On May 6 (local time), Elon Musk made a surprising announcement: xAI would be integrated into SpaceX and rebranded as SpaceXAI. At the same time, SpaceX made the strategic decision to lease the entire Colossus 1 data center to Anthropic—a company Musk had publicly criticized just three months earlier, calling it "human-averse and evil." This move comes just 33 days before SpaceX is set to embark on its IPO roadshow, scheduled to begin on June 8.

Signs of xAI's impending dissolution had been evident for some time. Over the past three months, its operations were gradually wound down, paving the way for the Colossus 1 data center to be repurposed as a computational asset under SpaceX's umbrella. Following the merger, xAI will no longer be independently valued. Meanwhile, the newly formed SpaceXAI lacks direct market comparables, a strategic maneuver that could help inflate SpaceX's overall valuation.

For Anthropic, the deal provides a much-needed boost: 300 megawatts of computational power to support its operations, along with adjustments to its Claude Code quotas. It could be argued that the dissolution of xAI was a prerequisite for this agreement. Under SpaceXAI, the AI business will shift its focus. Instead of developing cutting-edge, next-generation models, it will prioritize scaling computational resources to enhance SpaceX's valuation story—a move that aligns with broader corporate strategies in the tech industry.