Elon Musk Negotiates Merger Between SpaceX and xAI: Bloomberg

Billionaire Elon Musk is in preliminary negotiations to merge his spacecraft manufacturing company SpaceX with his artificial intelligence (AI) startup xAI, according to Bloomberg, citing sources.

The agency's sources clarified that SpaceX and xAI have already informed some investors about these plans. They indicated that the companies may announce an agreement this week. However, Bloomberg's sources noted that the talks could drag on or fail altogether.

If the agreement is finalized, the two largest private companies in the world will merge. According to the agency, xAI raised $200 billion in September 2025, while SpaceX planned to sell about $800 billion in shares in December.

The main driving force behind the merger is the need for more capital in the artificial intelligence industry. Bloomberg reports that xAI's rapid cash burn rate (about $1 billion per month) has prompted Musk to blur corporate boundaries, consolidate capital, and reassess the viability of spinning off his projects.

Moreover, by merging xAI and SpaceX, Musk could also actualize his idea of launching data centers in space.

Bloomberg also reported on January 30 that ahead of its IPO, SpaceX is discussing the possibility of merging with Tesla as well as alternative merger options with xAI. According to agency sources, the company has considered merging SpaceX with Tesla, with some investors promoting this idea.