Elon Musk's xAI Reportedly Seeks $200 Billion Valuation Amid Funding Rumors and Denials

Musk's xAI Seeks $200 Billion Valuation in New Funding, FT Says

XAI Holdings, Elon Musk's artificial intelligence and social media company, is in the early stages of a funding round that could value the business at $200 billion, according to a report in the Financial Times. The company -- which combined X, formerly Twitter, with Musk's AI startup xAI -- would see its valuation climb, and cement its place as one of the world's most valuable private companies. A representative for xAI did not immediately respond to a request for comment. The Financial Times cited unnamed sources in its report.

Elon Musk's xAI seeks up to $200bn valuation in next fundraising

Elon Musk's xAI is preparing to raise more money from investors in a deal that could value the artificial intelligence company as high as $200bn -- 10 times its value early last year, according to people close to the talks. The fundraising, which is being discussed and could start formally next month, would be its third large share sale in less than two months. It raised $10bn through loans and cash investments in July, and in June sold $300mn of shares in a secondary stock offering. A deal would also cement a rapid rise in xAI's valuation from the $18bn set in its "series B" fundraising in May 2024. The company this week released the fourth model of its Grok chatbot, which posts on Musk's social media platform X -- days after the bot repeatedly praised Adolf Hitler and shared antisemitic rhetoric on the platform. The company pledged to ban hate speech from its posts. Three people close to the process said the new fundraising would target a valuation of between $170bn and $200bn. They cautioned the talks were preliminary and the details could change. Saudi Arabia's sovereign wealth fund, PIF, is expected to play a large role in the deal, two of the people said. PIF holds an indirect interest in xAI through its stake in Kingdom Holdings Company, which has invested $800mn in xAI. xAI did not respond to requests for comment. PIF declined to comment. xAI acquired X in March in an all-stock deal for $45bn. The transaction valued the combined company at $113bn. That would grow to about $245bn if the latest xAI fundraising is successful. Another Musk company, SpaceX, has surged in value recently. The rocket and satellite group is preparing to sell about $1bn of its shares in a deal that would value it at $400bn, the Financial Times reported this week. Musk's companies -- including Tesla and brain chip company Neuralink -- initially benefited from the entrepreneur's connections to US President Donald Trump following November's election. Musk was one of Trump's biggest backers, spending more than $250mn on his campaign, but a public spat last month has led to concern about blowback on some of his businesses. The value of his private companies suggests investors are looking past the risks of Trump targeting Musk's businesses. However, shares in Tesla have fallen nearly a fifth since the start of the year. xAI launched in 2023 shortly after OpenAI released its chatbot ChatGPT, which exploded in popularity. Musk was a co-founder of OpenAI in 2015 but he left in 2018, and has since been a vocal critic of the company and its chief executive Sam Altman. OpenAI was valued at $300bn as part of a fundraising earlier this year.

xAI reportedly raising new funding at up to $200B valuation - SiliconANGLE

Weeks after its last funding round, xAI Holdings Corp. is reportedly in talks to raise new capital at a valuation of $170 billion to $200 billion. The Financial Times today cited sources as saying that Saudi Arabia's PIF sovereign wealth fund is expected to play a "large role" in the investment. It's unclear who are the other investors in the round or how much xAI is seeking to raise. Earlier this month, the Elon Musk-backed artificial intelligence company raised a $5 billion funding round and the same amount in debt. It previously closed a $6 billion investment in November that valued it at $50 billion. That xAI's valuation is now reportedly poised to reach as much as $200 billion might be a sign of investor optimism about its technology. On Thursday, the company introduced a new flagship large language model called Grok 4. The algorithm set records across several artificial intelligence benchmarks known for their difficulty. In a blog post accompanying the launch, xAI engineers detailed that the company enhanced its compute infrastructure while building Grok 4. The AI developer claims that the efficiency of its training workflows has increased by a factor of six as a result. The upgrade may have boosted investor confidence in xAI's ability to compete with rivals such as OpenAI. According to the Financial Times, xAI plans to spend $18 billion on expanding its compute infrastructure. The company trains its models using a supercomputer called Colossus that is located in Memphis. Earlier this year, Musk stated that xAI plans to increase the number of graphics cards in the system from 200,000 to 1 million. The company sells access to its Grok LLM series via an application programming interface and consumer-focused subscriptions. Last month, Bloomberg reported that xAI expects those offerings to generate $500 million in revenue this year. The company estimates that its annual sales will jump to $19 billion by 2029. One way xAI plans to maintain its revenue growth is by launching new products. During the X live stream in which Grok 4 was announced this week, Musk said that the company is working on versions of the model optimized for video generation and coding tasks. The company will likely face tough competition in the coding automation market. Shortly after rumors of xAI's fundraising push emerged today, programming assistant developer Windsurf Inc. announced that its two co-founders and several engineers will join Google LLC. The Alphabet Inc. will also license technology from the company, which recently received a $3 billion takeover offer from OpenAI.

