Saudi Arabia's state-backed AI venture, Humain, has made a significant strategic move with a $3 billion investment in Elon Musk's xAI, just weeks before the AI company's acquisition by SpaceX. This deal is a major step in Riyadh's plan to become a global AI hub, deepening the ties between Middle Eastern capital and Western technology.
The investment was part of xAI’s Series E financing round, which raised a total of $20 billion in new capital before the integration with SpaceX. Humain's stake, acquired via the Saudi Public Investment Fund (PIF)-backed company, will automatically convert into shares in the newly combined SpaceX-xAI group. This secures a long-term equity position in the merged business, which is now valued at approximately $1.25 trillion.
A Strategic Pivot Towards AI
Launched in 2025 and backed by the PIF, Humain's mission is to spearhead the Kingdom’s economic diversification away from fossil fuels by establishing it as a global AI centre. The $3 billion commitment to xAI perfectly aligns with this strategy, demonstrating Riyadh’s willingness to deploy substantial capital in advanced technology platforms.
Saudi Arabia has a long-standing commitment to AI, viewing AI infrastructure, data centre capacity, and compute power as vital for future economic expansion. Humain’s funding activities, which include developing AI computing infrastructure and supporting applied AI models, are integral to this continued push.
From Partnership to Significant Shareholding
This investment follows a partnership established in November 2025 at the U.S.–Saudi Investment Forum, where Humain and xAI agreed to jointly develop over 500 megawatts of next-generation AI data centre infrastructure in Saudi Arabia. The plans also included deploying xAI’s Grok language model across the Kingdom, reinforcing their technical collaboration.
By becoming a significant minority shareholder in xAI—and soon in SpaceX—Riyadh's role is evolving from a strategic partner to an investor with direct financial exposure to the technology’s future. The conversion is expected to give Humain a roughly 0.24 per cent stake in the consolidated SpaceX-xAI entity, providing a direct foothold in one of the world's most ambitious technology platforms.
Global Significance in the AI Landscape
The timing of this investment is critical. xAI, founded by Elon Musk in 2023 to challenge leaders like OpenAI and Anthropic, rapidly scaled up its operations, culminating in the upsized Series E closing in January 2026.
Weeks after this successful fundraising, the company was acquired by Musk's aerospace firm, SpaceX, creating a combined platform with greater resources and ambition. This integration is set to leverage SpaceX’s global tech stack, including satellite connectivity, with xAI’s cutting-edge generative AI capabilities, promising to accelerate innovation across both sectors.
For Humain and Saudi Arabia, entering the deal just before the merger is strategically advantageous, allowing them to benefit from the equity upside of one of the world’s most valuable private technology companies while cementing a long-term relationship with Musk’s AI ecosystem.
Broader Geopolitical and Economic Implications
This investment is part of a larger trend where Gulf states are directing sovereign capital into advanced technologies to strategically diversify their domestic economies and reduce oil dependency. AI is seen as a crucial area for this diversification due to its potential to transform sectors from healthcare to energy.
The partnership also enhances Saudi Arabia’s engagement with global tech leaders. Securing a position in a technology platform linked to SpaceX and encompassing applications from advanced computing to autonomous systems provides Riyadh with potential influence in both commercial and strategic spheres.
Market Dynamics and Sovereign Investment
Humain’s commitment signals strong confidence in Musk’s AI strategy, despite Grok's ongoing competition with established generative AI models. This financial backing could significantly boost xAI’s capacity for research, deployment, and global adoption.
Moreover, the deal highlights the increasing role of sovereign investment in driving AI development. Wealth funds in Saudi Arabia, Qatar, and the UAE are increasingly prominent backers of AI firms, recognising that control over data and compute power is essential for future technological paradigms.
A Globalised AI Future
For international observers, the Humain-xAI transaction confirms that AI innovation is no longer solely concentrated in Silicon Valley. Cross-border capital flows, strategic partnerships, and integrated tech platforms are becoming the norm in the global AI ecosystem. This collaboration underscores the increasingly interconnected nature of global technology leadership as nations and companies grapple with the balance between innovation, regulation, and ethical AI use.
