SpaceX Acquires XAI for $1.25 Trillion

SpaceX's acquisition of Elon Musk's AI startup, XAI, values the combined entity at $1.25 trillion, aiming to create a vertically integrated tech company. A primary motivation behind the merger is to build orbital data centers, addressing the immense power and cooling demands of terrestrial AI data centers. This initiative seeks to alleviate the strain on communities and the environment caused by electrical subsidies and resource consumption. While XAI has faced criticism regarding environmental impact, SpaceX generates 80% of its revenue from Starlink satellites, ensuring long-term launch demand due to satellite de-orbiting regulations. The merger also addresses XAI's funding challenges compared to competitors like OpenAI and Anthropic, despite Grok's integration with Twitter.