On March 29, 2025, Elon Musk announced the sale of his social media company X to xAI, his artificial intelligence start-up. This all-stock deal values xAI at $80 billion and X at $33 billion, reflecting a significant decline from the $44 billion Musk paid for X in 2022.
- Elon Musk sold X to xAI.
- xAI valued at $80 billion; X at $33 billion.
- X's valuation decreased from $44 billion.
- Companies share resources like engineers and data.
- Musk combines companies for financial strategy.
- Most Musk companies are privately held.
The sale of X to xAI illustrates Musk’s strategy of integrating different parts of his business empire. Musk indicated that the two companies have been collaborating closely, sharing engineers and resources. The chatbot Grok, developed by xAI, utilizes data from X users and is accessible on the platform. Recently, X’s revenue has been partially attributed to its relationship with xAI.
Key details of the deal include:
- X’s valuation dropped from $44 billion to $33 billion.
- xAI’s valuation increased from $40 billion during its last funding round.
- Both companies are privately held, allowing for less financial transparency.
Musk’s approach to business often defies traditional norms, as he moves resources and personnel between his various companies, including Tesla and SpaceX. This sale reflects his ability to leverage the strengths of one company to support another, as seen previously in his acquisition of SolarCity using Tesla stock.
This transaction marks a pivotal moment in Musk’s business strategy, merging a declining asset with a growing one. As both companies continue to evolve, their combined efforts aim to enhance user experiences while maintaining their core mission of advancing knowledge.
