SpaceX CEO Elon Musk attends the World Economic Forum in Davos, Switzerland on January 22, 2026.
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SpaceX CEO Elon Musk announced Wednesday that the company’s artificial intelligence venture xAI has undergone a reorganization that “requires a break with some people.”
In a post on X, Musk said the review was done “to improve the speed of execution.” He did not say which employees had been cut as a result of the restructuring or which employees had left the company voluntarily.
“We’re hiring aggressively,” Musk added.
Earlier this week, xAI co-founders Jimmy Barr and Tony Wu announced their retirement, following the earlier departures of several other founding members, including Igor Babushkin, Kyle Kosik, Christian Szegedy, and Greg Yang.
Last week, Musk announced a record all-stock deal in which aerospace and defense giant SpaceX would acquire xAI, the owner and operator of the social network X and developer of the struggling AI chatbot and image generator Grok.
The deal values the combined SpaceX at $1 trillion and xAI at $250 billion, according to documents seen by CNBC. Musk previously used xAI to acquire X (formerly Twitter) in a separate all-stock deal announced in March 2025.
The co-founder’s departure and this week’s reorganization come as SpaceX prepares to go public later this year and xAI faces regulatory scrutiny in multiple jurisdictions in Europe, Asia and the United States.
Law enforcement authorities are investigating whether xAI violated local regulations after Grok enabled the mass creation and distribution of non-consensual, explicit images, colloquially known as deepfake pornography. Images are based on photos of real people, including children.
Musk launched xAI in 2023 with 11 others to take on OpenAI and Google. The company’s stated goal was to “understand the true nature of the universe,” according to its website at the time.
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