The company is currently building a large AI computing cluster in Memphis, Tennessee, in an effort to build the computational capacity necessary for training advanced models.
xAI’s latest rumored fundraising follows a recent $10 billion debt and equity round, completed weeks earlier, at an approximate $150 billion valuation. The company previously raised $6 billion in December to fund AI development, demonstrating rapid capital consumption typical of large-scale AI operations.
The funding pursuit occurs amid persistent issues with xAI’s Grok chatbot, which has generated controversy through problematic responses.
Incidents include the chatbot praising Adolf Hitler, attacking Jewish people, and providing unrelated comments about “white genocide” and South Africa in response to user queries.
According to the report, Grok also lags behind industry leaders Anthropic’s Claude and OpenAI’s GPT models in capabilities and user adoption.
The funding round highlights the AI industry’s capital-intensive nature as companies compete for talent, computational resources, and market position in the rapidly evolving artificial intelligence landscape.
