Elon Musk's xAI racks up huge losses while chasing big AI dreams

Business Jan 11, 2026

Elon Musk's AI startup, xAI, is burning through cash fast—losing nearly $1 billion in Q1 and $1.46 billion in Q3 of 2025.
In just nine months last year, the company spent about $7.8 billion, or almost $1 billion every month.

All-in on tech and talent

xAI's massive losses come from pouring money into computing power, data centers, and hiring top engineers to build advanced AI models.
Leaders say they'll "continue spending aggressively," especially as they work on a "self-sufficient AI" for Tesla's Optimus robots.

The $20 billion data center bet

On top of everything else, xAI just announced a gigantic $20 billion data center project in Mississippi—the biggest private investment ever in the state.
This bold move marks a significant shift in tech investment for the state.