Musk Moves $2B from SpaceX to xAI: Can Grok Compete with ChatGPT?
Elevate Your Investing Strategy:
Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week.
Musk has a long track record of moving capital, talent, and hardware across his empire, borrowing from SpaceX to fund Tesla (TSLA) in its early days. He used SpaceX infrastructure to launch The Boring Company. And in 2022, a $1 billion loan from SpaceX helped finance his acquisition of Twitter, now known as X. That money was paid back quickly, but the playbook is the same: leverage one company to speed up another.
Musk Links his AI Startup to SpaceX and Starlink
With this latest move, Musk is now aligning xAI with Starlink, SpaceX's satellite internet service, where Grok powers customer support. He also says Grok will eventually help drive Tesla's Optimus humanoid robot. For investors, this is a familiar pattern: What happens in one Musk company tends to spill over into the others.
However, Grok still trails ChatGPT from OpenAI and Gemini from Alphabet (GOOG). Since launching Grok-1 in late 2023, xAI has pushed out multiple upgrades. Grok-4, released this month, includes advanced language, vision, and coding capabilities. Musk claims it's the 'smartest AI in the world,' but real-world traction is limited. Recent antisemitic controversy over Grok's outputs on X highlights the model's moderation challenges.
Meanwhile, OpenAI continues to dominate the space with GPT-4o, and Google's Gemini has shown steady improvements. These models have more users, developer support, and brand trust. Even if Grok is technically catching up, the gap in adoption and integration remains wide.
'We Have Plenty of Capital'
SpaceX had more than $3 billion in cash recently, according to reports. But it's also spending billions on its Starship rocket, which has faced setbacks. Tapping that balance sheet to back xAI adds exposure, and possibly reward, to SpaceX's risk profile. xAI raised another $5 billion in debt alongside the equity, and Musk denies reports that it is seeking a $200 billion valuation. 'We have plenty of capital,' he said in response.
Whether Grok ever rivals ChatGPT remains to be seen. But one thing is clear: Musk isn't waiting for outside approval. He's financing his AI vision from within.
Is Tesla a Buy, Sell, or Hold?
Back to Musk's publicly traded company, Tesla, which currently boasts a Hold consensus rating from Wall Street analysts based on 36 reviews. The average price target stands at $295.80, suggesting a potential downside of 5.65%.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
35 minutes ago
- Yahoo
SpaceX Project Kuiper rocket launch in Florida: What time is liftoff from Cape Canaveral?
A late-night rocket launch from Florida is on the horizon — and if you're on the Space Coast, it'll be a sight to see. A SpaceX Falcon 9 rocket will potentially carry the third batch of Amazon satellites into low-Earth orbit. Amazon founder Jeff Bezos launched Project Kuiper, a global network of satellites, to compete with SpaceX CEO-billionaire Elon Musk and Starlink satellites. The first two launches of the Amazon Project Kuiper production satellites were courtesy of a United Launch Alliance Atlas V rocket from Cape Canaveral. Online, the mission has been called the "Amazon rocket launch" or "the Amazon rocket launch from Florida,' but it's accurate to call it the Amazon satellite rocket launch. Rockets here launch from NASA's Kennedy Space Center or nearby Cape Canaveral Space Force Station. Weather permitting and depending on cloud cover, a rocket launch from Florida's Space Coast could be visible as far north as Jacksonville Beach and Daytona Beach to as far south as Fort Pierce and West Palm Beach. When there's a launch window in the middle of the night or very early morning, there's an opportunity for unique photos — the rocket lights up the dark sky and the contrail after makes for a great photo. Below is more information about the SpaceX rocket launch in Florida and suggestions on where to watch them from here. Is there a launch today? Is there a launch today? Upcoming SpaceX, NASA, ULA rocket launch schedule at Cape Canaveral For questions or comments, email FLORIDA TODAY Space Reporter Rick Neale at rneale@ or Space Reporter Brooke Edwards at bedwards@ For more space news from the USA TODAY Network, visit Mission: SpaceX will launch a Falcon 9 rocket and deploy a payload of Amazon Project Kuiper internet-beaming satellites into low-Earth orbit, the Space Coast Office of Tourism reported. Launch window: 2:10 a.m. to 3:38 a.m. ET Wednesday, July 16, 2025 Launch location: Launch Complex 40 at Cape Canaveral Space Force Station in Cape Canaveral, Florida Sonic booms for Space Coast of Florida (Merritt Island, Melbourne area): No Live coverage starts 90 minutes before liftoff at : You can watch live rocket launch coverage from USA TODAY Network's Space Team, which consists of FLORIDA TODAY space reporters Rick Neale and Brooke Edwards and visuals journalists Craig Bailey, Malcolm Denemark and Tim Shortt. Our Space Team will provide up-to-the-minute updates in a mobile-friendly live blog, complete with a countdown clock, at starting 90 minutes before liftoff. You can download the free FLORIDA TODAY