Musk says he’s looking to put ‘proper value’ on xAI during investor call, sources say

Elon Musk is looking to put “proper value” on his artificial intelligence startup xAI, sources told CNBC’s David Faber.

The comments came during a call with xAI investors last week, sources familiar with the matter told Faber. While the Tesla CEO didn’t explicitly address an upcoming funding round, the sources interpreted the comments as a sign that xAI is getting set up for a significant capital raise in the near future.

CNBC was unable to confirm that the company is actively looking at a raise.

The sources also said the company discussed revenue at a potential run rate of $1 billion or more on the call.

The raise would mark another significant milestone for xAI just months after CNBC reported that the company was raising up to $6 billion at a $50 billion valuation to buy up 100,000 Nvidia chips. The funding was reportedly a combination of $5 billion from Middle East sovereign funds and $1 billion from other investors.

Musk announced the AI startup in July 2023. At the time, the company said its goal was to “understand the true nature of the universe.” xAI launched a chatbot called Grok last year, which it claimed at the time had debuted with two months of training and real-time internet knowledge. xAI is looking to use the chatbot to compete against other AI chatbots, including Anthropic’s Claude and ChatGPT maker OpenAI, which Musk helped launch before leaving the project in 2018.

In March, Musk said that the startup had merged with social media platform X in an all-stock deal valuing the combined entity at $80 billion. Musk said that X had been valued at $33 billion.

“xAI and X’s futures are intertwined,” Musk wrote in a post on X announcing the merger. “Today, we officially take the step to combine the data, models, compute, distribution and talent.”

Since President Donald Trump’s inauguration, Musk has focused much of his time on the Department of Government Efficiency, leaving questions about the stability of his companies as Tesla shares have fallen over 40% this year. His presence on the call could be a signal that he’s re-focusing on his business entities.

WATCH: Elon Musk held call with current xAI investors, sources say