Investing.com -- Shares of JetAI soared 29.1% following the announcement of a strategic agreement to sell its aviation assets to flyExclusive in an all-stock deal; as well as the announcement of intent to build its first AI datacenter. The transaction, which involves spinning off these assets into a new entity that will then be acquired by flyExclusive, has sparked optimism among investors, as it aims to position the company for growth in both the competitive private aviation market and the burgeoning field of artificial intelligence (AI).

The deal, revealed in a recent company press release, allows JetAI shareholders to retain their existing stock and also receive new shares in flyExclusive. This development comes on the heels of JetAI's efforts to expand its aviation offerings, including a previous agreement for a fleet of CJ4 aircraft and exploration of the super-mid category of private jets, which proved to be a catalyst for the current strategic move.

JetAI has been at the forefront of integrating AI into private aviation, developing technologies like Ava, an agentic model, and CharterGPT for streamlining private travel. The company has also introduced Reroute AI and DynoFlight AI, aimed at optimizing empty flight routes and reducing carbon emissions. However, challenges such as computational resource limitations have prompted JetAI to pivot towards AI data center development, leveraging the expertise of its leadership team with backgrounds from SAP and Facebook (NASDAQ: META ).

The pivot to AI data center construction is driven by financial logic, as outlined by the company. With the cost of building data centers and the potential returns on investment, JetAI is positioning itself to capitalize on the high demand for AI infrastructure. The company has already signed a letter of intent for a 50-megawatt data center project, part of a larger plan for a one-hundred-and-twenty-acre campus that could support up to a gigawatt of capacity.

Over the past year, JetAI has focused on streamlining its capital structure, including a warrant exchange offer, direct stock offerings, a reverse stock split, and a share repurchase authorization. The company has also launched a fractional jet ownership program, which flyExclusive will assume as part of the proposed transaction.

The move to sell its aviation assets and focus on AI data center development marks a significant shift for JetAI, which aims to become the only public AI data center development business in the U.S. The company's management expresses a cautious yet optimistic outlook for the future, emphasizing the immense opportunities within the AI sector.

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