Musk’s xAI Burns Through $1 Billion a Month as Costs Pile Up

Elon Musk’s beginning of artificial intelligence, Xai, according to people informed according to the company’s financial, further AI models in front of limited revenues in front of the competition is burning between 1 billion dollars per month.

The company’s cash bleeding rate offers a definite example of its unprecedented financial demands in Xai, where the artificial intelligence industry, especially the revenues, is slow.

In order to cover the gap, Musk’s initiative is currently trying to gather $ 9.3 billion debt and equity, according to people who are briefed in the terms of the agreement, asking for information not to be identified because it is special. However, even before the money was at the bank, the company said that the company only plans to spend more than half over the next three months.

In 2025, according to the details shared with investors, Xai, who was responsible for AI, is responsible for Chatbot Grook, is reflected in the company’s abolished cash flow and awaits to burn for about $ 13 billion. As a result, he added that the efforts to collect productive donations do not comply with the expenses.

The company spokesman refused to comment.

Partially, the losses buy special computer chips needed to educate all AI companies’ developed AI models such as Gok and Chatgpt while building the server farms of all AI companies. In a shareholder of the CEO Chairman Harvey Schwartz, Carlyle Group Inc., an AI infrastructure, estimates that capital will be deployed by $ 1.8 trillion by 2030 to meet the request to create an infrastructure.

“Model builders will try to increase the debt and burn too much money, Jord said Jordan Chalfin, Senior Analyst and Technology President at Creditsights. “The field is fighting for very competitive and technical superiority.”

However, he struggled to develop income streams at the same rate as Musk’s AI race, directly as Openai and Anthropic competitors.

Almost none of these companies offered public figures about their finances, while Bloomberg had previously reported that Openai, the creator of Chatgpt, expected $ 12.7 billion this year. In Xai, revenues are expected to be only 500 million dollars this year and next year, $ 2 billion will rise to the north.

What Xai is with is a CEO, the richest man in the world, a CEO, Musk and his reserves that shows that he is willing to spend in big, futuristic projects long before he starts to produce money. In 2017, Bloomberg was burned for $ 1 billion in a quarter to pay for the production of Model 3 cars, Musk’s largest company. SpaceX, in the meantime, continued its stable losses for years as it progresses to the target of reconnaissance between long -term planets. However, even against this ground, great losses in Xai come to the fore.

Musk’s team in Xai is competing to improve the AI ​​that can compete with people, and finally believes that they have advantages to allow them to catch up with their peers. While some competitors rented chips and server space, it pays most of the Xai infrastructure and gets direct access through Musk’s social media company X, which has previously bought an important stock of its most popular and high -powerful computer chips. Musk said he expects Xai to continue to buy more chips.

After merging with X recently, it is hopeful that the company’s models can educate the company’s models in the archives that have been re -established in abundance and continuously, instead of paying data sets such as AI managers and other AI companies.

These potential advantages said that Xai would reflect in an optimistic way that it would be profitable by 2027. Bloomberg reported that Openai expected to be positive by 2029.

These projections have been sufficient to win many investors, especially before the last breakdown of the relationship between Musk and President Donald Trump, along with Musk’s famous status and political power. Potential Xai investors were told that the company’s valuation increased from $ 51 billion to $ 80 billion at the end of 2024 at the end of the first quarter. Investors included Andreesen Horowitz, Sequoia Capital and Vy Capital.

For now, Xai is competing to make enough money to keep up with its great spending. Finance, 2023 and June in June between Xai $ 14 billion of self -sacrifice, he said. From this, he said that only 4 billion dollars remained at the beginning of the first quarter and the company expects almost all of the money remaining in the second quarter.

The company said that the company is currently concluding a new equity financing of $ 4.3 billion and planning to collect a capital of $ 6.4 billion next year, according to investors. And this is over the $ 5 billion debt that Bloomberg had previously reported that Morgan Stanley had previously helped Morgan Stanley. Persons are expected to help the corporate debt to pay the data center development of Xai. Instead, other companies decided to finance projects.

The company also told investors this week to get some help from one of its producers from a discount of $ 650 million.

Bloomberg had early signs that investors were hesitant to borrow the company’s money under proposed conditions. People who are familiar with negotiations, the company, in response to the questions encountered in the process of gathering donations, said that more detailed financial information to certain investors on Monday. However, the agreement attracted more attention and concluded his self -donation, as the company changed some of the terms of the agreement – to be more investor friendly – to be more investor friendly.

Morgan Stanley spokesman, Xai’s bank responsible for debt sales, refrained from commenting.

With the help of Tom Conteriano and Peter Pae.

This article was created from an automatic news agency feeding without changing the text.