Table of Contents
- XAI Acquires X in All-Stock Deal, Valuing Social Network at $33 Billion
- XAI Acquires X in All-Stock Deal: Your Questions Answered
- What is the deal between XAI and X?
- What is the valuation of X in this acquisition?
- Why did Musk decide to merge XAI and X?
- How dose this compare to the original acquisition price of X?
- What is XAI’s relationship to OpenAI?
- What is XAI’s place in the AI landscape?
- How does this acquisition affect advertisers on X?
- What does Jasmine Enberg (Emarketer Analyst) say about the growth of X?
- Will the platform content moderation policies change?
Published: March 29, 2025
Elon Musk announced Friday that his generative artificial intelligence start-up, XAI, has acquired the social network X in an all-stock transaction. The deal values the social media platform at $33 billion.
The futures of XAI and X are intimately linked,
Musk stated in a message on X. Musk acquired Twitter, which was later renamed X, in late 2022 for $44 billion.
According to Musk, combining the data, AI models, IT capabilities, and human resources of the two companies will enable the new entity to offer smarter and more profitable
services.
He believes that integrating XAI’s advanced AI expertise with X’s extensive reach will release the immense potential
of the company.
Musk stated that X has more than 600 million users. He added that the transaction values XAI at $80 billion and X at $33 billion (approximately $45 billion minus $12 billion in debt).
Rival to OpenAI
Musk founded XAI in 2023 in response to the success of ChatGPT, the generative AI pioneer launched in late 2022 by OpenAI, a start-up he helped found before severing ties with the other founders.
XAI has developed its own chatbot, Grok, which is fueled by conversations on X. It is designed to provide less woke
answers and incorporate more humor.
On the social network X, Musk has permitted controversial content in the name of free expression.
Growth ‘Fueled by Fear’
Advertisers are reportedly returning to X, with advertising revenue in the United States projected to grow by approximately 17.5% this year, marking the first increase as 2021, according to Emarketer.
Part of this growth is fueled by fear,
said Jasmine Enberg, an analyst, in a statement.
Many advertisers consider spending on X as an operating cost in order to mitigate the potential risk of legal or financial repercussionsif they did not buy advertising space on the social network.Jasmine Enberg, Emarketer Analyst
Alignment with Government
Numerous large companies, particularly in the technology sector, have reportedly taken steps to align with the government, including eliminating diversity promotion programs and softening content moderation policies.
The controversial content that made advertisers flee X is still not acceptable, but we have the feeling that it could become inevitable,Jasmine Enberg, Emarketer Analyst
Musk stated that the merger of his two companies will enable the creation of a platform that not only reflects the world but also actively accelerates human progress.
XAI Acquires X in All-Stock Deal: Your Questions Answered
Published: March 29, 2025
What is the deal between XAI and X?
Elon Musk’s artificial intelligence startup, XAI, has acquired the social media platform X (formerly Twitter) in an all-stock transaction. This means the deal was completed using shares of stock rather than cash.
What is the valuation of X in this acquisition?
The deal values X at $33 billion.Musk acquired Twitter in late 2022 for $44 billion.
Why did Musk decide to merge XAI and X?
Musk believes the futures of XAI and X are ”intimately linked.” Combining the data, AI models, IT capabilities, and human resources of both companies aims to create “smarter and more profitable” services. He envisions that integrating XAI’s AI expertise wiht X’s wide reach will unleash the company’s potential.
How dose this compare to the original acquisition price of X?
Musk acquired X (then Twitter) in late 2022 for $44 billion. The current deal values X at $33 billion.
What is XAI’s relationship to OpenAI?
XAI was founded by Elon Musk in 2023. It was created in response to the success of OpenAI, the generative AI pioneer that launched ChatGPT in late 2022. Musk helped found OpenAI but later severed ties with the company.
What is XAI’s place in the AI landscape?
XAI has developed its own chatbot, Grok, designed to offer less “woke” responses and incorporate humor.This positions XAI as a direct competitor in the generative AI space, challenging OpenAI’s dominance.
How does this acquisition affect advertisers on X?
Advertisers are reportedly returning to X. Advertising revenue in the United States is projected to grow by approximately 17.5% this year, marking the first increase as 2021, according to Emarketer.However, some of this growth might be driven by the legal and financial risks of not advertising on the platform.
What does Jasmine Enberg (Emarketer Analyst) say about the growth of X?
Jasmine Enberg,an analyst at Emarketer,stated that,”Part of this growth is fueled by fear.” Many advertisers consider spending on X as an operating cost to mitigate the potential risk of legal or financial repercussions.
Will the platform content moderation policies change?
Numerous large companies, especially in the technology sector, have reportedly taken steps to align with the government, including eliminating diversity promotion programs and softening content moderation policies. Jasmine Enberg stated that, “The controversial content that made advertisers flee X is still not acceptable, but we have the feeling that it could become inevitable.”
Here’s a summary of the key facts:
| Feature | Details |
| ——————- | —————————————————————————- |
| Buyer | XAI (Elon Musk’s AI company) |
| Seller | X (formerly Twitter) |
| Transaction Type | All-stock deal |
| X Valuation | $33 billion |
| XAI Valuation | $80 billion |
| date of Announcement | Friday, March 29, 2025 |
