Elon’s $14B AI Experiment Is Illegally Blowing Smoke... And $33 Million a Day

Things haven’t exactly been firing on all cylinders for Elon since his Twitter feud with President Trump… who may or may not have implied that Elon’s been raiding Hunter’s pharmacy drawer. At this rate, it’s only a matter of time before high schoolers are thumbing through their digital textbooks and landing on Chapter 26: The Great AI Race and the Time Elon Musk Got Sued for Polluting Memphis While Sh*tposting at the President. Because yeah… Elon’s summer has gone from “he’ll probably regret that” to “you have to be kidding me” for his superfans.

The NAACP filed a formal letter of intent to sue his AI company, xAI, for allegedly running 35 unpermitted gas turbines in South Memphis. Some may think this is no big deal, but these aren’t cute little startup generators either. They’re reportedly pumping out over 2,000 tons of nitrogen oxides every year… which is about as much as half a million gas-powered cars emit annually. Memphis, by the way, already ranks as one of the worst cities in America for asthma. And wouldn’t you know it, throwing a few dozen pollution-spewing engines into the mix isn’t exactly improving the air quality.

Here’s the funny part… xAI’s permit only listed 15 turbines. The other 20 were discovered by SouthWings, an environmental nonprofit that apparently decided “screw it, let’s do an aerial surveillance mission.” Yes, a literal flyover caught Elon’s turbine ghost army in action. We’re officially at the point where environmental justice requires pilot goggles.

Local residents aren’t thrilled to be part of Musk’s unofficial field test. Barbara Britton, head of the Boxtown Neighborhood Association, made it crystal clear they aren’t going down quietly. And if the Shelby County Health Department keeps dragging its feet, lawsuits are ready to roll. Add another court date to Elon’s already packed litigation calendar. So, to recap: the same guy who pioneered electric vehicles to save the environment is now allegedly cooking up diesel-grade pollution in a low-income Black neighborhood with unauthorized equipment. If irony were a fuel source, Elon could’ve powered the entire Colossus data center for free.

While all that was unfolding in Memphis, Sam Altman (Musk’s AI rival) landed a super coveted $200 million Pentagon contract for OpenAI (probably the same one Trump promised Elon’s company before he accused him of being on the Epstein list). Meanwhile, Elon proudly announced a $300 million partnership with Telegram… a platform known less for innovation and more for being the digital equivalent of a back alley. Telegram’s CEO, Pavel Durov, is currently being investigated in France for allegedly enabling drug trafficking, child exploitation, and financial fraud . So not exactly a power move you'd want associated with your “we’re here to save humanity” brand.

And before anyone starts saying, “Yeah, bad partnership, but at least xAI is bringing in cash,” let’s look at the receipts. xAI is currently burning $1 billion a month. That’s about $33 million a day, or (I did the math) enough to buy every American a Popeyes combo meal with dessert until Christmas. Since launching in 2023, xAI raised $14 billion, and as of Q1 2025, they’ve only got $4 billion left in the bank. The other $10 billion has vanished into the void, probably on GPUs and legal retainers.

To fill the black hole, Musk is now trying to raise $4.3 billion in equity, $5 billion in debt, and plans to hunt down another $6.4 billion next year. So there’s that. And after all that, xAI expects to generate just $500 million in revenue this year. For comparison, OpenAI is projected to haul in $12.7 billion. So yeah… xAI is looking more like a Temu OpenAI knockoff (at least for now).

Oh, and let’s not forget… xAI is now merged with X, Elon’s personal passion project. So the same company that’s trying to win over investors with visions of AI domination is also the place where Musk posted about killing a Trump-backed death cult at 2 a.m. At this point, it’s hard to say what xAI actually is. Whatever it is, his wealthy investors (since the company’s not public) don't seem impressed. But if we know anything about Elon, right when everyone counts him out, that’s when he gets serious.

At the time of publishing this article, Stocks.News doesn’t hold positions in companies mentioned in the article.