Elon Musk’s SpaceX officially acquires Elon Musk’s xAI, with plan to build data centers in space

SpaceX has officially acquired Elon Musk’s artificial intelligence startup, xAI, forming a combined entity valued at approximately $1.25 trillion. The acquisition aims primarily to develop space-based data centers, a concept Musk has emphasized due to the limitations and environmental impact of terrestrial AI data centers, which require vast amounts of power and cooling. Musk highlighted that current AI infrastructure on Earth cannot sustainably meet global electricity demands without causing hardship to communities and the environment. The merger unites two Musk-led companies facing financial challenges: xAI reportedly burns about $1 billion monthly, while SpaceX generates most of its revenue from launching Starlink satellites. The integration of SpaceX and xAI is expected to create a continuous revenue stream through the deployment of numerous satellites necessary for these space-based data centers, although Musk did not specify the exact number. This satellite deployment aligns with regulatory requirements mandating de-orbiting every five years, ensuring ongoing business activity. Despite the long-term goal of space data centers, the companies currently have