Musk’s xAI burning through $1B a Month as costs pile up, Bloomberg reports

Elon Musk’s artificial intelligence startup xAI is trying to raise $9.3B in debt and equity, but even before the money is in the bank the company has plans to spend more than half of it in just the next three months, according to deal terms shared with investors, Bloomberg’s Carmen Arroyo and Jill R Shah report. The rate at which the company is raising funds and tearing through cash offers a stark illustration of the unprecedented financial demands of the artificial intelligence industry, and the relatively meager revenues it is bringing in so far, at least when it comes to xAI. Musk’s startup, which is responsible for the AI-powered chatbot Grok, expects to burn through about $13B over the course of 2025, or more than $1B each month, as reflected in the company’s levered cash flow, according to the people familiar with the deal terms.