Wednesday, February 4, 2026-Elon Musk has officially merged his artificial intelligence start‑up xAI into SpaceX, creating one of the most valuable private tech companies in the world with a combined valuation of about $1.25 trillion.
The deal brings xAI’s AI models, including its Grok language technology and the social platform X, under SpaceX’s umbrella, uniting aerospace hardware with cutting‑edge artificial intelligence development. This strategic move positions the combined entity as a vertically integrated powerhouse spanning space launch systems, satellite internet, real-time data platforms, and generative AI.
Musk said the merger aims to tackle one of the biggest challenges facing AI today: the enormous power, cooling, and infrastructure demands of large AI models. By combining xAI’s software with SpaceX’s Starlink satellite network and future space-based platforms, Musk envisions deploying AI data centers in orbit powered by solar energy, which he believes will be far more efficient and scalable than terrestrial facilities. This approach is central to his argument that space is the next frontier not only for rockets but also for the future of computing and artificial intelligence.
The merger also reshapes SpaceX’s path toward a potential initial public offering (IPO) later in 2026, with analysts saying the expanded business model could appeal strongly to investors seeking exposure to both AI and space technology. xAI shareholders will receive SpaceX equity under the terms of the deal, and some executives may have the option to take cash instead. Musk’s broader mission to unify his companies — including SpaceX, xAI, X, and his other ventures — underscores a bold bid to create an integrated innovation engine that could redefine how AI and space systems evolve together.
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