The losses are not that bad while advertising is down, Elon was able to drastically reduce costs and headcount. X also added subscription revenue. A major thing that people forget is that X owns 25% of XAI. X content has enabled better realtime performance for XAI Grok 2.

If XAI hits the planned release of Grok 3 by the end of this year and X releases X payments then both companies should be comfortably valued at over $80 billion by the end of 2024. X would then be able to raise funds at a valuation about double what Elon Musk paid.

XAI was valued at $24 billion after raising $6 billion in May, 2024. However, XAI has released the Grok 2 AI model that is very close to the performance of OpenAI's top GPT 4o (Omni) and the latest Gemini model from Google.

XAI has bought 100,000 Nvidia H100 chips and is setting up the expanded AI data center to train, Grok 3, a GPT 5 class model by the end of this year.

OpenAI is valued at $86 billion based upon its last funding by Microsoft. OpenAI's Revenue is on track for an annualized revenue of $3.4 billion in 2024. It is unclear if this estimate is still accurate with the release of the open source Meta Llama 3 models. Microsoft is trying to making billions and perhaps $10 billion be adding OpenAI GPT4 to its products.

XAI Grok is incorporated into X Premium subscription service. XAI Grok will be integrated into Tesla cars and the Teslabot.

X owns 25% of XAI. XAI needed to train on the text in X. If XAI valuation increases towards OpenAI's $86 billion with the release of Grok 3 then X would own $21.5 billion of XAI. The previous XAI valuation in May for X's 25% of XAI was $6 billion. The release of Grok 2 likely makes XAI worth at least $48 billion. X's shares would be worth $12 billion.

X is getting about $120 million per year in subscription revenue and has far lower ad revenue from before Elon Musk's purchase at a price of $44 billion.