Elon Musk’s artificial intelligence company has made one of its biggest cuts yet. xAI lays off more than 500 workers from its data annotation team in a sudden overnight move. The layoffs were confirmed through internal emails, which showed the company is shifting its focus toward specialist AI tutors.
In the message, employees were told that xAI would “accelerate the expansion” of its specialist tutors while scaling back general tutor roles. This means most generalist AI tutor positions are no longer required. Workers were informed that their access to systems would end immediately, though pay would continue until the end of their contracts or November 30.
The data annotation team, which xAI lays claim to as its largest group, played a critical role in training Grok, the company’s flagship chatbot. Members labeled and sorted vast amounts of data to help improve the system’s knowledge and performance. Until recently, the team had more than 1,500 members, but screenshots revealed the number dropped to around 1,000 by Friday night.
Interestingly, the layoffs came just as xAI publicly announced plans to grow its specialist tutor team “by 10X.” The company is now hiring experts in STEM, medicine, finance, coding, and other fields.
The shake-up followed days of internal tension. Workers were asked to complete sudden tests on a wide range of topics, from chatbot safety to Grok’s behavior. Some team members expressed frustration at the timing and secrecy of the process.
Although xAI has not disclosed the exact figure, reports suggest the cuts affected a large share of the annotation team. This major shift highlights how the company plans to refine Grok with fewer generalists and more domain experts. For many former employees, the restructuring has brought an abrupt end to their time at the company.
In other news read more about: Elon Musk’s xAI Seeks $6 Billion to Rival OpenAI
