SpaceX has acquired artificial intelligence company xAI, according to an official statement published on SpaceX’s website and signed by Elon Musk. The company said the acquisition brings artificial intelligence development together with launch systems, satellite networks, space-based internet, and direct-to-device communications under a single corporate structure.
In the statement, SpaceX said the integration is intended to support large-scale AI computing by combining xAI’s models and research with SpaceX’s space infrastructure. Musk said current AI development relies heavily on terrestrial data centers, which face increasing constraints related to power availability and cooling requirements.
SpaceX said these limitations make it difficult to meet growing global demand for AI computing using ground-based infrastructure alone.
SpaceX outlines space-based computing approach
In the official release, Musk said large-scale AI computing could become more cost-effective in space within the next two to three years. He said space-based systems powered by near-continuous solar energy could reduce operating constraints associated with land-based data centers.
SpaceX said it is seeking permission to deploy up to one million satellites as part of a long-term plan to support space-based computing. The company said this approach is intended to enable scalable AI model training and large-scale data processing alongside its existing space and connectivity initiatives.
Deal values combined entity at $1.25 trillion
Bloomberg reported that the all-stock transaction values the combined SpaceX–xAI entity at $1.25 trillion, citing people familiar with the matter. According to the report, SpaceX is valued at $1 trillion and xAI at $250 billion, with the valuation communicated to employees in an internal memo on Monday. The acquisition confirmed an earlier report, while SpaceX did not disclose pricing or valuation details in its public statement.
Key details reported by the publication include:
- All-stock transaction; combined share value estimated at $526.59
- SpaceX still planning an initial public offering later this year
- Prior SpaceX share sale considered at up to $50 billion
- xAI raised funding in January at a valuation of around $230 billion
- xAI spending approximately $1 billion per month
- SpaceX filed for regulatory approval to launch up to one million satellites
- Starlink operates more than 9,000 satellites and now generates more revenue than launches
Bloomberg said the merger further consolidates Elon Musk’s businesses, following his acquisition of Twitter in late 2022 and its subsequent merger with xAI in a $33 billion deal, and added that SpaceX remains Musk’s most established company and a key launch provider for NASA and the US Department of Defense, while revenue from the Starlink satellite network could help support xAI’s capital-intensive operations.
Outlook
The acquisition places artificial intelligence development and space infrastructure within a single corporate framework. Future developments are expected to depend on regulatory approvals, satellite deployment timelines, and progress toward SpaceX’s proposed public listing.