xAI Acquires X In $80B Deal, Valuing Twitter Successor At $33B

Elon Musk has announced a significant consolidation of his tech businesses, with xAI, the developers of Grok, acquiring X (formerly Twitter) in an all-stock transaction. According to Musk, the merger values xAI at $80 billion and X at $33 billion. This move comes after Musk purchased Twitter for $44 billion in April 2022, and despite a significant drop in its valuation, the acquisition of X by xAI represents a strategic pivot for Musk's tech empire.

Musk launched xAI in July 2023, a year after purchasing Twitter. The goal of xAI was to "understand reality," and the ongoing feud with former business partner OpenAI CEO Sam Altman was also a driving factor. The merger of xAI and X aims to blend xAI’s advanced AI capability and expertise with X’s massive reach, delivering smarter, more meaningful experiences to billions of people while staying true to the core mission of seeking truth and advancing knowledge.

X, described by Musk as "the digital town square," boasts over 600 million active users. However, rival social media platforms like Meta's Threads and Bluesky have been attempting to attract users away from X. Bluesky's user count surpassed 27.44 million users in January 2025, while Threads had over 320 million monthly active users as of February 2025. The merger could provide a more pragmatic purpose by giving X access to new investors, improved valuation, and a narrative pivot away from Twitter’s chaotic takeover.

Musk made headlines in July of last year when it was revealed that Grok would be trained on X user data. The setting can be disabled, but is on by default for user accounts. Some social media users criticized the announcement, questioning the valuation boost in a deal between two of Musk's own companies. However, the merger could serve a more strategic purpose, allowing xAI to build a platform that not only reflects the world but actively accelerates human progress.