Elon Musk xAI Secures $6B To Boost Generative AI Expansion: Details

Elon Musk xAI raises $6B, totaling $12B funding amid lawsuits against OpenAI, and Microsoft over alleged anti-competitive practices.
By Ronny Mugendi
Elon Musk xAI Secures $6B To Boost Generative AI Expansion: Details

Highlights

  • Elon Musk's xAI raises $6 billion, bringing total funding to $12 billion, with backing from major global investors.
  • xAI’s Grok AI model powers X features and is integrated into third-party apps via its API launched in October.
  • xAI operates a Memphis data center with 100,000 Nvidia GPUs, set to double capacity in 2025 with upgraded infrastructure.

Elon Musk xAI has raised $6 billion in its latest funding round, according to a filing with the U.S. Securities and Exchange Commission. This round adds to the $6 billion raised earlier this year, bringing the company’s total funding to $12 billion. The capital injection positions xAI to expand its generative AI initiatives and enhance its competitive edge.

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Elon Musk xAI Achieves $12B Total Funding After Latest $6B Round

According to a recent report, Elon Musk xAI has successfully secured $6 billion from investors, including Andreessen Horowitz, BlackRock, Fidelity, Nvidia, and others. This latest funding round exclusively involved previous investors, many of whom had supported Musk’s acquisition of X (formerly Twitter).

The funds bring xAI total capital raised to $12 billion. The company plans to use this funding to accelerate the development of its generative AI model, Grok, and expand its ecosystem. This substantial financial backing positions the firm to compete with industry leaders such as OpenAI and Anthropic.

Moreover, the Grok AI model, developed by xAI, powers a range of features on X, including a chatbot available to premium and free users in select regions. Known for its functionality, Grok can generate images through the Flux generator, analyze visuals, and summarize trending news.

In October, xAI launched an API allowing developers to integrate Grok into third-party apps and platforms. The company also introduced a standalone iOS app for testing, further extending its generative Artificial Intelligence capabilities.

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Memphis Data Center and Infrastructure Upgrades

To support its ambitious goals, Elon Musk xAI operates a Memphis data center equipped with 100,000 Nvidia GPUs. The facility, constructed in just 122 days, currently relies partly on diesel generators. According to the blog post, the company has plans to double the center’s capacity in 2025, securing approval for additional power.

The upgraded infrastructure will also benefit Tesla, with plans to integrate xAI’s developments into autonomous driving technologies. This expansion reflects Elon Musk’s vision to enhance AI applications across industries.

While Elon Musk’s xAI has made rapid advancements, it continues to face fierce competition. Rivals such as Anthropic and OpenAI have also secured billions in funding.

Following the growing competition, earlier this month, the Tesla CEO filed a lawsuit against OpenAI and Microsoft, accusing them of anti-competitive practices. The lawsuit alleges that OpenAI coerced investors to avoid supporting rivals like Musk’s xAI. Musk’s legal team claims that Microsoft’s $13 billion investment in OpenAI led to conflicts of interest and market manipulation

In addition, Meta CEO Mark Zuckerberg emphasized the need for stricter oversight to prevent nonprofit entities from exploiting their status for financial gain. Joining Elon Musk, Zuckerberg called for a formal investigation into OpenAI’s transition, highlighting potential misuse of tax-exempt donations and resources.

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Ronny Mugendi
Ronny Mugendi is a seasoned crypto journalist with four years of professional experience, having contributed significantly to various media outlets on cryptocurrency trends and technologies. With over 4000 published articles across various media outlets, he aims to inform, educate and introduce more people to the Blockchain and DeFi world. Outside of his journalism career, Ronny enjoys the thrill of bike riding, exploring new trails and landscapes.
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