Musk: Tesla-xAI Merger ‘Not Out of the Question’

Elon Musk said Tuesday he isn’t ruling out merging his artificial intelligence startup xAI with Tesla (Nasdaq: TSLA), though such a move would require shareholder approval.

“Well, I guess anything is possible,” Musk told CNBC host David Faber when asked about combining xAI with the electric vehicle maker. “There are no plans to do so. It’s not out of the question, but obviously it would require Tesla shareholder support.”

The comments come less than two months after xAI acquired X, formerly Twitter, in a deal valuing the social media platform at $33 billion and xAI at $80 billion.

Tesla shares rose 0.5% Tuesday following Musk’s interview but dipped slightly in after-hours trading. The company’s stock remains about 10% lower than at the start of the year amid struggling first-quarter sales.

Musk had suggested last summer that Tesla invest $5 billion in xAI before the startup acquired X. Any such investment would require approval at Tesla’s annual shareholder meeting, typically held in June.

During the CNBC interview, Musk said Tesla and xAI will continue sourcing AI chips from Nvidia (Nasdaq: NVIDIA) and AMD (Nasdaq: AMD). He revealed xAI has deployed 200,000 GPUs at its Memphis, Tennessee, facility with plans for a 1 million-GPU site nearby.

Business Insider reported xAI is investing at least $400 million in building a supercomputer in Memphis, though the project may face challenges due to the city’s power grid limitations.



Information for this story was found via the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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