Elon Musk Sells X for $33 Billion – What’s Next?

On March 28, 2025, Elon Musk made a major move by selling his social media platform, X (formerly Twitter), to his AI company, xAI, in an all-stock deal worth $33 billion. This merger aims to combine xAI’s AI power with X’s vast user base, potentially changing how users experience the platform (AP News).

The Deal at a Glance

• Transaction Type: All-stock deal

• Valuation of X: $33 billion

• Valuation of xAI: $80 billion

• Debt Included: $12 billion associated with X

Musk sees big potential in combining xAI’s AI expertise with X’s large audience. He believes this will lead to “smarter, more meaningful experiences” for users (Barron’s).

Background and Rationale

Musk bought Twitter in 2022 for $44 billion and rebranded it as X, aiming to turn it into an “everything app.” However, X faced challenges with making money and keeping users engaged. At the same time, xAI, founded in 2023, made big strides in AI, developing models like Grok and building data centers. Merging X with xAI is seen as a way to use AI to improve the platform, especially features like personalized content and user interactions (Investing.com).

Implications for Users

For the 600 million active users of X, the merger could bring new AI-powered features, such as smarter content recommendations and better engagement tools. However, the exact changes and when they’ll happen are still unclear (Wired).

Financial and Strategic Impact

While the $33 billion valuation of X is lower than the $44 billion Musk paid in 2022, this deal could strengthen the combined company’s position in the competitive AI market. It may also impact Musk’s other ventures like Tesla and SpaceX, as the merger allows for more focused resource allocation.

Final Thoughts

Merging X with xAI is Musk’s way of blending social media with cutting-edge AI. Although the full impact of the merger will take time to unfold, it shows Musk’s dedication to advancing AI technology within large digital platforms.