xAI Secures $10 Billion in New Financing to Power Grok and Data Center Expansion

xAI has locked in $10 billion in fresh financing to scale its AI infrastructure and expand its flagship Grok platform. The raise includes $5 billion in secured notes and term loans led by Morgan Stanley, along with a separate $5 billion strategic equity investment. According to Morgan Stanley, the transaction was oversubscribed and attracted global debt investors, reflecting strong confidence in xAI’s long-term vision. The combined structure reduces xAI’s overall cost of capital while providing deep liquidity for continued expansion. Proceeds will support the buildout of one of the world’s largest AI-focused data centers and further development of Grok, xAI’s conversational AI product that competes with OpenAI’s ChatGPT and Anthropic’s Claude. This move significantly boosts xAI’s war chest, which totaled $6 billion before this round. xAI’s backers now include a high-profile roster of institutional and strategic investors, including Nvidia, Sequoia Capital, Blackrock, Andreessen Horowitz, and AMD. The funding signals rising investor appetite for Musk’s AI venture, which positions itself as a mission-driven alternative to other foundation model labs. As the competitive race for compute and model dominance intensifies, xAI’s capital haul gives it the financial runway to scale aggressively across infrastructure and model innovation.