Elon Musk Sells X to SpaceX in Strategic Corporate Reshuffle

Elon Musk’s social networking platform X (formerly Twitter) has officially come under the ownership of SpaceX, marking a major restructuring across Musk’s companies. The development follows SpaceX’s acquisition of xAI, Musk’s artificial intelligence company focused on AI labs, advanced models, and large-scale data centres.

Musk had earlier merged xAI and X in May 2025, laying the groundwork for deeper integration between social media data, artificial intelligence, and next-generation computing infrastructure.

SpaceX–xAI Merger Aims to Build a Vertically Integrated Innovation Engine

AI, Rockets, Satellites, and Connectivity Under One Roof

According to SpaceX, merging xAI with its operations is intended to create a “vertically integrated innovation engine on (and off) Earth.” The strategy combines artificial intelligence, rocket launch systems, satellite-based internet, and direct-to-mobile communications into a single ecosystem.

This integration positions SpaceX not just as a space transportation company, but also as a future global AI infrastructure provider.

xAI and Grok Already Deeply Integrated With X

xAI is best known for Grok, its AI chatbot that is already embedded within the X platform. With X now under SpaceX’s ownership, Musk is expected to align user-generated data, AI model training, and space-based computing more closely.

While SpaceX traditionally focuses on launch services, satellites, and space exploration, the merger allows it to directly leverage xAI’s artificial intelligence technologies for large-scale innovation.

SpaceX Files FCC Application for Orbital Data Centre

Plan to Launch One Million Satellites

SpaceX has recently filed an application with the US Federal Communications Commission (FCC) seeking approval to create an “orbital data centre”. The proposal involves launching a million satellites capable of supporting computing and data-processing tasks in space.

If approved, this would mark one of the most ambitious infrastructure projects ever attempted beyond Earth.

Musk Explains Why AI Compute May Move to Space

Power and Cooling Are Major Constraints on Earth

Musk highlighted that rapid advancements in artificial intelligence rely on increasingly massive terrestrial data centres, which demand enormous power supplies and advanced cooling systems.

He said space-based AI infrastructure could overcome these limitations by tapping into solar energy:

“The only logical solution, therefore, is to transport these resource-intensive efforts to a location with vast power and space. I mean, space is called ‘space’ for a reason,” Musk said.

Near-Constant Solar Power Makes Space Ideal for AI

Musk pointed out that space offers near-constant solar power, significantly reducing energy constraints compared to Earth-based facilities. He added that satellites could operate with lower long-term operating and maintenance costs, enabling unprecedented scaling of computing capacity.

According to Musk, satellite-based computing will fundamentally change how AI workloads are processed.

Vision of Orbital AI Data Centres

Towards a Kardashev Type II Civilisation

Outlining his long-term vision, Musk said:

“Launching a constellation of a million satellites that operate as orbital data centres is a first step towards becoming a Kardashev II-level civilisation—one that can harness the Sun’s full power—while supporting AI-driven applications for billions of people today and ensuring humanity’s multi-planetary future,” Musk wrote.

The Kardashev Scale measures a civilisation’s technological advancement based on energy usage, with Type II representing the ability to harness the full energy output of a star.

AI Compute Could Shift to Space Within 2–3 Years

Musk further stated that within the next two to three years, the lowest-cost method of generating AI compute could move to space. This shift could enable faster and more cost-efficient AI model training and real-time data processing at a scale currently impossible on Earth.

Such a transition would redefine the economics of artificial intelligence and cloud computing.

Why This Move Matters

The sale of X to SpaceX signals:

• Deeper integration between social data and AI training

• A shift toward space-based computing infrastructure

• Expansion of SpaceX beyond launches into AI and digital services

• A long-term bet on solar-powered orbital data centres

Together, these moves reinforce Musk’s broader vision of combining AI, energy, and space technology to support humanity’s multi-planetary future.