Burning $28 million daily! xAI financial documents leaked: $7.8 billion "burned" in 9 months betting on humanoid robots

Elon Musk’s artificial intelligence startup xAI is burning through cash at a staggering rate. Internal documents show the company spent $7.8 billion in the first nine months of 2025, averaging about $28 million per day, with quarterly losses continuing to expand. xAI’s ultimate goal is to develop an autonomous AI system capable of powering Tesla’s humanoid robot, Optimus.

On Friday, Bloomberg reported that financial documents show xAI posted a net loss of $1.46 billion in the third quarter of 2025, a significant jump from $1 billion in the first quarter. Despite quarterly revenue nearly doubling quarter-over-quarter to $107 million, xAI remains in a phase of massive investment, spending heavily on data centers, talent recruitment, and software development.

In a recent investor conference call, xAI executives revealed the company’s core focus is rapidly building AI agents and other software products, which will eventually be integrated into a pure AI software company called "Macrohard," and provide the power behind Tesla’s Optimus humanoid robot.

xAI has just completed a $20 billion equity funding round, with investors including Nvidia, Valor Equity Partners, and the Qatar Investment Authority, bringing its valuation to $230 billion. This funding is expected to support xAI’s operations for at least the coming year, as monthly investment spending remains under $1 billion.

Losses Widen but Revenue Grows

xAI’s financial data shows typical traits of a fast-growing AI startup. Third-quarter revenue reached $107 million, almost doubling from the previous quarter, but net losses also climbed from $1 billion in Q1 to $1.46 billion.

There are signs of improvement in gross profit. Documents show gross profit for Q3 was $63 million, up from $14 million in the previous quarter. However, for the first nine months through September, xAI posted an EBITDA loss of $2.4 billion, exceeding its prior full-year loss target of $2.2 billion.

Despite strong revenue growth, xAI may not hit its annual target. In June, the company told investors it hoped to reach $500 million in revenue for the year, but as of September had achieved just over $200 million in sales. xAI executives remained optimistic during investor calls, saying year-end results would be positive but withholding specific figures.

Betting on Optimus and the "Macrohard" Strategy

According to sources, in investor calls, xAI executives including Chief Revenue Officer Jon Shulkin said the company’s goal is to build autonomous AI systems to eventually power Tesla's Optimus humanoid robots.

xAI's current core mission is to rapidly develop AI agents and other software products. These products will be integrated into what Musk calls "Macrohard"—a pure AI software company whose name is a parody of "Microsoft"—until they are ultimately able to drive the Optimus robot. Tesla's aim in developing Optimus is to replace human labor.

Executives told investors that xAI has the resources necessary to maintain its heavy spending. Internal documents refer to the rapid growth of AI as "escape velocity"—a term borrowed from celestial mechanics that Musk often uses to describe how quickly companies like SpaceX can grow.

Aggressive Funding Supports Expansion Plans

To sustain its massive spending, xAI Holdings—the parent company of xAI and X—is focused on raising capital. The company recently completed a $20 billion equity funding round, bringing in investors such as Nvidia, Valor Equity Partners, and the Qatar Investment Authority and setting its valuation at $230 billion.

Sources said the cash is expected to cover at least one more year of operations as monthly investment spending remains under $1 billion. In the nine months through September 2025, xAI had used nearly $8 billion in cash for investments.

xAI is raising both equity and debt. The company has worked with Valor and Apollo Global Management to establish special-purpose vehicles to buy Nvidia chips, and expects to close further deals soon to continue expanding its Colossus data center in Memphis, Tennessee. The company is planning expansions of its Memphis campus and recently purchased a third building in the area. Late last year, Musk said this would bring the company’s computing power to nearly 2 gigawatts.

To date, xAI has raised at least $40 billion in equity capital, including the recent $20 billion round announced earlier this month. As of September, the company had paid nearly $160 million in equity compensation, reflecting the intensifying battle for AI talent.

Management Changes and Business Integration

xAI recently made management changes. Former Morgan Stanley banker Anthony Armstrong joined xAI and X as CFO last fall, while Valor Equity partner Jon Shulkin took on new roles at xAI at the end of last year. Previous CFO Mike Liberatore resigned after only three months in the role last fall.

Although Musk runs several independent businesses and projects, he often interweaves their objectives and resources. xAI’s chatbot Grok has been fully integrated into social network X and is also available in Tesla vehicles. SpaceX has invested in xAI, and xAI has spent hundreds of millions on Tesla Megapack batteries.

Although Musk has discussed the potential benefits of formally linking xAI and Tesla, the carmaker is not currently an investor in xAI. Tesla shareholders voted last November on whether the company should invest in xAI—a Musk-backed idea—but the non-binding proposal did not pass. Tesla’s general counsel Brandon Ehrhart said at the time the board was considering its next steps.

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