Elon Musk’s AI startup, xAI, has reportedly laid off at least 500 employees from its data annotation team, which plays a crucial role in training the company’s Grok chatbot, according to Business Insider.
The layoffs were communicated via email on Friday night, informing staff that the team of generalist AI tutors would be cut. Affected employees were assured pay through the end of their contracts or until November 30, though their access to company systems was immediately revoked.
In response, xAI highlighted a post on X stating it is actively hiring for multiple roles and plans to expand its specialist AI tutor team by “10X.” The data annotation unit, the company’s largest, is responsible for teaching Grok to interpret information by labeling and contextualizing raw data.
The move follows the departure of xAI CFO Mike Liberatore, who left the company in late July after only a few months in the role, The Wall Street Journal reported. Musk founded xAI in 2023 to challenge Big Tech in the AI sector, criticizing existing players for excessive censorship and weak safety standards.
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