Elon Musk Announces Historic Merger of SpaceX and xAI Valued at $1.25 Trillion

In a significant move reflecting Elon Musk's ambitions in artificial intelligence and space exploration, the world's richest man has announced the merger of his companies, SpaceX and xAI, forming a new entity valued at $1.25 trillion.

According to sources cited by Bloomberg, SpaceX is valued at $1 trillion, while xAI is estimated at $250 billion.

The all-stock deal will unite the two largest private companies globally and is expected to pave the way for an initial public offering (IPO) of the merged entity later this year, with an anticipated share price of $526.59.

Musk stated that the merger aims to create "the most ambitious and vertically integrated engine of innovation on Earth and in space," encompassing artificial intelligence, rockets, satellite internet, and direct communications with mobile devices, while providing "the most significant global platform for real-time information and freedom of expression."

He further emphasized that the most cost-effective means for conducting massive AI computations in the next two to three years will be found in space, which will accelerate the development of models and data processing at unprecedented speeds and scales, contributing to scientific and technological breakthroughs beneficial to humanity.

The merged company plans to launch up to one million satellites into low Earth orbit as part of its ambitious Starlink network development and to expand funding sources for xAI's capital-intensive activities.

It is noteworthy that Musk previously acquired Twitter, rebranded it as X, and merged it with xAI in a deal valued at $33 billion, reflecting his strategy of integrating capital, skills, and technologies across his various ventures.

Unlike some of his other initiatives, SpaceX stands out as one of Musk's most successful and significant enterprises, being the only American provider capable of regularly sending astronauts to the International Space Station and generating increasing revenues through its satellite network, making it a vital funding source for future AI endeavors.