Elon Musk’s SpaceX Officially Acquires Elon Musk’s xAI, With Plan To Build Data Centers In Space

SpaceX acquires xAI in $1.25T merger to build space-based data centers powering next-gen AI beyond Earth's limits.
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Elon Musk’s SpaceX Officially Acquires Elon Musk’s xAI, With Plan To Build Data Centers In Space
SpaceX Acquires xAI to Build Orbital Data Centers SpaceX has officially acquired artificial intelligence startup xAI in a landmark $1.25 trillion merger announced February 2, 2026. The deal unites Elon Musk's rocket company with his AI venture to pursue an ambitious vision: constructing data centers in orbit to overcome Earth's energy and cooling constraints for next-generation artificial intelligence. This vertical integration creates the world's most valuable private company while positioning SpaceX for a potential mid-2026 IPO. Credit: SpaceX The acquisition addresses a critical bottleneck facing AI development worldwide. Terrestrial data centers now consume staggering amounts of electricity and water for cooling, straining local grids and ecosystems near facilities in Tennessee, Nevada, and other tech hubs. Musk argues space-based infrastructure offers a sustainable alternative by harnessing unlimited solar energy and leveraging the vacuum of space for passive cooling—eli…