Yann LeCun described Elon Musk's AI company xAI as a "failure" due to the departure of its founding team and Musk’s difficulty in hiring top AI talent. He said, "xAI is kind of a failure, frankly, because the founding team has departed. Elon is now in a position that is very, very difficult for him to kind of hire top people in AI, because he's kind of, you know, not behaved in sort of very good ways toward the ... previous team" [1]. LeCun repeated this assessment in Mandarin, emphasizing the challenge Musk faces recruiting elite researchers after how the previous team was treated [2].
LeCun noted that xAI leases its large data centers to competitors like Anthropic to try to recover operating costs. He said, "He's got this huge infrastructure, which he rents to other people, because that's the only way he can recoup the costs" [3]. xAI became part of SpaceX in a February 2026 merger that valued the combined company at $1.25 trillion [1]. However, the SpaceX AI segment, including xAI, posted a $2.5 billion loss from operations in the quarter ending March 31, 2026 [1].
LeCun warned of a "big bubble explosion" risk across the AI industry due to rising prices for AI services and persistently high costs. He called on the sector to focus on AI systems based on "world models"—which understand objects, causality, and behavior—as the only path to reliable general AI [1, 2]. He praised Musk's SpaceX and said he personally owns a Tesla, but criticized Musk's full self-driving system as useful but not truly fully autonomous [3].
The AI industry has seen mixed fortunes in 2026. While xAI struggles, other players raised significant funds, such as AMI Labs, which secured $1 billion at a $3.5 billion valuation in March 2026 [1].
LeCun’s interview on June 18, 2026, highlighted ongoing challenges for Musk's AI ambitions amid broader concerns about AI market sustainability and technological breakthroughs [1, 3, 2].
