Fri Mar 28 08:30:00 UTC 2025: ## xAI Launches Image Generation API, Eyes $10 Billion Funding Round

**SAN FRANCISCO** – Elon Musk’s artificial intelligence company, xAI, has entered the competitive image generation market with the launch of a new API featuring its grok-2-image-1212 model. The API, accessible since October 2024, allows users to generate up to 10 JPG images per request based on text prompts, at a cost of $0.07 per image (limited to five requests per second).

While the model currently lacks adjustable quality, size, and style options, and prompts are subject to revision by a chat model, xAI’s entry into the market positions it competitively against rivals like Black Forest Labs ($0.05/image) and Ideogram ($0.08/image).

This move is seen as a strategic step for xAI, which is reportedly seeking a significant funding boost. The company is in talks with investors for a potential $10 billion funding round, aiming for a $75 billion valuation. This funding would likely fuel further development of flagship models like Grok 3 and support xAI’s expanding infrastructure, including a recently acquired generative AI video startup and the expansion of its Memphis-based data center. The company’s foray into image generation suggests a concerted effort to diversify revenue streams as it scales its operations.

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