June 19 - Bloomberg published a blog post yesterday, June 18, reporting that Musk'sArtificial Intelligence Companies xA In order to develop Grok and other advanced AI models, investing heavily in things like server clusters and specialized chips.Burning $1 billion a month (note: current exchange rate is about 7.188 billion yuan).
Bloomberg estimates that xAI will burn $13 billion in 2025 for the full year, and the company's estimated revenue for this year is only $500 million, which is far less than the rate of spending growth, although it is expected to increase to $2 billion in 2026.
xAI's funding strategy is characterized by urgency. Since its founding in 2023, the company has raised $14 billion through equity financing, but with only $4 billion in cash remaining as of Q1 2025, it will bottom out in Q2 at its current burn rate.
1AI previously reported that xAI is trying to raise $9.3 billion through debt and equity in order to close its funding gap, including $4.3 billion in new equity financing and $5 billion in debt that Morgan Stanley helped raise.
Compared to other AI giants, xAI's revenue growth is lagging significantly. OpenAI, for example, is expected to generate $12.7 billion in revenue this year, compared to $500 million for xAI. But Musk's team is betting on its own strengths: access to massive amounts of free training data through the X platform, rather than buying datasets; and direct control of arithmetic resources, rather than leasing chips.