Musk’s xAI seeks up to US$200 billion valuation in next funding round: report
[MEXICO CITY] Elon Musk’s xAI is preparing to raise more money from investors in a deal that could value the artificial intelligence (AI) company between US$170 billion and US$200 billion, the Financial Times reported on Friday (Jul 11), 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 US$800 million investment in the firm.
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 US$5 billion debt raise alongside a separate US$5 billion strategic equity investment, as the startup looks to expand its AI infrastructure through data centres amid intense competition.
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The AI startup acquired X, Musk’s social media business formerly known as Twitter, in March, valuing xAI at US$80 billion and X at US$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 US$40 billion at a US$300 billion valuation.
XAI expects to generate more than US$13 billion in annual earnings by 2029, according to numbers revealed by its banker, Morgan Stanley, Bloomberg News reported in June.
The company expects US$1 billion in gross revenue by the end of this year and plans to spend US$18 billion on investments in data centres going forward. REUTERS
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