Elon Musk’s xAI Is Becoming a Cloud Firm

Is xAI the next CoreWeave? SpaceX’s announcement on Wednesday that its xAI unit had struck a deal to supply computing capacity to Anthropic comes a couple of weeks after xAI struck a similar deal with AI coding startup Cursor. Last we checked, AI firms with leading models need all the computing capacity they can get, which means they’re constantly looking for capacity from others. Renting out their own capacity is unheard of for most of them. That’s precisely why Anthropic is doing this deal. So what’s xAI’s excuse? The simplest explanation, as they say, is usually the right one: xAI doesn’t need all the capacity it has built because its Grok model isn’t getting much traction. Going into business as a cloud operator is at least a way for xAI (which Musk says is now called SpaceXAI ) to make some money.

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