SpaceX acquires xAI in ambitious plan for orbital AI data centres

According to a statement issued on Monday, the acquisition will combine SpaceX’s launch and satellite capabilities with xAI’s AI technologies, creating what Musk described as “the most ambitious, vertically integrated innovation engine on (and off) Earth”. The move comes amid growing pressure on global energy resources as major technology companies expand their AI infrastructure.

Orbital data centres powered by solar energy

Musk revealed plans to deploy a vast constellation of satellites designed to operate as orbital data centres, using near-constant solar power in space to meet AI computing demands. He said these needs cannot be sustainably met on Earth without straining communities and the environment.

SpaceX aims to launch up to one million data-centre satellites using its Starship rocket, which is expected to achieve launch rates of one flight per hour, carrying payloads of up to 200 tonnes.

Valuation and wider business implications

While financial terms and deployment timelines were not disclosed, Bloomberg reported that the combined entity could be valued at around $1.25 trillion. The deal further integrates Musk’s business ecosystem, which includes Tesla and the social media platform X. xAI, operator of the Grok chatbot, was valued at $230 billion earlier this year.