SpaceX-xAI $1.25T Mega-Merger & Waymo's Record $16B Funding | February 4, 2026

Daily AI Blog

📋 Quick Takeaways

  • SpaceX acquires xAI in largest merger in history, creating $1.25 trillion combined entity with plans for orbital AI data centers
  • Waymo raises record $16 billion at $126B valuation, plans expansion to 20+ cities including London and Tokyo
  • AMD reports record Q4 revenue of $10.3B but forecasts cautious Q1 2026 amid China AI chip restrictions
  • Siemens Energy commits $1 billion to U.S. manufacturing for AI data center power infrastructure
  • Alphabet reports Q4 earnings with focus on Google Cloud AI growth and $116B 2026 capex plans
  • OpenAI confirms GPT-4o retirement on February 13 as GPT-5.2 dominates with 99.9% usage share

🚀 Historic Mergers & Acquisitions

SpaceX Acquires xAI in $1.25 Trillion Mega-Merger — Largest Deal in History

Historic Transaction: Elon Musk’s SpaceX has officially acquired his AI startup xAI, creating the world’s most valuable private company valued at $1.25 trillion and marking the largest corporate merger ever recorded.

Deal Structure:

  • SpaceX valued at approximately $1 trillion
  • xAI valued at approximately $250 billion
  • Share exchange ratio: 1 xAI share converts to 0.1433 SpaceX shares
  • SpaceX IPO planned for mid-2026, potentially raising up to $50 billion

Strategic Rationale:

  • Building “orbital data centers” — AI compute infrastructure in space
  • Musk stated: “Global electricity demand for AI simply cannot be met with terrestrial solutions”
  • Plans to launch constellation of up to one million AI satellites
  • SpaceX filed FCC authorization for AI satellite constellation last week

Financial Context:

  • xAI currently burning approximately $1 billion per month
  • SpaceX generated estimated $8 billion profit on $15-16 billion revenue in 2025
  • Tesla invested $2 billion in xAI in January 2026
  • Combined entity includes X (formerly Twitter) social media platform

Industry Implications: The merger creates an unprecedented vertically-integrated AI infrastructure stack combining launch capacity, global satellite connectivity, and frontier AI model development that few organizations can match.

Sources: Bloomberg | CNBC | TechCrunch | CNN

💰 Record-Breaking AI Funding

Waymo Secures $16 Billion — Largest Autonomous Vehicle Investment Ever

Unprecedented Funding: Alphabet’s autonomous driving unit Waymo has raised $16 billion at a $126 billion post-money valuation, representing the largest investment in autonomous vehicle history.

Investor Syndicate:

  • Lead Investors: Dragoneer Investment Group, DST Global, Sequoia Capital
  • Major Participants: Andreessen Horowitz, Mubadala Capital, Bessemer Venture Partners, Silver Lake, Tiger Global, T. Rowe Price
  • Additional Investors: BDT & MSD Partners, CapitalG, Fidelity, GV, Kleiner Perkins, Perry Creek Capital, Temasek
  • Majority Stakeholder: Alphabet maintains majority investor position

Expansion Plans:

  • 2026 U.S. Cities: Dallas, Denver, Detroit, Houston, Las Vegas, Miami, Nashville, Orlando, San Antonio, San Diego, Washington D.C.
  • International Markets: Tokyo and London confirmed as first international markets
  • Total: 20+ new cities planned for 2026

Operational Milestones:

  • 15 million rides completed in 2025 (tripled from 2024)
  • 20+ million lifetime rides to date
  • 400,000+ rides delivered weekly across six U.S. metropolitan areas
  • 127 million autonomous miles driven

Safety Record: Waymo claims 90% fewer serious injury crashes compared to human drivers, though facing NHTSA investigations regarding school zone incidents.

Sources: TechCrunch | Bloomberg | CNBC | Waymo Blog

🔧 AI Chip Industry & Earnings

AMD Reports Record Q4 2025 Revenue but Signals Cautious Q1 2026

Q4 2025 Performance:

  • Revenue: $10.3 billion (+34% year-over-year)
  • Data Center Revenue: Includes $390 million from MI308 AI chips sold to China
  • Gross Margin: Non-GAAP approximately 55%

Q1 2026 Guidance:

  • Expected Revenue: ~$9.8 billion (5% sequential decline, +32% YoY)
  • China Revenue: Additional $100 million MI308 shipments expected
  • Outlook: Company not counting on additional China revenue due to export restrictions

Strategic Developments:

  • Next-generation flagship AI servers expected to ramp in H2 2026
  • OpenAI confirmed as key customer for upcoming products
  • Helios rack-scale platform scheduled for Q3 2026 deployment
  • Oracle committed to deploying 50,000 MI450 Series chips

China Export Context: CEO Lisa Su noted $390 million Q4 China revenue came from orders placed “very early in 2025” with shipments completed after securing export licenses. Trump administration allowing exports of advanced AI chips including AMD’s MI325.

