According to Bloomberg News, Elon Musk's AI venture, xAI, is reportedly in talks to raise an additional$4.3 billion through equity investment. However, this would be in addition to the$5 billion debt sale already underway, with commitments due by Tuesday.

Since founding in 2023, xAI has secured$14 billion through previous equity fundraising rounds. The report noted that the new capital injection is needed, partly because the company has spent most of the funding already raised.

Running large-scale AI systems like xAI's Grok chatbot is expensive, requiring high-end hardware, vast computational resources, and top-tier AI talent in an increasingly competitive market. To help offset costs, xAI may also receive a$650 million rebate from one of its manufacturing partners.

The company acquired the social media platform X (formerly Twitter) earlier this year and was valued at around$80 billion at the end of Q1 2025-up from$51 billion at the close of 2024.

xAI's funding push comes amid aggressive moves by rivals. In March, OpenAI-Musk's former company-announced plans to raise$40 billion at a$300 billion valuation, led by SoftBank.

Musk, who co-founded OpenAI in 2015 but left the board in 2018, previously made a$97.4 billion takeover offer for the company. That bid was rejected, and Musk has since taken legal action to block OpenAI's transition from a non-profit to a for-profit entity.