Elon Musk Sells xAI to SpaceX for $1.25 Trillion to Propel His Net Worth to $800 Billion
- Elon Musk has sold xAI to SpaceX in a landmark $1.25 trillion deal to consolidate his business empire and boost his net worth
- The merger aims to create a vertically integrated tech powerhouse combining AI, space, and communication
- Space-based datacenters is envisioned as the future of AI infrastructure amid environmental concerns
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Elon Musk has executed one of the boldest corporate moves in modern tech history, selling his artificial intelligence firm xAI to his aerospace giant SpaceX in a colossal $1.25 trillion transaction.
The deal cements deeper integration across Musk’s sprawling business empire and is expected to push his personal net worth toward an unprecedented $800 billion.
Source: Getty Images
The merger was announced Monday, February 2, 2026, via a statement on SpaceX’s website, confirming that the two companies will combine operations as SpaceX prepares for a highly anticipated stock market debut later this year.
A vertically integrated tech colossus
According to the statement, the combined entity will form what Musk described as “the most ambitious, vertically integrated innovation engine on and off Earth.”
The new structure brings together artificial intelligence, reusable rockets, satellite-powered internet, direct-to-mobile communications, and the X social media platform under one corporate roof.
Through the acquisition, SpaceX absorbs xAI’s flagship products, including the Grok chatbot and ownership of X, formerly Twitter.
According to a report by The UK Guardian, the move underscores Musk’s long-term vision of fusing AI development with space-based infrastructure.
Space-based datacenters at the core
Central to the merger is Musk’s belief that the future of artificial intelligence cannot rely solely on Earth-bound infrastructure. The announcement cited plans for space-based, solar-powered datacenters as a key justification for the deal.
“Current advances in AI depend on massive terrestrial datacenters that require immense power and cooling,” the statement said. “Global electricity demand for AI cannot be sustainably met with land-based solutions without placing hardship on communities and the environment.”
Musk’s conclusion is stark and characteristically sweeping: in the long run, space-based AI is the only viable path to scale.
SpaceX, xAI valuations soar past $1 trillion
Sources familiar with the transaction say the deal values SpaceX at roughly $1 trillion and xAI at about $250 billion. Combined, the company is expected to command a public market valuation well above $1 trillion when it lists, potentially making it one of the most valuable firms in history.
The IPO is reportedly being lined up for early summer, timed symbolically around Musk’s 55th birthday on June 28, a period that also coincides with a rare planetary alignment involving Jupiter and Venus.
Musk’s businesses grow more intertwined
The merger is the latest in a series of moves that blur the lines between Musk’s companies. Earlier in 2025, xAI acquired X in an all-stock deal.
Last month, Tesla disclosed plans to invest $2 billion in xAI, further tightening the web connecting Musk’s ventures.
SpaceX’s valuation has surged as it continues to dominate global satellite launches and secure lucrative US government contracts. A letter to investors in December hinted at an internal valuation nearing $800 billion even before this deal.
xAI: Controversy and momentum
xAI’s rise has not been without controversy. Grok has faced intense criticism over the spread of racist content and nonconsensual sexualized images. Still, investor appetite has remained strong.
A $20 billion Series E fundraising round last month reportedly valued xAI at $230 billion.
Source: Twitter
Speculation around the SpaceX-xAI merger intensified after Reuters first reported it.
Musk offered a characteristically terse confirmation, replying “yes” to a post on X referencing the deal.
With this merger, Musk has doubled down on a future where AI, space, and communication converge, and where scale is measured not just on Earth, but beyond it.
Elon Musk's net worth rises to highest level ever
Legit.ng earlier reported that Elon Musk, the chief executive of Tesla, has emerged as the wealthiest individual ever recorded after his net worth climbed to $648 billion as of Wednesday, December 17, according to data from Bloomberg billionaire index.
Musk’s fortune jumped after SpaceX launched a tender offer earlier this month that valued the private rocket company at about $800 billion, up from roughly $400 billion in August 2026.
The deal added an estimated $168 billion to Musk’s wealth, pushing his net worth as high as $677 billion at one point on Monday.
Proofreading by Kola Muhammed, copy editor at Legit.ng.
Source: Legit.ng
