Elon Musk’s artificial intelligence company, xAI, is preparing to raise more funds from investors in a new deal that could value the startup between $170 billion and $200 billion, according to the Financial Times. This is more than ten times its valuation from early last year and would be xAI’s third major funding move in less than two months, following a $10 billion raise in July through loans and cash, and a $300 million secondary stock sale in June.

Don’t Miss TipRanks’ Half-Year Sale

This fundraising round comes shortly after the company experienced some setbacks. For starters, xAI launched the fourth version of its Grok chatbot, which operates on Musk’s social media platform, X. However, the rollout faced backlash after Grok posted comments praising Adolf Hitler and spreading antisemitic content. Unsurprisingly, xAI responded by promising to remove hate speech. Furthermore, X CEO Linda Yaccarino stepped down from her role in a move that took many by surprise.

Nevertheless, Musk’s private companies continue to rise sharply in value even as Tesla shares have dropped nearly 20% this year. Indeed, xAI acquired X in an all-stock deal in March that valued the combined firm at $113 billion, and this could grow to $245 billion if the latest fundraising succeeds. At the same time, SpaceX is planning to sell about $1 billion in shares at a $400 billion valuation, which would be a jump from the recent valuation of $350 billion. Interestingly, insiders suggest that Saudi Arabia’s Public Investment Fund is expected to play a major role in the upcoming deal.

What Is the Prediction for Tesla Stock?

When it comes to Elon Musk’s companies, most of them are privately held. However, retail investors can invest in his most popular company, Tesla (TSLA). Turning to Wall Street, analysts have a Hold consensus rating on TSLA stock based on 14 Buys, 13 Holds, and nine Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average TSLA price target of $295.80 per share implies 5.7% downside risk.

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