Elon Musk Is Rolling xAI Into SpaceX—Creating the World's Most Valuable Private Company

By fusing SpaceX and xAI—which acquired X last year—Elon Musk tightens his grip over technologies that shape national security, social media, and artificial intelligence.

Elon Musk’s rocket and satellite company SpaceX is acquiring his AI startup xAI, the centibillionaire announced on Monday. In a blog post, Musk said the acquisition was warranted because global electricity demand for AI cannot be met with “terrestrial solutions,” and Silicon Valley will soon need to build data centers in space to power its AI ambitions.

“In the long term, space-based AI is obviously the only way to scale,” Musk wrote. “The only logical solution therefore is to transport these resource-intensive efforts to a location with vast power and space. I mean, space is called ‘space’ for a reason.”

The deal, which pulls together two of Musk’s largest private ventures, values the combined entity at $1.25 trillion, making it the ...