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Dell Technologies shares rose on Thursday after Chief Executive Officer Michael Dell said the company is building a \u201cDell AI factory\u201d for Elon Musk\u2019s startup xAI alongside Nvidia.<\/p>\n
\u201cWe\u2019re building a Dell AI factory with Nvidia to power Grok for xAI,\u201d Michael Dell wrote in an X post on Wednesday.<\/p>\n
Musk\u00a0responded<\/a>\u00a0to comments about the post, saying that Super Micro Computer would also be providing servers. Super Micro\u2019s X account replied to Musk with a celebration emoji and a link to its website.<\/p>\n XAI will use Dell\u2019s XE 9680 servers in the factory, a Dell spokesperson said in an email. \u201cOur size, scale and breadth of solutions position us well for large-scale projects like these,\u201d the company said in a statement, adding that the size of its so-called graphics processing clusters allows it to train AI models faster.<\/p>\n A representative for Super Micro didn\u2019t immediately respond to requests for comment and additional details.<\/p>\n We\u2019re building a Dell AI factory with @nvidia<\/a> to power @grok<\/a> for @xai<\/a> @elonmusk<\/a> pic.twitter.com\/2aTYLtCBup<\/a><\/p>\n \u2014 Michael Dell (@MichaelDell) June 19, 2024<\/a><\/p><\/blockquote>\n <\/p>\n Both Dell and Super Micro are increasing their server capacity to win more business from companies building and working with artificial intelligence programs, which require more data processing power. Super Micro announced earlier this week that it plans to add three new facilities in Silicon Valley to support AI growth. Dell said last month that revenue from its servers equipped to handle AI tasks\u00a0more than doubled<\/a>\u00a0last quarter from the period before and its backlog jumped.<\/p>\n \u201cDell\u2019s servers are for Elon Musk\u2019s AI startup xAI, and likely to make up half of server volume, with the rest for Super Micro,\u201d said Bloomberg Intelligence analyst\u00a0Woo Jin Ho<\/a>. \u201cIf the deployment is for Grok 3, which needs 100,000 Nvidia H100 GPUs, the xAI server deal might be worth $3 billion, assuming a price of $1 million per AI-server rack.\u201d<\/p>\n Dell shares rose about 1% to $150.63 at 10:56 a.m. in New York trading after earlier gaining as much as 8.3%. Super Micro rose 8.2% to $995.45 after previously jumping 10%. Nvidia gained 2.5% to $138.94.<\/p>\n Musk launched xAI, an artificial intelligence startup,\u00a0in July 2023<\/a>\u00a0as an answer to OpenAI and its wildly popular chatbot, ChatGPT. Musk was instrumental to OpenAI\u2019s founding, but withdrew his support and warned of the dangers of AI to humanity. The startup launched its ChatGPT competitor Grok\u00a0last November<\/a>\u00a0and\u00a0raised $6 billion<\/a>\u00a0in venture capital funding in May at a pre-money valuation of $18 billion.<\/p>\n<\/div>\n\n
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