Dell Nears USD 5 Billion AI Server Deal with xAI: Report

Reported by Kripa B February 17th, 2025 at 10:14 am

Dell Technologies to Deliver Nvidia-Powered AI Servers as xAI Expands Its Colossus Supercomputer.

Highlights

The servers will be equipped with Nvidia’s GB200 semiconductors and are expected to be delivered this year.
xAI is expanding its Colossus supercomputer in Memphis, scaling from 100,000 to over one million GPUs.
Nvidia, Dell, and Super Micro are expected to set up operations in Memphis to support AI growth.

Dell Technologies (Dell) is finalising a deal worth over USD 5 billion to supply Elon Musk's AI startup, xAI, with servers optimised for artificial intelligence (AI) workloads. Dell is expected to deliver servers equipped with Nvidia's GB200 semiconductors to xAI this year, Bloomberg News reported on February 15, 2025, citing sources.

Also Read: xAI Raises USD 6 Billion in Series C Funding

AI Chips to Power xAI’s Expansion

Some details are still being discussed and may change, the report added.

The deal aligns with xAI's expansion of its Memphis-based Colossus supercomputer, which aims to scale from 100,000 to over one million GPUs. Nvidia, Dell, and Super Micro are expected to establish operations in Memphis to support this growth.

Also Read: HPE Secures USD 1 Billion AI Server Deal with X: Report

Demand for AI Infrastructure

The surge in demand for AI infrastructure has driven major investments, with Hewlett Packard Enterprise recently securing a USD 1 billion deal to supply AI servers for Musk's social media platform, X. Dell and other AI hardware providers continue to benefit from this trend as companies race to build high-performance computing systems.

Reported By

Kripa B

Kirpa B is passionate about the latest advancements in Artificial Intelligence technologies and has a keen interest in telecom. In her free time, she enjoys gardening or diving into insightful articles on AI.