Welcome back to Week in Review! Elon Musk says that xAI bought X in an all-stock deal; a16z-backed 11x faked some customers; the Lumon Terminal Pro pops up on Apple’s website; and much more. Let’s dig in!
xAI buys X: X owner Elon Musk announced on X on Friday that xAI acquired X in an all-stock transaction. This combination values xAI at $80 billion and X at $33 billion. “Today, we officially take the step to combine the data, models, compute, distribution and talent,” Musk said.
Fudging the numbers: More than 20 sources — including investors and current and former employees — told TechCrunch that a16z- and Benchmark-backed 11x has experienced financial struggles, largely of its own making. “They absolutely massaged the numbers internally when it came to growth and churn,” a former employee said.
Block layoffs: A leaked message by Block CEO Jack Dorsey reviewed by TechCrunch revealed that the company — which owns Cash App and Square — was laying off 931 people, or 8% of the company, as part of an “org restructuring.” Dorsey’s email denies that the layoffs are for financial reasons or to replace workers with AI.
This is TechCrunch’s Week in Review, where we recap the week’s biggest news. Want this delivered as a newsletter to your inbox every Saturday? Sign up here.
News
“What, me do fraud?” The White House confirmed to TechCrunch on Friday that President Trump pardoned Trevor Milton, the founder of bankrupt hydrogen trucking startup Nikola who was convicted of fraud. The pardon comes just a few weeks after Nikola filed for Chapter 11 bankruptcy.
Speaking of leaks: A leaked database seen by TechCrunch shows that China has developed an AI system that supercharges its already formidable censorship machine, extending far beyond traditional taboos like the Tiananmen Square massacre.
Skunkworks spins out: Rivian’s skunkworks project was spun out of the company with a new name and $105 million in funding from Eclipse Ventures. The startup, called Also, will exist as a stand-alone company from Rivian.
Get your computers ready: Apple announced that Worldwide Developers Conference 2025 will begin June 9. Reports have indicated that Apple has prepared dramatic software overhauls for the iPhone, iPad, and Mac. We also expect iOS 19, which, according to Bloomberg, will be “the biggest revamp since iOS 7.”
DNA debacle: DNA testing company 23andMe filed for bankruptcy this week. The company’s co-founder and CEO, Anne Wojcicki, separately said she is leaving to become an independent bidder for the company. Your data might not be safe, so here are some ways to delete it.
An act of Congress: Kat Abughazaleh, the 26-year-old who was among the people laid off from Media Matters after Elon Musk sued the company, announced this week that she’s running for Congress. “I’m trying to be really transparent about how to run for office, because I feel like it’s kind of this black hole that seems a lot more difficult than it should be,” she told TechCrunch.
A slice of “Severance”: I haven’t watched any seasons of “Severance,” and based on seemingly everyone in the world, I’m absolutely missing out. My colleague Sarah is among those people, and she spotted a Lumon Terminal Pro (the machine they use in the show) on Apple’s website.
Backdoor to China: SpaceX, a defense contractor for the Pentagon, reportedly allowed Chinese investors to buy shares, as long as the funds are routed through the Cayman Islands or other offshore hubs.
The Switch 2 is coming! And at Nintendo Direct, the company announced that it’s working on Virtual Game Cards that allow players to take their downloaded games with them to use on other devices.
Analysis
ChatGPT’s new image generator launched this week, and with it came a flood of images based on art by Studio Ghibli being posted online. While the debate over whether this is horrifying (Studio Ghibli co-founder Hayao Miyazaki once said that “AI is an insult to life itself”) or cool, it does highlight one thing: Copyrights are still a concern when it comes to AI-generated anything. Although copying the art style isn’t necessarily unlawful, OpenAI training its models on Studio Ghibli’s art operates in a legal “gray area.”
“I think this raises the same question that we’ve been asking ourselves for a couple years now,” Evan Brown, an intellectual property lawyer, told TechCrunch. “What are the copyright infringement implications of going out, crawling the web, and copying into these databases?”