xAI
Elon Musk (division president: Michael Nicolls)
Data verified as of Jul 17, 2026
Summary
xAI is Elon Musk's artificial-intelligence company — founded in March 2023, merged with the X social platform in March 2025, acquired by SpaceX in a $250B all-stock deal on February 2, 2026, and rebranded SpaceXAI on July 6, 2026. It builds the Grok model family, whose latest release, Grok 4.5 (July 9, 2026, co-developed with Cursor), Musk pitches as 'Opus-class but faster and cheaper' at $2/$6 per million tokens; Grok features reached ~117 million monthly active users by March 2026, third in the US behind ChatGPT and Gemini. Its Memphis-area Colossus supercomputer complex — roughly 555,000 Nvidia GPUs expanding toward 2 GW and 1 million GPUs — has become a business in itself, leased to Anthropic ($1.25B/month for all of Colossus 1) and Google ($920M/month from October 2026), though it also drew an April 2026 NAACP lawsuit over gas-turbine emissions in South Memphis. Grok is embedded in X (600M MAU), Tesla vehicles, and the Pentagon's GenAI.mil platform. The combined SpaceX went public on June 12, 2026 in history's largest IPO (~$85.7B raised), and the division's next act — the 6-trillion-parameter Grok 5 — is still training on Colossus 2 after slipping past two target windows.
Main Products
xAI's frontier LLM line. Grok 4.5 (July 9, 2026), the first model co-developed with Cursor, is a mixture-of-experts system Musk describes as 'Opus-class, but faster, more token-efficient and lower cost,' aimed at coding, agents and knowledge work; Grok 4.1 Fast offers a 2M-token context window for agentic tool use.
Grok 4.5 launched publicly July 9, 2026 via the API, Grok Build and Cursor (EU availability delayed to mid-July); benchmarks are competitive but by xAI's own numbers 'just short of best-in-class.' The 6T-parameter Grok 5 is still training on Colossus 2.
Grok's consumer surface: the grok.com site and iOS/Android apps, deep integration into the X platform for its ~600M monthly users, and in-vehicle Grok voice assistant in Tesla cars — a distribution moat no rival lab has.
~117M monthly active users of Grok features as of March 2026 (per SpaceX's IPO filing), making Grok the #3 AI assistant in the US behind ChatGPT and Gemini; paid tiers are SuperGrok (~$30/mo) and SuperGrok Heavy (~$300/mo).
The Memphis-area AI training complex built in 122 days in 2024, now ~555,000 Nvidia GPUs (H100/H200/GB200) across Colossus 1 and the gigawatt-class Colossus 2, targeting 1M+ GPUs and ~2 GW. xAI trains Grok 5 on Colossus 2 while leasing Colossus 1 to Anthropic and capacity to Google — though its gas turbines are the subject of an NAACP emissions lawsuit.
Colossus 1 (~220K GPUs, 300 MW) fully leased to Anthropic at $1.25B/month through May 2029; Colossus 2 hosts xAI's own frontier training plus Google's 110K-GPU contract from October 2026. NAACP suit over turbine emissions filed April 2026; the Trump administration moved to intervene and dismiss in June 2026.
A suite of Grok frontier models and tooling (Deep Search, Tool Use) packaged for US national-security, federal, state and local customers — spanning a DoD contract, GSA-wide availability, and embedding in the Pentagon's internal GenAI.mil platform at Impact Level 5.
Deployed: $200M-ceiling DoD CDAO contract (July 2025), GSA schedule at $0.42 per agency for 18 months (Sept 2025), and a February 2026 Pentagon agreement putting Grok into classified systems and GenAI.mil for 3 million DoD military and civilian employees.
What's Next
Close the $60B Cursor (Anysphere) acquisition
Complete the all-stock acquisition of Cursor-maker Anysphere announced June 16, 2026 — the largest acquisition of a venture-backed startup ever — pending regulatory approval, folding Cursor's coding data into Grok's training pipeline after the jointly built Grok 4.5.
Scale Colossus toward 1 million GPUs / 2 GW
Build out the third Memphis-area building (purchased December 2025) and Colossus 2 toward the stated 1M+ GPU, ~2 GW target — while defending the April 2026 NAACP emissions lawsuit and securing power for a complex whose demand rivals the entire Memphis grid peak.
Operations & Revenue
Since the February 2, 2026 all-stock acquisition (and the June 12 record IPO), xAI operates as SpaceX's AI division — rebranded SpaceXAI on July 6, 2026 — spanning the Grok model family, the X platform, the Colossus supercomputer complex, and government AI deployments. Grok reached ~117M monthly active users; Colossus (~555K GPUs, expanding toward 2 GW) now doubles as a compute-leasing business serving Anthropic and Google; and the division is absorbing Cursor-maker Anysphere via a $60B acquisition expected to close in Q3 2026. Heavy losses continue ($6.4B operating loss on $3.2B revenue in 2025) as Grok 5 trains on Colossus 2, with Musk eyeing space-based data centers longer term.
