Catenaa, Wednesday, October 15, 2025-Elon Musk’s AI startup xAI is reportedly expanding its ongoing funding round to $20 billion, with Nvidia expected to invest up to $2 billion, Bloomberg News cited sources familiar with the matter.
The financing, a combination of equity and debt, will be tied to Nvidia graphics processing units planned for xAI’s Colossus 2 data center.
The proposed capital raise would allocate roughly $7.5 billion to equity and up to $12.5 billion to debt, structured through a special purpose vehicle intended to purchase Nvidia processors.
The move comes amid intensifying competition in AI development and Musk’s effort to scale xAI as an alternative to OpenAI’s ChatGPT.
Nvidia has not commented on the planned investment, and xAI did not immediately respond to requests for confirmation.
In September, Musk denied reports that xAI was raising $10 billion at a $200 billion post-money valuation, stating that capital would be raised in coming months but not immediately.
Launched in July 2023, xAI has sought to position itself as a high-performance AI developer, aiming to leverage Nvidia’s GPUs to build advanced AI infrastructure.
Analysts say the potential $20 billion raise signals growing investor confidence in Musk’s AI ambitions and highlights the critical role of specialized AI hardware in powering next-generation models.
