Elon Musk: xAI expects to continue purchasing GPUs from Nvidia and AMD

Elon Musk: xAI expects to continue purchasing GPUs from Nvidia and AMD

Elon Musk's AI startup, xAI, is set to continue its significant purchases of graphics processing units (GPUs) from Nvidia and AMD. The company is currently in the process of scaling its Colossus supercomputer, which is designed to train its large language model (LLM) Grok to compete with models like OpenAI's ChatGPT.

xAI has been using Nvidia's GPUs extensively, starting with 100,000 chips and scaling up to 200,000. A recent report suggests that the next phase, Colossus 2, could require up to 1 million chips, potentially costing nearly $40 billion. This estimate is based on Nvidia's average chip prices, which range between $30,000 and $40,000 [2].

In addition to Nvidia, xAI is also expected to purchase GPUs from AMD. While the exact details of the AMD purchases are not specified, the growing demand for GPUs in the AI sector suggests that AMD could also benefit from this trend.

The increased demand for GPUs from xAI is part of a broader trend in the AI industry. As more companies develop large language models and other AI applications, the need for powerful computing resources has grown significantly. This increased demand is likely to benefit both Nvidia and AMD, as well as other companies in the GPU market.

While the exact details of xAI's GPU purchases from AMD are not yet known, the company's commitment to scaling its Colossus supercomputer suggests that it will continue to be a significant customer for both Nvidia and AMD. This trend is likely to have a positive impact on the financial performance of both companies, as well as the broader AI industry.

References:
[1] https://finance.yahoo.com/news/did-elon-musk-just-nvidia-210000941.html
[2] https://economictimes.indiatimes.com/news/international/us/chips-down-but-not-out-nvidia-could-receive-business-worth-a-whopping-40-billion-from-elon-musk-heres-the-breakdown/articleshow/121239148.cms