Elon Musk has spoken on xAI’s future just weeks after hosting a mass layoff at the company. The CEO of Tesla and SpaceX has made a striking declaration about his AI venture in a recent post on X (formerly Twitter), stating that xAI will match the capabilities of leading AI competitors like OpenAI, Google, and Anthropic by the end of 2026.
Musk didn’t stop there, though. He even went on to predict that xAI will not only surpass them but do so by such a substantial margin that “you will need the James Webb telescope to see who is in second place” within three years.
This confident statement came in direct response to a user’s claim, which stated that rivals are currently competing at the forefront of AI development, but xAI and Meta lag behind by approximately seven months. Musk’s response seems like the company underwent a major shakeup.
Elon Musk’s bold statement after reorganisation and layoffs
The announcement comes just days after xAI underwent a major internal shake-up. The company underwent sweeping layoffs and a major restructuring, resulting in the departure of most of its original co-founders. Out of the initial 11 co-founders, only two remain.
Musk himself acknowledged the need for change, stating that “xAI was not built right the first time around, so is being rebuilt from the foundations up.”
This restructuring follows challenges in key areas, particularly AI coding tools. xAI’s Grok models briefly outperformed Google’s Gemini and OpenAI’s ChatGPT in various benchmarks late last year, but subsequent releases from competitors such as Google’s Gemini 3.0 and 3.1 have reclaimed the lead. Meanwhile, Anthropic’s Claude continues to be a preferred choice among developers and coders.
Musk on a mission to lead
To address the performance shortcomings, Musk is taking proactive steps. He is said to personally review rejected job applications alongside colleague Baris Akis for identifying and hiring promising talent. The company’s goal is to strengthen coding capabilities, where Grok currently trails behind tools like Anthropic’s Claude Code and OpenAI’s offerings.
One of the major strategic shifts for xAI is its merger with SpaceX earlier in the year. The companies were merged to better manage the immense electricity and cooling requirements for advanced AI training in a more sustainable manner.
Despite the recent setbacks and controversies, such as backlash over Grok’s relatively unrestricted text and video generation features, leading to issues like deepfake content, Musk remains optimistic. What remains to be seen is whether xAI manages to build class-leading AI models by the end of the year and challenge the dominance of models from Google and OpenAI.