Musk's xAI seeks up to $200 billion valuation in next funding round: Report - The Economic Times

Saudi Arabia's PIF sovereign wealth fund is expected to play a large role in the deal, according to the FT report. PIF holds an indirect interest in xAI through its stake in Kingdom Holdings Company, which has an $800 million investment in the firm.Elon Musk's xAI is preparing to raise more money from investors in a deal that could value the artificial-intelligence company between $170 billion and $200 billion, the Financial Times reported on Friday, citing people close to the discussions. The talks were preliminary and the details could change, the report said. "XAI is not seeking funding right now. We have plenty of capital," Musk posted on X after the FT report. PIF did not immediately respond to a Reuters request for comment. Morgan Stanley said in late June that xAI had completed a $5 billion debt raise alongside a separate $5 billion strategic equity investment, as the startup looks to expand its AI infrastructure through data centers amid intense competition. The AI startup acquired X, Musk's social media business formerly known as Twitter, in March, valuing xAI at $80 billion and X at $33 billion. Musk launched xAI in July 2023 as an alternative to OpenAI's ChatGPT, which said in March that it would raise up to $40 billion at a $300 billion valuation. XAI expects to generate more than $13 billion in annual earnings by 2029, according to numbers revealed by its banker, Morgan Stanley, Bloomberg News reported in June. The company expects $1 billion in gross revenue by the end of this year and plans to spend $18 billion on investments in data centers going forward.

Elon Musk Rejects Reports That xAI Is Looking To Raise Additional Funds At $200 Billion Valuation: 'We Have Plenty Of Capital' - Tesla (NASDAQ:TSLA)

Elon Musk has rejected reports that his artificial intelligence venture xAI is gearing up for a new fundraising round. A report had suggested that the company is looking at a funding round that could value the company between $170 billion and $200 billion. What Happened: Saudi Arabia's Public Investment Fund (PIF) was reported to play a crucial role in this deal, according to a Financial Times report. PIF already has an indirect stake in xAI through its investment in Kingdom Holdings Company, which has committed $800 million to the firm. Amid these reports, Musk commented on X, stating, "xAI is not seeking funding right now. We have plenty of capital." In late June, Morgan Stanley disclosed that xAI had completed a $5 billion debt raise and a separate $5 billion strategic equity investment. This move is part of the startup's strategy to enhance its AI infrastructure through data centers amid increasing competition. See Also: Elon Musk Teams Up With Philippine Billionaire For Satellite Internet Service In Southeast Asia: Report In March, xAI acquired Musk's social media platform, X, formerly known as Twitter, valuing xAI at $80 billion. The company aims to generate over $13 billion in annual earnings by 2029, according to a Reuters report. Subscribe to the Benzinga Tech Trends newsletter to get all the latest tech developments delivered to your inbox. Why It Matters: The potential valuation of xAI at up to $200 billion highlights the company's rapid growth and ambition in the AI sector. Recently, xAI launched Grok 4, touted as the world's most powerful AI model, surpassing competitors like OpenAI's ChatGPT and Google's Gemini. Additionally, Musk announced that Grok 4 will soon be integrated into Tesla Inc. TSLA vehicles, further expanding its applications. Musk's xAI had recently hired Katie Miller, wife of President Donald Trump's Deputy Chief of Staff Stephen Miller, as a communications manager. Check out more of Benzinga's Consumer Tech coverage by following this link. Read Next: Elon Musk's xAI Hires Trump Aide Stephen Miller's Wife Katie Amid Controversial Memphis Data Center Permit Win Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Photo courtesy: JRdes / Shutterstock.com TSLATesla Inc$312.750.93%Stock Score Locked: Want to See it? Benzinga Rankings give you vital metrics on any stock - anytime. Reveal Full ScoreEdge RankingsMomentum29.40Growth90.82Quality48.41Value10.75Price TrendShortMediumLongOverviewMarket News and Data brought to you by Benzinga APIs

Musk's xAI seeks up to $200 billion valuation in next funding round, FT reports

(Reuters) -Elon Musk's xAI is preparing to raise more money from investors in a deal that could value the artificial-intelligence company between $170 billion and $200 billion, the Financial Times reported on Friday, citing people close to the discussions. Saudi Arabia's PIF sovereign wealth fund is expected to play a large role in the deal, according to the FT report. PIF holds an indirect interest in xAI through its stake in Kingdom Holdings Company, which has an $800 million investment in the firm. Morgan Stanley said in late June that xAI had completed a $5 billion debt raise alongside a separate $5 billion strategic equity investment, as the startup looks to expand its AI infrastructure through data centers amid intense competition. xAI and PIF did not immediately respond to Reuters requests for comment. The AI startup acquired X, Musk's social media business formerly known as Twitter, in March, valuing xAI at $80 billion and X at $33 billion. (Reporting by Juby Babu in Mexico City; Editing by Pooja Desai)