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xAI Co-Founders Bolt After SpaceX Merger

xAI Co-Founders Bolt After SpaceX Merger

The Verge just dropped a report on the fallout at xAI following its $1.25 trillion merger with SpaceX last week. A few employees and two of the co-founders have already quit. Both Jimmy Ba and Yuhai (Tony) Wu shared the news of their exits on X. Wu mentioned he’s ready for a "next chapter," while Ba made a joke about "recalibrating his gradient" on the bigger picture, which is about as AI-researcher as it gets. With these departures, xAI is now down to only half of the original twelve co-founders who started the company.

A person moving cardboard boxes out of an office desk.

The context is pretty wild. This merger basically pulls xAI into SpaceX—and seemingly X as well—to chase Musk’s goal of putting AI data centers in space. He's looking for total vertical integration between rockets, AI, satellite internet, and social media. Reports from an internal meeting even mentioned ideas like a lunar city and a factory for AI satellites. But things aren't exactly smooth. Musk took to X to say the recent shake-up was about moving faster, which apparently required letting some people go. He even posted a 45-minute recording of an all-hands meeting where he laid out his plan for scaling the whole operation.

The Verge is pretty much the only place with the granular details on these two specific departures, mostly piecing things together from Musk's own updates. Other outlets point out that this exodus started well before the merger; about half the founders were already out the door by February, and the pace just picked up through the spring. You see the same names popping up everywhere: Christian Szegedy left in 2025, Igor Babuschkin went off to start a VC firm, and Greg Yang stepped away for health reasons. Then you have Toby Pohlen, Zihang Dai, Guodong Zhang, Manuel Kroiss, and Ross Nordeen, who all called it quits around April. According to reports from Fortune and Business Insider, by early 2026, every single one of the 11 original co-founders—besides Musk himself—had moved on.

A person standing in front of a futuristic holographic map of the moon with space station designs.

The official announcements didn't offer much in the way of gossip. Ba thanked Musk and mentioned they’d stay on good terms, while Wu stayed pretty vague about the whole thing. Musk, on the other hand, pointed toward the tools themselves, claiming things like the coding assistants weren't performing well enough. He admitted xAI wasn't built correctly from the start and basically needed a total overhaul. It’s a move that looks a lot like his past shakeups at Tesla, especially now that SpaceX is looking at a $1.75 trillion IPO. After the merger, the cuts reached the C-suite as well, while a wave of engineers from Tesla and SpaceX started moving in to fill the gaps.

A person speaking into a microphone while standing in front of a group of colleagues in an office.

I managed to flip through five different articles in the time it takes to make a cup of coffee. The Verge went for a more dramatic angle, focusing on the 'abrupt' nature of the departures and those long-winded farewell posts. Fortune took a more practical route, highlighting how losing talent like this could actually jeopardize the IPO. Meanwhile, Business Insider thinks this is all tied back to product failures. Everyone agrees the exits are happening, they're just arguing over why the ship is leaking. One thing most of them missed though: hardly anyone mentioned that xAI bought X back in 2025, which really laid the tracks for all this consolidation we're seeing now.

Elon asking for new hires right in the middle of a mass walkout is just classic. Most people want stability, but he seems to build things by breaking them first. Even with half the founding team gone, xAI is still pushing forward at full speed. Or at least, heading wherever those rockets are going next.

A person moving cardboard boxes out of an office desk.

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