WASHINGTON — SpaceX has acquired xAI, an artificial intelligence company also run by Elon Musk, as part of his effort to develop orbital data centers.
In a statement Feb. 2, SpaceX said it acquired xAI, which develops artificial intelligence technologies and operates the social media platform X, formerly known as Twitter. The companies did not disclose the terms of the acquisition. Musk owns a controlling interest in both companies.
In the statement, Musk said combining SpaceX and xAI is intended to advance his goal of developing space-based data centers that he argues could meet the growing computing demands of artificial intelligence more efficiently than terrestrial facilities.
“Current advances in AI are dependent on large terrestrial data centers, which require immense amounts of power and cooling,” Musk wrote. “Global electricity demand for AI simply cannot be met with terrestrial solutions, even in the near term, without imposing hardship on communities and the environment.”
The announcement came three days after SpaceX filed plans with the Federal Communications Commission for a constellation of up to one million satellites designed to operate as orbital data centers. The satellites would rely on solar power to run onboard computing systems supporting AI applications.
“In the long term, space-based AI is obviously the only way to scale,” Musk wrote. “To harness even a millionth of our sun’s energy would require more than a million times the energy our civilization currently uses.”
SpaceX provided few technical details about the proposed constellation in the FCC filing, including the size and mass of the satellites. Musk said the scale of the system would serve as a “forcing function” for the Starship launch vehicle, similar to how the Starlink constellation has driven increased Falcon 9 launch rates.
“With launches every hour carrying 200 tons per flight, Starship will deliver millions of tons to orbit and beyond per year,” Musk wrote, “enabling an exciting future where humanity is out exploring among the stars.”
The acquisition is likely to reinforce SpaceX’s plans for an initial public offering. In a memo to employees in December, SpaceX Chief Financial Officer Bret Johnsen said the company was targeting an IPO in 2026, with proceeds expected to support development of orbital data centers, among other initiatives. Analysts have speculated that such an IPO could raise tens of billions of dollars and value the company at $1.5 trillion.
Musk’s public focus on orbital data centers is relatively recent, emerging only in the past several months. Previously, he emphasized making humanity a multiplanetary species by establishing a sustained presence on Mars.
In the statement, Musk said he remains committed to lunar and Martian exploration, suggesting that factories on the moon could eventually support the construction and launch of large numbers of AI-powered spacecraft.
“The capabilities we unlock by making space-based data centers a reality will fund and enable self-growing bases on the moon, an entire civilization on Mars and ultimately expansion to the universe,” he wrote.
