Elon Musk restructures xAI after resignation of co-founders — Here’s what has changed

Billionaire Elon Musk said on February 12 that xAI, the artificial intelligence startup recently acquired by SpaceX, is reorganizing. This comes after two co-founders, Jimmy Ba and Tony Wu, became the last of the team’s original 12 members to resign. The founding team is now halved, including Elon Musk.

Since the back-to-back resignations, there has been a lot of talk among leadership about xAI’s progress and speculation about problems.

In a post on X (formerly Twitter), Elon Musk wrote that the restructuring was done “a few days ago to increase execution speed.” He added: “When a company grows, especially as fast as xAI, the structure needs to evolve just like any living organism. This unfortunately required parting ways with some people. We wish them success in their future endeavors.”

The world’s richest man also stated that he will continue to expand the operations of his artificial intelligence initiative, saying, “We are recruiting aggressively. If the idea of ​​mass drivers on the Moon interests you, join xAI.”

WATCH: Elon Musk addresses xAI staff

In a post from xAI’s official account, the company also shared Elon Musk’s address to employees, which lasted more than 45 minutes. “Since xAI was founded just 30 months ago, the small and talented team has made remarkable progress. The future has never looked more exciting!” he stated.

Elon Musk is restructuring xAI: Here’s all we know

The billionaire told staff at a meeting Wednesday that XAI will be organized into four key areas: Grok’s chatbot and voice product; Coding; Imagine video product; and Macrohard, an AI software company driven by digital agents. Musk presented the plan at a meeting with xAI employees, which he made public on the X social network.

“What matters is speed and acceleration,” he told employees. “If you move faster, you will become a leader.” He also thanked those who left the company.

The meeting follows the consecutive departures of the startup’s co-founders Jimmy Ba and Tony Wu, as well as several other staff members who have left in the past few days.

Aman Madaan, who joined xAI in 2024, leads the main chatbot and voice division. He stated at the meeting that xAI is rapidly improving its models, driven by the success of OpenAI’s voice model. “We had nothing, but in six months we developed it from scratch,” he said.

Co-founder Manuel Kroiss will lead the coding team, while co-founder Guodong Zhang will assist with coding and oversee video production. Toby Pohlen, who was also part of the founding team, will be responsible for Macrohard, a division at Microsoft Corp. called gaming.

“A lot of the AI ​​computation will be around understanding real-time video rendering,” Musk said. “And we expect to be a leader on this.”

They all emphasized that xAI is looking to hire.

Twelve original xAI co-founders, including Musk, founded the company in 2023. Ba and Wu are the fifth and sixth people to leave the group in the last two years. Kyle Kosic left in 2024, followed by Igor Babuschkin and Christian Szegedy in 2025. Another co-founder, Greg Yang, said last month he would step back from his role after being diagnosed with Lyme disease.

According to Bloomberg, the exits follow xAI’s recent merger with SpaceX; this merger valued the combined company at $1.25 trillion. The deal could ease a funding crunch for xAI, which has raised huge amounts of capital by spending cash to build data centers, buy expensive computing chips and pay talent.

xAI has a large Colossus data center site in Memphis, Tennessee, and plans to expand the complex. The company has already purchased a third building at the site that will increase its computing capacity to almost 2 gigawatts, Musk said late last year. This expansion, technically crossing state lines in Mississippi, would involve an investment north of $20 billion. The new building, which Musk calls Macroharder, will require 10,000 to 20,000 GB300 systems, Musk said in the meeting.

Nikita Bier, who is in charge of X’s product, said the social network and adjacent apps, including Grok, have reached nearly 1 billion users. He said January was the best month ever for X in terms of attendance. He also noted that new users are spending 55% more time per day on the app than they did six months ago. He said the app has been “rebuilt to be better than ever” and now generates $1 billion in annual recurring revenue based on subscriptions.

Musk said the company will launch a new X Chat application for those who want to use it for messaging purposes only. He reiterated that he would not add advertising to Grok. He said that X Money, an initiative that the social network has been working on for years and that will be used to send money within the app, will be available to a limited number of external testers in the coming months. “This will be where all the money is. This will be a game changer,” Musk said.

(With input from Bloomberg)