SpaceX has made a groundbreaking acquisition by taking over xAI, the artificial intelligence startup founded by Elon Musk. This strategic move aims to merge rockets, satellite internet, direct-to-mobile connectivity, and AI into a single, vertically integrated platform.

In a company memo, Musk highlights the limitations in AI scaling due to the power and cooling constraints of traditional terrestrial data centers. He proposes space as the ultimate solution, envisioning orbital data centers fueled by continuous solar energy.

The plan involves utilizing Starship to transport significantly larger payloads to orbit compared to existing systems. This capability would facilitate a massive expansion of satellite infrastructure, leading to a substantial increase in computing capacity over time.

This development comes at a time when SpaceX is considering a high-profile public listing. Reports suggest that the company is contemplating an IPO in mid-June, with potential proceeds of up to $50 billion and a valuation of around $1.5 trillion, although official confirmation is pending.

Recent discussions have also surfaced regarding a possible merger between SpaceX and xAI ahead of the IPO. Some sources estimate a combined valuation closer to $1.25 trillion, indicating the significant potential of this collaboration.

Additionally, a recent update to the Starlink privacy policy has attracted attention. The revised policy allows for the use of customer data in training AI models unless users actively opt out. This change could have far-reaching implications as SpaceX and xAI integrate their systems and data pipelines.