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xAI and X merge to form $113B media-tech giant

Published

Mar 31, 2025

TopicAI
Credit: Northcom via Wikimedia Commons

TL;DR

  • Elon Musk's xAI acquires X, in an all-stock deal to create a hybrid platform combining social interaction, AI, and digital commerce.
  • The merged entity, valued at $113 billion, leverages xAI's language models and X's 600 million monthly active users.
  • The enhanced platform is a step towards Musk's vision of an "everything app".

Author

Paddle News Desk

Elon Musk's artificial intelligence company xAI has officially acquired X (formerly Twitter) in an all-stock deal that creates a new type of hybrid platform—one that blurs the lines between social interaction, data infrastructure, AI, and digital commerce.

Powerful combination: The merged entity, valued at $113 billion, combines xAI's cutting-edge language models with X’s large user base, now over 600 million monthly active users. Musk framed the acquisition as a logical next step, posting: "xAI and X's futures are intertwined. Today, we officially take the step to combine the data, models, compute, distribution, and talent."

Social and tech collide: The newly formed xAI Holdings Corp is now positioned as both a consumer platform and a tech infrastructure provider. Analysts expect the merged entity to accelerate development in verticalized AI applications—particularly around messaging, commerce, and payments—potentially challenging legacy players and reshaping how value moves through digital platforms.

'Everything app' inches closer: Since Musk acquired Twitter in 2022 for $44 billion and rebranded it as X, the platform has evolved beyond traditional social media. X is now positioning itself as an everything app, with payments, creator monetization tools, and digital identity functionality already in development. With the integration of xAI, that vision moves closer to reality.

The growth of Grok: xAI, founded in 2023, has rapidly scaled to become a major player in the generative AI space. Its flagship product Grok is already embedded in the X platform and is designed to operate as a real-time conversational assistant. For developers, this opens new possibilities around API integration, AI-native workflows, and smarter interfaces.