Elon Musk’s SpaceX–xAI Play Targets a $1.25 Trillion AI-Space Powerhouse

A merger strategy combining launch, connectivity, and AI to pursue off-planet computing.

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SpaceX has formally bought xAI, transforming Elon Musk's most dependable revenue source into the central hub for his artificial intelligence aspirations. The merged entity integrates launch services, Starlink's worldwide satellite network, the X social platform, and xAI's Grok chatbot into a singular, vertically aligned system designed to pursue both AI supremacy and deep-space superiority. Bloomberg and others estimate the merger at an astonishing $1.25 trillion valuation, with shares anticipated to debut at approximately $527, so establishing the new entity as the most valuable private corporation globally.

The underlying thesis of the headline value is that large-scale AI requires more power than the Earth can sustainably provide; therefore, Musk intends to relocate the computing resources off-planet. SpaceX has submitted proposals to the FCC for a constellation of up to one million satellites functioning as orbiting data centers, utilising near-constant solar exposure to power advanced models. In a memorandum published on the SpaceX website, Musk characterises the amalgamation as “the most ambitious, vertically-integrated innovation engine on (and off) Earth” and envisions a future where space-based AI supports everything from social media to expeditions to Mars. For investors and regulators, the agreement elucidates the Musk strategy: obscure distinctions across enterprises, consolidate capital and data, and wager that the market will embrace a singular, grandiose story encompassing rockets, robotics, and the competition for artificial intelligence.