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Musk ‘in Talks’ to Finalise $4.3 billion in New Equity Funding for xAI
- Elon Musk’s AI startup xAI is in talks to finalize $4.3 billion in new equity funding and plans to raise another $6.4 billion in capital for the next year.
- Morgan Stanley is assisting in securing an additional $5 billion in debt to fund the development of xAI's data centers.
- xAI has raised $14 billion in equity since its founding in 2023, with $4 billion remaining at the start of the first quarter.
- The company is working to cover its significant expenses amid a monthly cash burn of $1 billion due to costs surpassing revenues.
- xAI may receive a $650 million rebate from a supplier to reduce expenses.
- The firm is reported to have a valuation of $80 billion by the conclusion of the first quarter, up from $51 billion at the close of 2024.
- The company anticipates spending over half of its funds in the next three months despite not having received the money yet.
- xAI plans for a cash burn of around $13 billion throughout 2025, reflecting the significant financial challenges in the AI industry.
- Elon Musk dismissed reports of cash burn, stating 'Bloomberg is talking nonsense' on his social media platform X.
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