Bloomberg Podcasts
@bloombergpodcasts·503K subscribers·32.4K videos
Expect Tesla and SpaceX to Eventually Merge, Says Dan Ives
Posted
February 5, 2026
Views
23,132
Likes
407
Comments
65
Engagement
February 5, 2026
23,132
407
65
2.04%
Every word spoken in this episode is indexed. Type any phrase to jump straight to the moment it was said.
Type any word or phrase that may have been spoken. Click a result to seek the player to that exact moment.
Try a name, a topic, or a quoted line
14:48Now PlayingDan Ives, Global Head of Tech Research at Wedbush Securities, discusses the SpaceX-xAI merger and what he calls the 'software Armageddon.'
By many counts, SpaceX is the most successful venture Elon Musk ever started. The rocket maker revolutionized the space industry, built a multibillion-dollar business fueled by lucrative government contracts and a growing satellite communications network, and still has few credible competitors.
XAI Holdings is not that. The company, which owns Musk’s AI startup and the social network X, is saddled with billions of dollars in debt, besieged by well-funded rivals and faces mounting regulatory scrutiny after its chatbot spread sexualized images. It also brings in scant revenue, compared to SpaceX. Much of what it does generate comes from Musk’s other businesses.
Over the past year, xAI has been buoyed by a web of contracts and investments between Musk’s ventures, with echoes of the circular deals underpinning the wider AI sector – except in this case, these arrangements are strictly within the business empire of the world’s richest man. Now, xAI is getting its largest lift to date, courtesy of Musk’s crown jewel, SpaceX.
On Monday, Musk announced plans to merge the two companies in a deal that values the enlarged entity at $1.25 trillion ahead of an expected IPO. To some industry watchers, the combination appears poised to create a juggernaut that appeals to a broader swath of Wall Street investors, and possibly spurs a sci-fi-sounding race to put AI data centers in space. To others, including some insiders, the acquisition looks less like a merger than a rescue mission.
It wouldn’t be the first time one Musk venture has come to the aid of another. X, formerly known as Twitter, was performing so badly after Musk’s $44 billion acquisition that the Wall Street banks that helped finance the deal couldn’t get the debt off their books. Last March, Musk merged X with xAI to value the social network at $45 billion, including debt, even though X’s revenue was down by nearly half from the buyout in 2022. X is still paying tens of millions or more every month to cover the interest on its roughly $12.5 billion in debt commitments.
--------
Watch Bloomberg Radio LIVE on YouTube
Weekdays 7am-6pm ET
Follow us on X
Subscribe to our Podcasts:
Bloomberg Daybreak
Bloomberg Surveillance
Bloomberg Intelligence
Balance of Power
Bloomberg Businessweek
Listen on Apple CarPlay and Android Auto with the Bloomberg Business app:
Apple CarPlay
Android Auto
Visit our YouTube channels:
Bloomberg Podcasts
Bloomberg Television
Bloomberg Originals
Sentinel Indexing in Progress
Metadata and chapters are available. Claim extraction for this episode is pending.
All video content is delivered via YouTube embedded players in accordance with the YouTube Terms of Service. Sentinel provides research tools that promote discovery and accountability across political media.
