Elon Musk’s xAI is facing significant leadership changes as two co-founders recently departed, raising concerns about the company’s stability amid ambitious plans and regulatory scrutiny.
Elon Musk’s xAI is currently navigating a challenging period, marked by the recent departures of two co-founders within just two days. This leadership churn comes at a time when expectations for the company are exceptionally high, as Musk continues to promote bold ambitions for the future of artificial intelligence.
In the latest development, influential AI researcher Jimmy Ba announced his exit from xAI on Tuesday. In a post on X, Ba expressed gratitude for his early involvement, stating he was “grateful to have helped cofound at the start.” His departure follows that of fellow co-founder Tony Wu, who revealed his resignation just one day earlier.
The timing of these resignations is particularly notable, as they occurred shortly after xAI was merged with Musk’s aerospace company, SpaceX, earlier this month. This merger is reportedly part of SpaceX’s preparations for a public listing later this year.
Ba, who is a professor at the University of Toronto, played a significant role in developing research that informed xAI’s Grok 4 models. His exit adds to a growing list of senior departures from the startup, which has now seen six of its original twelve founders leave, five of them within the past year.
Other co-founders, including Igor Babuschkin, Kyle Kosic, and Christian Szegedy, have also exited the company. Additionally, Greg Yang announced last month that he would be scaling back his involvement to focus on his health, specifically dealing with Lyme disease.
The merger between xAI and SpaceX was structured as an all-stock transaction, valuing SpaceX at $1 trillion and xAI at $250 billion, according to documents cited by CNBC. Earlier, in March 2025, Musk utilized xAI in a separate all-stock deal to acquire his social media platform, X.
These leadership changes come amid increasing regulatory scrutiny for xAI in various regions, including Europe, Asia, and the United States. Investigations were initiated after xAI’s Grok chatbot and image generation tools were found to facilitate the large-scale creation and distribution of non-consensual explicit content, commonly referred to as deepfake pornography. This material included images of real individuals, including minors, raising alarms among regulators across multiple jurisdictions.
Musk founded xAI in 2023 with a team of 11 others, positioning the company as a competitor to OpenAI and Google in the rapidly evolving AI landscape. At its inception, xAI stated its mission was to “understand the true nature of the universe,” setting an ambitious tone for what Musk envisioned as a transformative venture.
In response to the recent departures, Musk quickly convened an all-hands meeting with xAI staff on Tuesday night. This meeting aimed to reset the narrative and outline a sweeping vision for the company’s future. According to reports from The New York Times, Musk told employees that xAI would eventually require a manufacturing base on the moon. He proposed the idea of building AI-powered satellites there and launching them into space using a massive catapult. “You have to go to the moon,” Musk stated, as reported by The New York Times.
Musk suggested that establishing a presence on the moon would provide xAI with access to computing capacity far exceeding that of its competitors. He implied that such advancements could unlock forms of intelligence that are currently difficult to conceptualize. “It’s difficult to imagine what an intelligence of that scale would think about,” he added, “but it’s going to be incredibly exciting to see it happen.”
As the company grapples with these leadership changes, Musk appears determined to refocus attention on xAI’s ambitious goals, including the potential for a public listing. The recent exits of key figures underscore the challenges facing the company, but Musk’s vision for the future remains steadfast.
According to The New York Times, the ongoing developments at xAI highlight the complexities of managing a rapidly evolving tech startup in an increasingly scrutinized industry.