Elon Musk’s AI startup xAI has laid off 500 members of its data annotation team, according to internal messages cited by Business Insider. The emails described the move as part of an immediate “strategic pivot,” with the company deciding to accelerate growth in specialist AI tutors while cutting back on generalist tutor roles.
“As part of this shift in focus, we no longer need most generalist AI tutor positions and your employment with xAI will conclude,” the company reportedly wrote.
The layoffs represent roughly one-third of the 1,500-person data annotation workforce responsible for labeling and preparing data used to train xAI’s chatbot, Grok.
When asked for comment, xAI referred to a statement posted on X, the Musk-owned social platform, confirming plans to “immediately surge our Specialist AI tutor team by 10x.” The company also noted that it is actively hiring in areas such as STEM, finance, medicine, and safety.
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