app, which is available in the App Store or Google Play, or type into your browser. Shown is the National Weather Service-Melbourne radar, which shows conditions in real-time for the Space Coast, Brevard County, Orlando and other parts of Florida. The current date and time show up on the bottom right of this radar embed; otherwise, you may need to clear your cache. Pretty much anywhere in Brevard, you'll get a view of the rocket launch − in certain areas, you can get an amazing view of SpaceX rocket boosters returning to the pads. The best view to watch a rocket launch from the Space Coast is along the beach. However, visibility will depend on weather conditions and people should make sure not to block traffic or rights of way on bridges and to follow posted rules at beaches. If you are viewing the launch along the Indian River in Titusville from Space View Park or Parrish Park, look east directly across the river. If you are farther south along the Indian River, look northeast. Playalinda Beach or Canaveral National Seashore is the closest spot to view liftoff because it is almost parallel to Launch Pad 39A. On the beach, look south along the coastline, (you can even see the pad from some spots). Some hotspots to check out: Sebastian Inlet Park, 9700 S. State Road A1A, Melbourne Beach (there is a cost to enter) Jetty Park Beach and Pier, 400 Jetty Park Road, Port Canaveral. Note, there's a charge to park. Playalinda Beach, 1000 Playalinda Beach Road, Canaveral National Seashore. Note, there's a charge to park, and access to Canaveral National Seashore isn't always granted depending on capacity and time of day. Max Brewer Bridge and Parrish Park, 1 A. Max Brewer Memorial Parkway, Titusville. Note, parking is available on both sides of Max Brewer Bridge. Space View Park, 8 Broad St., Titusville Sand Point Park, 10 E. Max Brewer Causeway, Titusville Rotary Riverfront Park, 4141 S. Washington Ave., Titusville Riverfront Park at Cocoa Village, 401 Riveredge Blvd., Cocoa (just before State Road 520 Causeway) Cocoa Village, near the parks and shops or near the docks Various parks on Merritt Island Rotary Park, 1899 S. Courtenay Parkway, Merritt Island Kiwanis Park on Kiwanis Island Park Road on Merritt Island Port Canaveral, with ships from Disney Cruise Line, Carnival Cruise Line, Royal Caribbean at port Alan Shepard Park, 299 E. Cocoa Beach Causeway, Cocoa Beach. Note, there could be parking costs. Cocoa Beach Pier, 401 Meade Ave. Parking fee varies. Lori Wilson Park, 1400 N. Atlantic Ave., Cocoa Beach. Lori Wilson Park has a dog park, by the way. Sidney Fischer Park, 2200 N. Atlantic Ave., Cocoa Beach. Note, there could be parking costs. Downtown Cocoa Beach, along Minutemen Causeway Tables Beach, 197 SR A1A, Satellite Beach The Tides on SR A1A in Satellite Beach Various parks, including the Pelican Beach Clubhouse, in Satellite Beach Pineda Causeway Eau Gallie Causeway Front Street Park near Melbourne (U.S. 192) Causeway and U.S. 1 in Melbourne Indialantic boardwalk at Melbourne Causeway and SR A1A Paradise Beach Park, aka Howard Futch Park, 2301 SR A1A, Melbourne (this is a beachside park) Sangalang is a lead digital producer for USA TODAY Network. Follow her on Twitter or Instagram at @byjensangalang. Support local journalism. Consider subscribing to a Florida newspaper. This article originally appeared on Florida Today: SpaceX Amazon satellite rocket launch in Florida: What time is liftoff
Yahoo
an hour ago
- Yahoo
Musk's xAI plans funding round targeting up to $200bn
Elon Musk's AI company, xAI, is reportedly targeting a valuation between $170bn and $200bn in its next funding round. This potential valuation comes amidst discussions with Saudi Arabia's Public Investment Fund (PIF), according to sources cited by the Financial Times. The sovereign wealth fund holds an indirect stake in xAI through Kingdom Holdings' $800m investment. However, the discussions are at a preliminary stage and subject to adjustments. Despite these reports, Musk stated on the social media platform X that xAI is not actively seeking additional funding. Musk asserted that the company has plenty of capital. Meanwhile, a fresh report has emerged that another venture of Musk, SpaceX, is planning to invest $2bn in xAI. This is part of a $5bn equity funding round, according to The Wall Street Journal. This move further intertwines Musk's ventures, including SpaceX, Tesla, and X. In June 2025, Morgan Stanley announced that xAI secured $5bn through debt issuance, accompanied by an equivalent amount in a strategic equity investment. These funds are intended to bolster xAI's AI infrastructure through expanded data centres amid increasing competition in the sector. Earlier in 2025, xAI acquired Musk's social media platform X, formerly known as Twitter. The acquisition X at $33bn while pegging xAI at $80bn. This merger enabled the integration of xAI's Grok chatbot into various applications such as Starlink support and potentially into Tesla's Optimus robots in the future. In late May, xAI reportedly forged a partnership with Telegram to incorporate the Grok chatbot across all the apps of the messaging service. Under this agreement, xAI will compensate Telegram with $300m through cash and equity while sharing half of any subscription revenue generated via the platform. Overall, financial projections from Morgan Stanley suggest that xAI could achieve over $13bn in annual earnings by 2029, as per a report in Bloomberg News. By the end of 2025, the AI company is anticipated to generate $1bn in gross revenue while allocating $18bn for investments in data centre expansion. "Musk's xAI plans funding round targeting up to $200bn" was originally created and published by Verdict, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
