to nan satellite and Mars, while xAI is competing pinch starring artificial intelligence companies for illustration Google and OpenAI. The unit connected xAI is truthful great, nan Washington Post reported Monday, that Musk loosened restrictions connected nan company’s chatbot Grok — which contributed to it becoming a instrumentality for making AI-generated non-consensual intersexual imagery of adults and children.

Musk is also nan head of Tesla, The Boring Company, and Neuralink. Tesla and SpaceX previously invested $2 cardinal each successful xAI.