Elon Musk's xAI startup to purchase 100,000 Nvidia GPUs, boosting Nvidia stock

From NASDAQ.: 2024-06-01 08:11:00

Elon Musk’s AI start-up xAI closed a $6 billion financing round to build a language model called Grok. The funding will be used to purchase 100,000 Nvidia H100 GPUs for a supercomputer, validating Nvidia’s chips. Nvidia’s stock rose 8% post-announcement, but consider long-term trends – revenue and net income tripled over the past year.
Nvidia’s partnership with xAI presents a major opportunity for the company. Tesla currently uses Nvidia’s chips in its supercomputers for autonomous driving software. With demand for Nvidia’s chips high, xAI’s planned purchase of 100,000 GPUs could mean $4 billion in revenue for Nvidia. The secular AI trend indicates continued growth for Nvidia as a leader in the chip market.



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