Elon Musk's xAI is cutting about 50 employees, including two co-founders. For a company with roughly 500 people, this is a 10% reduction that hits at the leadership level. The reorganization suggests strategic disagreements at the top about xAI's direction.
xAI's cuts are unusual because the AI sector is generally adding jobs, not cutting them. The company's Grok chatbot competes against ChatGPT and Claude, and the workforce reduction raises questions about whether xAI's rapid scaling phase has hit a wall or whether Musk is simply applying his well-known approach of aggressive headcount optimization.