Elon Musk has confirmed that SpaceX will merge with artificial intelligence startup xAI, bringing two of his most ambitious private ventures under a single corporate structure as the space company moves closer to a potential public listing.
In a statement published on SpaceX’s website, Musk said the merger is aimed at building a deeply integrated technology platform combining AI, space launch systems, satellite internet, and real-time communications.
“This transaction brings together rockets, AI, space-based connectivity, and large-scale computing into one unified innovation engine,” Musk said, adding that the merger represents a long-term vision rather than a short-term financial move.
Focus on Space-Based AI Infrastructure
Musk said the primary motivation behind the merger is the development of space-based data centres and AI systems, arguing that Earth-bound infrastructure will soon be unable to meet the energy and cooling demands required for next-generation artificial intelligence.
According to Musk, global electricity constraints make it increasingly difficult to scale AI using terrestrial data centres alone, positioning orbital infrastructure as a potential solution for long-term expansion.
Cross-Company Collaboration Already Underway
Engineers from Tesla, SpaceX, and xAI have already been collaborating across projects, highlighting the operational overlap between Musk’s companies. Tesla recently disclosed a $2 billion investment in xAI, further underscoring the deepening integration within Musk’s business ecosystem.
IPO Plans in Focus
SpaceX has been widely reported to be exploring an initial public offering that could raise up to $50 billion, with valuations estimated at around $1.5 trillion. It remains unclear how the inclusion of xAI will affect valuation, structure, or timing of the IPO.
The merger was first reported earlier by Bloomberg.
