Elon Musk’s artificial intelligence company, xAI, has announced significant layoffs, cutting at least 500 jobs from its data annotation division that supports the Grok chatbot, according to a Business Insider report.
Citing internal emails reviewed by Business Insider, the report said employees were informed on Friday night that the company was downsizing its team of generalist AI tutors. These staff members were responsible for training Grok by categorizing and contextualizing raw data, making the data annotation team the largest within the company.
As part of the xAI layoffs, workers were told they would be paid through either the end of their contract or until November 30, but their access to company systems was revoked immediately after receiving the notice.
In response to media queries, xAI referred to a statement on X in which the company said it was actively hiring across multiple roles and planned to expand its specialist AI tutor workforce by “10X.”
The development follows reports that xAI finance chief Mike Liberatore left the company in late July after only a few months in the role, the Wall Street Journal said, citing sources familiar with the matter. Musk, who launched xAI in 2023, has positioned the venture as a competitor to Big Tech companies, criticizing them for excessive censorship and weak safety practices.