Milken Conference 2024 Global Conference Sessions

Elon Musk, Chief Executive Officer of SpaceX and Tesla and owner of X looks on during the Milken Conference 2024 Global Conference Sessions at The Beverly Hilton in Beverly Hills, California, U.S., May 6, 2024. REUTERS/David Swanson/File Photo Purchase Licensing Rights, opens new tab

SAN FRANCISCO, July 23 (Reuters) – Tesla (TSLA.O), opens new tab CEO Elon Musk has launched a poll asking users on social media platform X whether the electric carmaker should invest $5 billion in his artificial intelligence startup xAI – with early votes showing most in favour of the move.
“Board approval & shareholder vote are needed, so this is just to test the waters,” Musk said of the poll which came on the heels of Tesla posting its lowest profit margin in five years on price cuts and increased spending on AI projects.

During Tesla’s earning conference call, Musk said xAI would be “helpful in advancing full self-driving and in building up the new Tesla data center,” adding that there are opportunities to integrate xAI’s chatbot, Grok, with Tesla’s software.
Nearly 3 hours after the poll was posted, roughly 386,000 people had participated with 70% voting in favour of the investment.
Tesla did not immediately respond to a Reuters request for comment, while xAI could not be reached for comment.

Musk, the world’s richest person, launched xAI last year, hoping to build an alternative to ChatGPT. The startup raised $6 billion in a series B funding in May, attaining a post-money valuation of $24 billion. Backers include Andreessen Horowitz and Sequoia Capital.
Musk has previously said that he plans for a quarter of xAI, opens new tab to be owned by investors in X, formerly known as Twitter, which he bought for $44 billion although the social media firm’s value has plunged since then.
On the earnings call, Musk also dismissed concerns that he may be diverting resources from Tesla to some of his other companies.
In June, CNBC reported that he had ordered Nvidia (NVDA.O), opens new tab to ship thousands of AI chips destined for Tesla to xAI and X. Musk said Tesla’s data center was full and there was no place to put the chips.
Musk is a frequent poller on X. In 2021, he asked Twitter users about whether he should sell 10% of his Tesla stake and commenced selling shares just days after the poll.

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