Revenue Streams
Advertising on the X platform (~$3.3B+ annualized by end-2025) plus X Premium subscription tiers (~$1B annualized by Feb 2026), which bundle Grok access — the division's largest revenue base.
SuperGrok (~$30/month) and SuperGrok Heavy (~$300/month) on grok.com and the Grok apps, plus Grok entitlements inside X Premium plans.
Usage-based Grok API access (Grok 4.5 at $2/$6 per million tokens) plus 'Grok for Government' — a $200M-ceiling DoD contract, GSA-wide availability at $0.42 per agency, and Grok embedded in the Pentagon's GenAI.mil at Impact Level 5.
Key Metrics
Employees
1,200+ (2025, standalone xAI; now SpaceX's AI division)
Est. Annual Revenue
$3.2B in 2025 (combined xAI + X, with a $6.4B operating loss per SpaceX's IPO filing); analysts put the standalone AI business at a ~$1.7–3.3B annualized run-rate by mid-2026, before compute-leasing contracts with Anthropic ($1.25B/mo) and Google ($920M/mo from Oct 2026) that add roughly $26B annualized once fully ramped
Timeline
On January 6, 2026 xAI closes a $20B Series E — above its $15B target — with Nvidia, Cisco, Fidelity, Valor Equity Partners, StepStone, QIA, MGX and Baron Capital participating. Tesla contributes $2B despite a November 2025 Tesla shareholder vote that failed to endorse the investment once abstentions were counted.
On February 2, 2026 SpaceX acquires xAI in an all-stock transaction valuing xAI at $250B and the combined company at $1.25T (0.1433 SpaceX shares per xAI share), folding Grok and X into SpaceX — partly to fund xAI's cash burn and pursue Musk's plan for space-based data centers. By late March all eleven co-founders other than Musk had departed; ex-Starlink VP Michael Nicolls became president of the division on April 10.
In February 2026 the Pentagon agrees to embed Grok in GenAI.mil, its internal AI platform serving 3 million military and civilian employees at Impact Level 5, including use in sensitive workflows. In April the NAACP sues over Colossus 2's gas-turbine emissions in the Memphis area — alleging 1,200–2,000 tons of smog-forming NOx annually — with the Trump administration moving in June to intervene and dismiss the case.
In May 2026 Anthropic agrees to pay $1.25B per month through May 2029 (over $40B total) to rent all of Colossus 1's ~220,000 GPUs and 300 MW for Claude inference; on June 5 Google signs a $920M-per-month deal (~$30B through June 2029) for ~110,000 GPUs at Colossus 2 starting October 2026 — xAI having shifted its own training to Colossus 2.
The combined SpaceX–xAI lists on Nasdaq as SPCX on June 12, 2026, raising ~$85.7B (with overallotment) in the largest IPO in history — shares priced at $135 closed their first day up 19% at $160.95, a ~$2.1T market cap. Four days later SpaceX agrees to acquire Cursor-maker Anysphere for $60B in stock, the largest acquisition of a venture-backed startup ever, feeding Cursor's coding data into Grok's training pipeline.
On July 6, 2026 xAI completes its rebrand to SpaceXAI with a new logo and @SpaceXAI handle (Grok keeps its name). On July 8–9 it releases Grok 4.5, its first model co-developed with Cursor — a mixture-of-experts model Musk calls 'Opus-class, but faster, more token-efficient and lower cost,' trained on tens of thousands of Nvidia GB300s and priced at $2/$6 per million tokens.
xAI unveils Grok 4 and the $300/month SuperGrok Heavy tier on July 9, 2025 — days after Grok generated widely condemned antisemitic posts on X. On July 14 the DoD's Chief Digital and AI Office nonetheless awards xAI a $200M-ceiling contract alongside its 'Grok for Government' launch, and in September the GSA offers Grok to federal agencies for $0.42 per agency for 18 months.
xAI stands up Colossus in a former Electrolux factory in Memphis, Tennessee — 100,000 Nvidia H100 GPUs online in 122 days from conception, called the world's largest AI training cluster at launch. It doubles to 200,000 GPUs by December 2024, though its unpermitted methane gas turbines spark a lasting environmental fight with South Memphis residents.
xAI is incorporated on March 9, 2023 and announced publicly on July 12, 2023, with Musk and eleven founding AI researchers (including Igor Babuschkin, Christian Szegedy, Greg Yang and Yuhuai Wu) setting out to 'understand the true nature of the universe' — and to challenge OpenAI, which Musk co-founded and left.
Funding
Cumulative disclosed raise · dated rounds