Confirmed! SpaceX announces acquisition of AI company xAI; post-merger valuation of $1.25 trillion

According to CCTV News, on February 2nd local time, American entrepreneur Elon Musk’s space exploration company SpaceX issued a statement announcing the acquisition of xAI, an artificial intelligence company also owned by Musk. xAI also issued a statement confirming it has “joined SpaceX.”

According to Cailian Press, the memorandum shows that the merged company of SpaceX and xAI is expected to be priced at approximately $527 per share, with a valuation of $1.25 trillion. Among them, SpaceX is valued at $1 trillion, xAI at $250 billion, and the merger will be in all-stock form.

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Previous Reports

On January 30th, media reports indicated that Elon Musk is planning an unprecedented business restructuring to build a “planetary-scale” tech empire.

According to insiders, SpaceX has discussed the possibility of merging with Tesla, and some investors are pushing for this idea to be implemented. Additionally, SpaceX is exploring the feasibility of merging with xAI before its initial public offering (IPO). No final decision has been made yet, and details may still change; each company may also choose to operate independently.

It is reported that SpaceX is considering going public in June (around Musk’s birthday), with a fundraising amount potentially reaching $50 billion, which could become the largest IPO in history. The company’s valuation could reach $1.5 trillion, close to Tesla’s $1.6 trillion.

If Tesla merges with xAI, the new entity’s valuation could surpass $2 trillion, making it the world’s most valuable tech company.

After the news broke, Tesla’s stock price quickly surged in after-hours trading, with an increase of up to 4.5%.

How do SpaceX, Tesla, and xAI “complement” each other? In Musk’s long-term plans for SpaceX, different business segments have potential synergistic effects. He has even envisioned sending data centers into space to provide complex computing power for artificial intelligence.

According to publicly available information, by the end of 2025, Starlink has deployed over 15,000 satellites (including 7,500 approved and pending deployment), accounting for more than 60% of active satellites in low Earth orbit worldwide. It provides low-latency internet services to 3.2 billion people across 155 countries and regions, with user numbers exceeding 9.2 million. The latest reports indicate that SpaceX’s revenue last year was approximately $15-16 billion, with a profit of about $8 billion. Starlink accounts for 50% to 80% of SpaceX’s total revenue. This infrastructure can provide real-time data transmission capabilities for Tesla’s autonomous vehicle fleet and also serve as a “data gold mine” for training AGI models for xAI.

Tesla’s energy and autonomous driving technologies are key pieces of SpaceX’s puzzle. Tesla’s energy business can be combined with SpaceX’s Starlink base stations, and its FSD system can leverage SpaceX to provide “satellite internet + microgrid” integrated solutions for remote areas.

xAI’s AGI development capabilities could serve as the “space brain” for the merger. The Grok 4 and Grok 4 Heavy models launched in 2025 already possess long-context understanding and advanced reasoning capabilities. In SpaceX’s Mars missions, AGI systems need to process satellite images, weather data, and astronaut commands simultaneously, making autonomous decisions under extreme latency conditions.

However, this merger also faces significant challenges, primarily involving Tesla. As a publicly listed company with a market value of about $1.4 trillion, any acquisition involving Tesla must go through extremely complex procedures. In contrast, SpaceX and xAI are both private companies, and their merger decision processes can be faster and less transparent, mainly decided by Musk and his core board of directors.

(Source: Daily Economic News)