Tesla CEO Elon Musk's AI project, xAI, allegedly consumes approximately $1 billion in funds each month.
Hear me out: Elon Musk's AI venture, xAI, is banking on a transformation of society, but it's got a cash problem that's as huge as its ambitions. According to a report from Bloomberg, xAI is burning through money like nobody's business, and it's expecting to drop a staggering $13 billion this year, that's around a billion bucks a month!
Now, they're finalizing a cool $4.3 billion in fresh equity funding, with plans to raise another jaw-dropping $6.4 billion next year. On top of that, they're reportedly getting corporate debt help from Morgan Stanley to the tune of $5 billion. Why, you ask? Well, to finance their data center development, apparently.
Despite raising tons of dough from investors, xAI's still struggling to keep pace with its expenses. You might think that such prolific fundraising would have them swimming in profits, but nope. That's because their cash burn rate is off the charts. Gizmodo reached out to xAI for some clarification on this whole situation.
So, where the hell is all that money going? Well, besides the domestic robots Musk promises to unleash upon us and his robotaxi business, there's Grok. This "anti-woke" chatbot has stirred up a storm of controversy, spouting off about white genocide. Funny, huh?
In case you didn't know, xAI merged with X (used to be Twitter, snatched by Musk in 2022) earlier this year. Bloomberg's report suggests that xAI plans to use X's endless streams of user- and bot-generated data to train Grok's AI algorithm.
Despite being Musk's baby, xAI's more of an underdog in the AI race. It's up against the likes of OpenAI, Meta, and Anthropic, all aiming to be crowned the AI king. Musk's always been quick to promise big things about automation, robotics, and generative AI. But will his company even survive these early, cash-hungry years? Only time will tell.
- Gizmodo's recent report questions where xAI's staggering $13 billion in estimated expenses this year are going, with concerns about their cash burn rate.
- The tech company, xAI, is not only facing financial troubles but also controversy over its "anti-woke" chatbot, Grok, which has stirred up debate about white genocide.
- xAI's ties with Twitter, now owned by Musk, could potentially help solve its funding issues, as it plans to use X's user-generated data to train Grok's AI algorithm.
- Despite Musk's ambitious projects and promises, including robot taxis and domestic robots, xAI remains an underdog in the AI race, competing with tech giants like OpenAI, Meta, and Anthropic to become the AI king. The company's survival during these early, cash-hungry years remains uncertain.