an hour ago
- Yahoo
1 Top Cryptocurrency to Buy Before It Soars 3,260%, According to Cathie Wood of ARK Invest
Cathie Wood, CEO of ARK Invest, predicts Bitcoin could reach $3.8 million by 2030, driven by institutional and corporate adoption. The trend of corporations adopting Bitcoin as a reserve asset is growing, led by Strategy, GameStop, and Trump Media. 10 stocks we like better than Bitcoin › Cathie Wood, the head of the technology-focused investment firm ARK Invest, doesn't shy away from making big bets and bold predictions. She is a vocal backer of Tesla, making it clear that she sees its robotaxi and robotics businesses changing the world -- and making trillions of dollars doing it. Her predictions in the crypto market are just as bold, none more so than her Bitcoin (CRYPTO: BTC) price target. Wood is a huge proponent of the digital coin -- and crypto more generally -- and was one of the more influential figures in getting spot Bitcoin exchange-traded funds approved. During that process, she said that her firm believed that the token could be worth as much as $1.5 million by the end of the decade. (Her base-case target was $600,000, still not a bad return.) More recently, she said that she believes that the upper target could be as high as $3.8 million by 2030. That's a roughly 3,260% return from today's price and represents a more than a 100% annual return. The upper boundary of her prediction is substantial, to say the least. So, where does she see this price appreciation coming from? There are a few catalysts, but her main argument is that increased institutional adoption will drive the bulk of it. Her math is reasonably simple: If institutional investors allocate, on average, 5% of their portfolios, it would be enough for Bitcoin to reach those enormous heights. That may not seem like much, but 5% of all institutional money is a huge amount of capital, and it represents a significant uptick from where we are now. While it's true we are trending in that direction, there is a long way to go. An interesting trend lately has been the corporate adoption of Bitcoin as a reserve asset. This was pioneered by Michael Saylor and his aptly named Strategy (formerly MicroStrategy). The company has pursued an extremely aggressive purchasing program and now sits on 592,100 bitcoins, valued at almost $70 billion. Other high-profile names have since followed suit, including GameStop and Trump Media & Technology Group. Strategy's strategy is a bold one, to say the least. The company's core software business has been delivering consistent losses for some time. It is using a mix of debt and private sales of preferred shares to finance its huge buying spree. Its most recent sale of nearly $1 billion in preferred stock (which comes with a 10% dividend) will cost the company roughly $100 million a year. That's a big expense considering its total revenue for 2024 was just $463 million. Remember: It's already operating at a loss. I am not a fan of the tactic, and I would not recommend investing in Strategy or companies like it that are relying on buying the crypto as their core business model. I think it's reckless. Still, these companies may be an extreme vanguard. We could soon see public companies choose to hold more-modest amounts of Bitcoin as a treasury asset. Cathie Wood's predictions for Bitcoin's upside are certainly headline-grabbing. Investors would do well to take them -- and others like them -- with a pretty hefty grain of salt. There's no denying the upside potential if widespread institutional and corporate adoption accelerates. However, the reality is that most of the larger institutions (where the lion's share of all capital is managed) will remain cautious, and aggressive corporate balance-sheet allocation from public companies is likely to remain a relatively niche strategy on the whole. Still, I think Bitcoin will continue to grow, just not at the pace Wood suggests. Investors who are nearing retirement may want to avoid crypto altogether, but for most investors, Bitcoin is a solid addition to a well-diversified portfolio. Before you buy stock in Bitcoin, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Bitcoin wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $671,477!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,010,880!* Now, it's worth noting Stock Advisor's total average return is 1,047% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of July 7, 2025 Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin and Tesla. The Motley Fool has a disclosure policy. 1 Top Cryptocurrency to Buy Before It Soars 3,260%, According to Cathie Wood of ARK Invest was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
