May 9 2025 – According to a report from The New York Times today, Elon Musk’s AI startup, xAI, is currently engaged in discussions for a fresh round of funding, with its valuation potentially skyrocketing to $120 billion.
In contrast, its rival, OpenAI, recently secured a new funding round in March this year, catapulting its valuation to a staggering $300 billion.
Sources familiar with the matter have revealed that xAI’s funding negotiations are still in their nascent stages. As the talks progress, the startup’s valuation is likely to experience fluctuations. Investors are reportedly mulling over an investment of $20 billion into the company, though the exact figure remains subject to change.
At present, xAI is deeply intertwined with Musk’s social media platform, X. Earlier in March, Musk announced plans to sell X to xAI. Under the terms of an all-stock deal, xAI was valued at 80billion,whiletheXplatformwaspeggedat3.3 billion. Back in December 2023, xAI’s valuation stood at approximately $40 billion following a funding round.
It’s worth noting that Musk was a co-founder of OpenAI alongside Sam Altman and others in 2015. However, he parted ways with the company roughly two years later due to disagreements over its strategic direction.
