Musk announces xAI re-org following key departures, SpaceX merger

SpaceX CEO Elon Musk announced Wednesday that the company’s xAI artificial intelligence initiative is undergoing a restructuring that “requires parting ways with some people.”

Musk said the revision was made “to increase execution speed.” Publish on X. It did not say which employees may have been laid off as a result of the restructuring or which employees may have resigned voluntarily.

“We are hiring aggressively,” Musk added.

Earlier this week, xAI co-founders Jimmy Ba and Tony Wu announced their departure, following Igor Babuschkin, Kyle Kosic, Christian Szegedy and other founding members. Greg Yanghad been separated before.

Last week, Musk announced a record-breaking, all-stock transaction in which aerospace and defense juggernaut SpaceX acquired xAI, which owns and operates the social network X and developer of the embattled AI chatbot and image generator Grok.

The deal would value SpaceX at $1 trillion after the merger and xAI at $250 billion, according to documents viewed by CNBC. Musk had previously used xAI to acquire X, formerly Twitter, in another stock transaction announced in March 2025.

The co-founders’ departure and this week’s restructuring come as SpaceX prepares to go public later this year and xAI faces regulatory investigations in several jurisdictions in Europe, Asia and the United States.

The investigations are investigating whether xAI violated regional regulations after Grok enabled the mass creation and publication of non-consensual, sexually explicit images, colloquially known as deepfake porn. The images were based on photographs of real people, including children.

Musk launched xAI with 11 others in 2023 to compete against OpenAI and Google. According to its website at the time, the company’s stated goal was to “understand the true nature of the universe.”

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