Dell and Nvidia Are Together Building an AI Factory for Elon Musk’s xAI

Dell’s CEO has confirmed on X that the company will be teaming up with Nvidia to build an AI factory for Elon Musk.
Supermicro will also be joining, building half of the racks that will go into the supercomputer xAI is working on.
As a result of this news, the share prices of all three companies involved in the project shot up last week.

Dell and Nvidia are teaming up to build an AI factory for Elon Musk’s xAI. The news was confirmed by the CEO of Dell, Michael Dell, who shared a post on X saying that this initiative will also power Grok, the AI chatbot by xAI.

It’s also well worth noting that just a month ago, xAI announced that it’s planning to build a supercomputer by next year’s fall season.

How Exactly Will Each Company Contribute?

As Elon Musk himself confirmed on X, Dell is going to assemble half of the racks that will be going into the supercomputer that xAI is building. The other half of the unit will be built by Supermicro, a leading server and storage vendor.

Speaking of Nvidia’s involvement, nothing regarding it has officially been revealed but we can make a calculated guess.

Earlier this month, Musk announced that the xAI 100k Nvidia H100 liquid-cooled training cluster will be available in a few months. So, Dell and Supermicro will probably supply these systems.

Nvidia’s Relationship with Musk

Nvidia’s relationship with Elon Musk goes beyond just the H100 liquid-cooled training cluster. Since Musk isn’t happy with this model’s efficiency, he would probably be aiming for a cluster of around 300,000 Nv B200s, which is the equivalent of 37,500 nodes. This would be connected via Nvidia’s 800 Gb/s ConnectX-8 NICs, which is expected to roll out next summer.

Elon Musk also recently reassigned 12,000 H100 GPUs to xAI, which were initially slated for Tesla. This goes on to show that he is going all in with Nvidia for his AI firm.

It’s well worth noting, though, that the reassignment doesn’t mean that Nvidia won’t be working on Tesla cars anymore. Nvidia GPUs will still be used in manufacturing Tesla’s Full Self-Driving system.

In Other News

While on one hand, Elon Musk is making fresh partnerships with Dell, Nvidia and Supermicro, on the other hand, his relationship with OpenAI, is worse than ever—perhaps to the point of no absolution.

Elon Musk filed a lawsuit against OpenAI for apparently digressing from its original motive and breaching the “foundation agreement” they had. The lawsuit was, however, dropped for unexplained reasons after OpenAI challenged it—probably because Elon finally realized he couldn’t win it after OpenAI released his emails.

Interestingly, though, this might bring Elon Musk closer to Ilya Sutskever’s Safe Superintelligence Inc. (SSI). Ilya was one of the co-founders of OpenAI, and he recently resigned from OpenAI.

Rumors say that Ilya’s, as well as a few more top officials’, sudden departure was because of how Sam Altman and OpenAI are handling AI developments. They could no longer trust that the company would behave responsibly and believe that Sam Altman is pushing AI and AGI “too far, too fast.”

So, there might be a collab between SSI and xAI at some point down the line, as Elon is definitely not going to work with OpenAI anymore after what happened between them.

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