Sources: TrendForce | Reuters

⚡ AI Infrastructure & Energy

Siemens Energy Announces $1 Billion U.S. Investment for AI Data Center Power

Major Infrastructure Commitment: German industrial giant Siemens Energy announced a $1 billion investment to expand U.S. power grid and gas turbine manufacturing capacity to meet surging AI data center electricity demand.

Investment Scope:

  • New Factory: Mississippi facility for high-voltage switchgear (largest globally), completion expected 2028
  • Expansions: Florida, North Carolina, Alabama, Texas, New York facilities
  • Jobs: 1,500+ new highly skilled positions
  • Capacity: ~20% increase in global large turbine production

Market Context:

  • Data centers projected to consume 12% of U.S. grid capacity by 2028 (triple 2024 levels)
  • Siemens has 20 gigawatts of generation power contracted/reserved for U.S. data centers
  • CEO Christian Bruch: “The U.S. is the hottest electricity market in the world”

AI Partnership: Orlando Innovation Center will establish AI-focused digital grid technologies laboratory in collaboration with NVIDIA.

Strategic Significance: Investment signals that AI infrastructure buildout is now constrained by physical power generation capacity, not just chip availability.

Sources: Reuters | New York Times | BNN Bloomberg

📊 Big Tech Earnings & Strategy

Alphabet Q4 2025 Earnings — AI Cloud Growth in Focus

Earnings Preview (Reporting February 4 after market close):

  • Expected Revenue: $111.4 billion (+15% YoY)
  • Expected EPS: $2.64 (up from $2.15 year-ago)
  • Google Cloud Expected: $16.2 billion (+35% YoY)
  • Google Services Expected: $94.9 billion (+13% YoY)

AI Strategic Focus:

  • Gemini 3 AI model driving competitive repositioning
  • Google maintaining ~90% search market share through AI Overviews feature
  • Cloud segment benefiting from deals with Meta, Anthropic, and OpenAI
  • 2026 capital expenditure expected at approximately $116 billion

Stock Performance: Alphabet shares up 81% in past six months following successful Gemini 3 launch that restored competitive positioning against OpenAI and Anthropic.

Analyst Sentiment: Bank of America maintains Buy rating with $355 price target, citing Gemini 3.0 and TPUs as increasingly differentiating Google Cloud offerings.

Sources: Seeking Alpha | Yahoo Finance | CoinCentral

🤖 AI Model Developments

OpenAI Confirms GPT-4o Retirement on February 13, 2026

Model Retirement Announcement: OpenAI confirmed that GPT-4o and several other models will be permanently retired from ChatGPT on February 13, 2026.

Models Being Retired:

  • GPT-4o
  • GPT-4.1
  • GPT-4.1 mini
  • OpenAI o4-mini
  • GPT-5 Instant and Thinking (previously announced)

Usage Statistics:

  • Only 0.1% of users still selecting GPT-4o daily
  • “Vast majority” of usage has shifted to GPT-5.2
  • API access remains unchanged for now

Background Context: GPT-4o, launched May 2024, was beloved for its “conversational warmth” and creative ideation capabilities. OpenAI restored access after user backlash during initial deprecation, but feedback has been incorporated into GPT-5.1 and GPT-5.2.

Future Direction: OpenAI continues developing version of ChatGPT “designed for adults over 18” with expanded user choice and freedom within appropriate safeguards.

Sources: OpenAI | CNBC | Bleeping Computer

Claude 5 “Fennec” Spotted in Google Vertex AI Logs

Leak Discovery: In early February 2026, the AI community identified what appears to be Anthropic’s next-generation model in Google Vertex AI error logs.

Leaked Details:

  • Model Identifier: claude-sonnet-5@20260203
  • Codename: “Fennec” for Sonnet 5
  • Expected Release: February-March 2026

Anticipated Features:

  • Pricing approximately 50% lower than Opus 4.5
  • Performance comparable or superior to Opus 4.5 in most benchmarks
  • New “Dev Team” multi-agent collaboration mode
  • Significant boost in mathematical reasoning capabilities
  • Faster response speeds while maintaining Opus-level performance

Strategic Context: The leak suggests Anthropic is preparing a major competitive move as the AI model race intensifies in 2026.

Sources: Apiyi.com

🔴 Service Disruptions

ChatGPT Experiences Global Outage Affecting Millions

Incident Details (February 3, 2026):

  • Over 12,000 user reports on Down Detector at peak
  • Two confirmed issues: “Elevated error rates for finetuning jobs” and “Elevated errors for ChatGPT and Platform users”
  • International users (UK, Hungary) more severely affected than U.S. users
  • Service restored within hours after mitigation deployed

Impact: The outage highlighted continued reliability challenges for AI infrastructure as enterprise adoption accelerates.

