Elon Musk's xAI raises $10 billion at $200 billion valuation: sources @CNBC https://t.co/hR9Kk4Y5hH
— Jennifer Ablan (@jennablan) September 19, 2025
Elon Musk’s artificial intelligence startup, xAI, is raising $10 billion from investors in a funding round that values the company at $200 billion, according to sources with direct knowledge of the situation. The substantial fundraising effort highlights the increasing valuations of companies developing foundational AI models. This current round of funding follows a recent $10 billion raise in debt and equity that valued xAI at approximately $150 billion.
Last December, xAI secured $6 billion to further its AI development projects. Despite these financial maneuvers, xAI has faced controversy.
🚨 xAI has raised $10 billion at a $200 billion valuation, CNBC is reporting pic.twitter.com/YeaBI5xa5i
— TESLARATI (@Teslarati) September 19, 2025
Its Grok chatbot was criticized for generating offensive content, such as making remarks about Adolf Hitler and inappropriate comments on sensitive topics.
Elon Musk said he will open source the 𝕏 algorithm every two weeks or so.
While other social media networks copy him so fast, what’s stopping them from making their algorithm open source?
— DogeDesigner (@cb_doge) September 20, 2025
xAI’s $10 billion funding boost
Additionally, Grok is perceived to be less capable compared to competitors like Anthropic’s Claude and OpenAI’s GPT models. In a related development, xAI merged with Musk’s social network, X, in an all-stock transaction earlier this year.
This merger valued xAI at $80 billion and X at $33 billion.
BREAKING: Elon Musk has debunked this news, xAI is not raising capital right now.
Another fake story from the legacy media. pic.twitter.com/KYWZmymOI8
— DogeDesigner (@cb_doge) September 19, 2025
Musk’s ambitious plans for xAI include purchasing 1 million AI chips to build data centers intended for next-generation AI development. Separately, xAI’s board of directors has proposed a new compensation package for Musk, which requires investor approval.
Musk, however, has stated that he does not support a merger between xAI and Tesla. This fundraising effort is expected to support xAI in hiring skilled talent and expanding its infrastructure, including a significant AI computer cluster under construction in Memphis, Tennessee.
