What does space have to do with AI? Well, the former (in the form of SpaceX) has a lot of cash that the latter (in the form of xAI) could use to keep developing its incredibly money-and-resource-hungry generative AI, Grok.
The merger makes the world’s newest, most valuable private company, valued at over $1 trillion.
where this is going…
It was Reuters that first reported on the possibility of the two privately held Musk companies merging on January 29, 2026. A mere three days later, it was a reality.
This merger isn’t the first merger of Musk’s companies, although it is between two companies that are more divergent than the xAI and X.com merger of 2025 or when Musk used Tesla stock to buy SolarCity, a clean energy company where, according to The New York Times, he was a major stockholder, and in which his cousin was chief executive.
“In the long term, space-based AI is obviously the only way to scale,” reads SpaceX’s official February 2, 2026 announcement, signed by Musk himself. “To harness even a millionth of our Sun’s energy would require over a million times more energy than our civilization currently uses.
“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. 
” Yes, the cry-laughing emoji is part of the quote. I wouldn’t just put that there.
Doing battle with Google’s Gemini and OpenAI’s ChatGPT, not to mention Perplexity AI and Anthropic’s Claude, is pricey. While SpaceX’s announcement hypes up the ill-defined but lofty-sounding promise of harnessing space’s natural wonders to power AI development by creating orbital data centers, I (and every other journo and analyst) am betting this merger has more to do with the more immediate wonders of cash here on Earth.
The post SpaceX Acquires xAI, Including Social Media Platform X (Formerly Twitter) appeared first on VICE.