Sources: TechRadar

🔬 AI Evaluation & Standards

Together AI Opens Evaluation Platform to Major AI Providers

Platform Expansion (February 3, 2026): Together AI expanded its Evaluations platform to enable direct benchmarking between open-source and proprietary AI models.

Supported Models:

  • OpenAI: GPT-5, GPT-5.2
  • Anthropic: Claude Sonnet 4.5, Claude Haiku 4.5, Claude Opus 4.5
  • Google: Gemini 2.5 Pro, Gemini 2.5 Flash

Industry Significance: Creates first standardized framework for enterprises to make side-by-side comparisons when selecting AI infrastructure, potentially reshaping enterprise AI procurement decisions.

Sources: Bitcoin Ethereum News

👥 Workforce Impact

February 2026 Announcements:

  • Pinterest: 15% workforce cut for “AI-forward strategy”
  • Dow: 4,500 jobs eliminated citing AI and automation
  • CrowdStrike: ~500 positions cut
  • HP: 4,000-6,000 employees (targeting $1B savings by 2028)
  • Indeed/Glassdoor: ~1,300 jobs

Analyst Commentary: Oxford Economics suggests some firms may be “dressing up layoffs as a good news story” using AI as pretext rather than citing past overhiring.

Industry Trend: Pattern of simultaneous AI investment and workforce reduction reflects strategic pivot toward automation across sectors.

Sources: CBS News

🏅 AI in Sports

IOC Deploys AI-Assisted Judging at Winter Olympics 2026

Historic Implementation: The International Olympic Committee has begun rolling out AI-assisted judging systems at the Winter Olympics 2026.

Expected Impact:

  • Standardization of judging across subjective sports
  • Reduced human bias in scoring
  • Real-time analytics for athletes and coaches

Broader Implications: Deployment signals AI’s expanding role in high-stakes decision-making across professional sports, raising questions about human judgment versus algorithmic consistency.

Sources: The Conversation

✈️ Aviation & Emerging AI

Skyryse Secures $300 Million for FAA-Certified Aviation AI

Funding Round (February 3, 2026):

  • Amount: $300 million
  • Lead Investor: Autopilot Ventures
  • Other Investors: Fidelity Management, Qatar Investment Authority, ArrowMark Partners

Technology Platform:

  • FAA-certified “fly-by-software” aviation operating system
  • Already demonstrated in Black Hawk helicopters
  • Automates complex flight maneuvers to reduce pilot workload
  • Addresses growing pilot shortage across commercial and defense sectors

Market Opportunity: Reflects investor appetite for autonomous flight systems as aviation industry seeks technology solutions for workforce and safety challenges.

Sources: Tech Startups

RapidFort Raises $42M for AI-Powered Software Supply Chain Security

Series A Funding (February 3, 2026): Cybersecurity startup RapidFort secured $42 million to scale its AI-powered platform for securing software supply chains.

Strategic Relevance: Growing concern around AI-related security vulnerabilities, particularly as organizations deploy self-hosted AI models and agentic systems with expanded attack surfaces.

Sources: Tech Startups

Alaffia Health Raises $55 Million for AI Insurance Claims Platform

Series B Funding (February 3, 2026):

  • Amount: $55 million (total raised: $71.6 million)
  • Lead Investor: Transformation Capital
  • Founded: 2020

Platform Capabilities:

  • Agentic AI for automated claims review
  • Real-time detection of billing waste and errors
  • Targets U.S. healthcare market (>$4 trillion annual spending)

Use of Funds: Expanding engineering and data science teams while growing insurer client base.

Sources: Tech Startups

📈 Market Impact Analysis

The convergence of February 3-4 developments reveals several critical themes shaping AI’s trajectory:

Infrastructure Consolidation: The SpaceX-xAI merger signals that AI infrastructure competition has entered a new phase where vertical integration of compute, connectivity, and model development creates decisive advantages.

Power as Constraint: Siemens’ $1 billion investment underscores that electricity generation—not GPU availability—is becoming the binding constraint on AI scaling.

Autonomous Vehicle Inflection: Waymo’s $16 billion round at $126 billion valuation suggests investors believe autonomous driving has crossed from experimental to commercially scalable.

Model Lifecycle Acceleration: OpenAI’s GPT-4o retirement after just 20 months demonstrates the rapid deprecation cycle in frontier AI, challenging enterprise adoption planning.

Capital Concentration: Combined funding announcements exceed $17 billion in 48 hours, with capital flowing to companies demonstrating operational scale rather than research potential.

🔮 Looking Ahead

Key Developments to Watch:

  • SpaceX-xAI IPO preparations and regulatory review (CFIUS considerations)
  • Waymo international expansion execution in London and Tokyo
  • Alphabet Q4 earnings AI commentary and 2026 capex guidance
  • Claude 5 official announcement timing
  • AMD next-generation AI chip production ramp in H2 2026

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Last Updated: February 4, 2026, 11:59 PM CST