Elon Musk’s artificial intelligence startup, xAI, has reportedly laid off at least 500 employees from its data annotation team, which plays a key role in training the company’s Grok chatbot, according to Business Insider.
The layoffs were announced in an email sent to staff on Friday night, informing them that the company was cutting its team of generalist AI tutors.
Impacted employees were told they would receive pay through the end of their contracts or until November 30, but their access to company systems would be cut off immediately.
In response to requests for comment, xAI pointed to a post on X stating that it is actively hiring across various roles and intends to expand its specialist AI tutor team by “10X.”
The data annotation unit, the company’s largest team, is responsible for teaching Grok to interpret the world by labeling and contextualizing raw data, the report added.
The move follows the departure of xAI’s chief financial officer, Mike Liberatore, who left the company in late July after just a few months in the role, The Wall Street Journal reported earlier.
Musk launched xAI in 2023 to rival Big Tech in the AI race, criticizing existing players for what he described as excessive censorship and weak safety standards.