xAI lands $20B funding round supported by Nvidia and Cisco

Elon Musk’s xAI finalized its $20 billion Series E funding round on Wednesday, with major investors including Nvidia and Cisco Investments. The firm stated that the funding round exceeded the $15 billion it had previously targeted as investors poured millions of dollars into the initiative.

Several investors also participated in the initiative, including Valor Equity Partners, Fidelity Management & Research Company, Stepstone Group, Baron Capital Group, Qatar Investment Authority, MGX, and others. xAI said its investors continue to support the firm in advancing its compute infrastructure, which aims to build the largest GPU globally.

xAI seeks to enable rapid development and deployment of its AI products

Musk on Tuesday congratulated the xAI team on its latest feat, and also thanked investors for trusting in his company. He added that the firm is seeking to recruit AI Finance Tutors to train Grok.

xAI also revealed that it’s planning to hire mission-oriented individuals. The firm wants the team to focus on making a transformational impact on the future of humanity.

Musk’s artificial intelligence startup said the funding will enable the rapid development and deployment of its AI products. xAI also believes the funding will fuel groundbreaking research and advance the company’s mission: Understanding the Universe.

“It’s worth asking whether X data, used as Grok model training data, could ultimately produce better models than the data that other language model providers like OpenAI are training on.”

-Joni Pirovich, Founder and CEO of Crystal aOS.

Pirovich argued that the funding round proves that major backers are willing to bet on xAI. He also believes that investors want exposure to the upside if the AI company can funnel market share from OpenAI and increase consumer and enterprise use of Grok models.

Nvidia CEO Jensen Huang stated in October that his company was interested in xAI’s latest funding round. He expressed his excitement in the initiative, saying he wished he could even offer more money to the company, its founders, and the owner. The techpreneur maintained that people should want to be part of almost everything that Musk is involved in.

xAI sees breakthrough momentum in 2025

xAI also revealed that it saw breakthrough momentum in 2025, constructing several massive data centers in the U.S. The firm pointed to the growth of its Colossus I and II data centers, which made more than one million Nvidia H100 GPU equivalents by year-end.

Musk’s firm added that it has advanced reinforcement learning training in its Grok 4 Series, powered by Colossus. xAI revealed that the initiative refines Grok’s intelligence, reasoning, and agency using pretraining-scale compute.

xAI maintained that its advanced Grok Voice agent delivers low-latency speech in multiple languages. The agent also enables tool calling and real-time access, which serves users on the Grok mobile app and in Tesla vehicles.

Musk’s artificial intelligence startup also reported that it reached approximately 600 million monthly active users across the X and Grok apps in 2025. xAI said in the announcement that Grok on X, together with its image and video generation models, Grok Imagine, also advanced last year. 

xAI acknowledged that it’s currently training its Grok 5 model. The firm stated that the model is focused on launching innovative new consumer and enterprise products. According to the announcement, the Grok 5 model aims to harness the power of Grok, Colossus, and X to transform people’s lives.

Cryptopolitan previously reported that xAI’s recent funding round pushed the company’s valuation up to around $230 billion in total. Bloomberg reported in June that xAI was close to generating approximately $500 million in revenue last year. According to the report, the AI startup was projected to generate upwards of $2 billion in 2026 via partnerships and AI expansion.

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