Elon Musk‘s artificial intelligence startup xAI faces mounting leadership instability as Chief Financial Officer Mike Liberatore departed in late July after just three months on the job, marking the latest in a series of high-profile executive exits that could signal operational challenges for the AI venture.
CFO Departure Follows Rapid Fundraising Success
Liberatore joined xAI in April and played a key role in the company’s massive $10 billion funding round completed in June. The former Airbnb executive helped orchestrate a $5 billion debt sale through Morgan Stanley Co. Inc. (NYSE:MS) alongside $5 billion in equity, with Tesla Inc. (NASDAQ:TSLA) contributing nearly half the equity investment.
The CFO also oversaw critical infrastructure expansion at xAI’s Memphis data center operations before his unexpected departure around July’s end, reported the Wall Street Journal, citing sources. Property records show Liberatore signed off on transmission line easements for the company’s Tennessee facilities just weeks before leaving.
xAI Corp. did not immediately respond to Benzinga's request for comment.
Wave of Executive Exits Raises Stability Concerns
The leadership exodus extends beyond the CFO role. General Counsel Robert Keele announced his departure on August 7 after just over a year, citing “daylight between our worldviews” with Musk in his farewell post featuring a Grok-generated image of a “crazed-looking man shoveling coal.”
Co-founder Igor Babuschkin, a veteran from Alphabet Inc.‘s (NASDAQ:GOOGL) (NASDAQ:GOOG) DeepMind and OpenAI, left August 13 to launch an AI safety venture capital firm. Senior commercial lawyer Raghu Rao also departed around the same timeframe as Liberatore and Keele, according to the report.
Operational Challenges Amid Aggressive Expansion
The departures come as xAI pursues ambitious infrastructure goals, including plans to raise $12 billion in additional debt to purchase NVIDIA Corp. (NASDAQ:NVDA) chips for supercomputing clusters. Musk recently announced xAI operates 230,000 GPUs for training its Grok chatbot, with plans for 550,000 additional chips.
However, technical malfunctions have plagued Grok, including antisemitic posts and violent content generation that forced temporary disconnection from the X platform. The incidents contributed to former X CEO Linda Yaccarino‘s resignation and subsequent demotion after Musk merged X with xAI earlier this year.
The executive turnover coincides with legal battles, including xAI’s lawsuit against former engineer Xuechen Li for allegedly stealing trade secrets before joining OpenAI, highlighting the intense competition for AI talent and intellectual property in the sector.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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