Elon Musk Raises $10 Billion for xAI, Plans 1 Million GPUs by 2027

Elon Musk, the CEO of Tesla and SpaceX, has recently raised $10 billion for his artificial intelligence company, xAI. This significant funding will be used to enhance the company's Colossus supercomputer in Memphis and to accelerate the development of its chatbot, Grok. The funds are split evenly between secured loans and strategic investments, with Morgan Stanley playing a key role in the financing.

Musk's ambitious plans include installing 1 million GPUs by 2027, with 200,000 already in place. He is investing heavily in Nvidia and AMD, bypassing subsidies by paying for the hardware upfront. The integration of Grok into the X platform, formerly known as Twitter, allows the AI to broadcast its responses directly to the public without filters. Musk aims to use Grok as an ideological tool in the increasingly polarized political landscape of the United States.

The fundraising comes amid a heated exchange between Musk and Donald Trump. Trump criticized Musk on Truth Social, accusing him of receiving excessive subsidies. Musk responded by calling for an end to all subsidies and threatened to found a new political party, the America Party, if Trump's proposed "Big Beautiful Bill" is adopted. The bill, which includes massive tax cuts and healthcare cuts, has been described by Musk as a "disgusting abomination."

Musk has also pledged to support opponents of Republicans who back the bill, stating that they will lose their primaries. This escalation marks a significant shift in the political dynamics, with Musk using his influence and resources to challenge the status quo. His investments in green infrastructure, including $2 billion for improving Colossus with liquid cooling systems and water recycling, further underscore his commitment to reshaping the political battleground.

In parallel, Senator Cynthia Lummis has proposed crypto tax relief, which could attract Web3 players and potentially expand Musk's electorate. This move aligns with Musk's anti-establishment stance and his broader strategy to leverage technology for political influence. xAI's workforce has quadrupled since its Series C funding round, and the company is now valued at $80 billion, a significant increase from its previous valuation.

Musk's actions and statements have made him a polarizing figure, drawing both admiration and criticism. His use of Grok as a tool for ideological influence and his willingness to challenge political norms have positioned him as a key player in the evolving landscape of technology and politics. As the battle between Musk and Trump continues, the implications for both the tech industry and the political arena remain to be seen.