March 29, 2025: Elon Musk announced that his artificial intelligence startup, xAI, has acquired his social networking platform, X, in a deal that values the company at $33 billion. The merger, confirmed on Friday, merges xAI’s cutting-edge AI capabilities with X’s vast user base of over 600 million.
This strategic partnership, Musk stated, will unlock immense potential, blending the two companies’ strengths to create a platform that “actively accelerates human progress.”
The all-stock transaction values xAI at $80 billion, while X’s valuation factors in a $12 billion debt, reflecting the company’s unique market position. Musk, who acquired Twitter for $44 billion in 2022, now turns his attention to merging his AI ambitions with the social media giant. With this acquisition, Musk envisions combining the data, models, computing power, distribution, and talent from both companies to build an enhanced platform that is set to transform the digital landscape.
Musk’s xAI, launched two years ago, has made significant strides in AI development. In February, it released Grok 3, a next-generation chatbot that Musk describes as “scary smart.” With ten times the computational power of its predecessor, Grok 3 is positioned to compete with rivals like OpenAI’s ChatGPT and China’s DeepSeek. Musk, once a co-founder of OpenAI, now faces off with his former collaborator-turned-rival, Sam Altman, in a competitive AI sector that is rapidly evolving.
The acquisition also comes as X’s advertising revenue is expected to rise, despite challenges facing the platform. Analysts from Emarketer predict that brands will continue to spend on X as a form of “business insurance” against any potential retaliation from Musk, who is also known for his politically connected financial backing of former U.S. President Donald Trump.
This deal marks a significant shift in Musk’s vision for the future of both AI and social media. As the billionaire continues to reshape the tech landscape, the integration of xAI’s artificial intelligence with X’s social networking platform could redefine how users interact with digital content in the years to come.
Key Highlights of xAI , Twitter Deal
- xAI Acquires X: $33 billion deal combines Musk’s AI ambitions with social media platform.
- xAI Valuation: $80 billion, including X’s $12 billion debt.
- Grok 3: xAI’s new AI chatbot aims to challenge OpenAI’s ChatGPT.
- Advertising Revenue Forecast: X’s ad revenue set to rise amidst political pressure.
