xAI "burns" $1 billion every month and the cost keeps rising.

xAI Burns Through $1 Billion a Month as Costs Keep Rising

According to people familiar with the company's financial situation, Elon Musk's artificial intelligence startup xAI burns through $1 billion a month as the cost of building its advanced AI models far exceeds its limited revenue. The company's "money-burning" pace vividly illustrates the unprecedented financial demands of the AI industry, especially for xAI, where revenue monetization has been sluggish. People familiar with the terms of the deal said that to bridge the funding gap, Musk's startup is currently trying to raise $9.3 billion through debt and equity financing. Even before the funds are deposited in the bank, the company plans to spend more than half of it within the next three months. According to details shared with investors, during 2025, xAI, which is in charge of the AI chatbot Grok, is expected to consume about $13 billion in funds, as reflected in the company's levered free cash flow.

—— Bloomberg

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