Elon Musk Diverts AI Chip Resources To xAI & X Ahead Of Tesla: Report

In an unprecedented development that has echoed a bustle, recent reports surfacing across markets have spotlighted that Elon Musk has mandated Nvidia, the GPU manufacturing giant, to send AI chips to his firms xAI and X ahead of Tesla. This decision raises the question: Is Tesla losing its edge? Or is this a strategic mover that aligns with the rising demand for AI-related technologies?

xAI, Elon Musk’s AI startup, and X, formerly known as Twitter, a social media platform championing free speech, are the beneficiaries of the diverted AI chip resources. This resource diversion has sparked intense interest and speculation within the industry, underscoring the significance of the decision.

A Closer Look Into The Report

According to CNBC, a recent email by a senior staff member at Nvidia suggests that Musk overstated Tesla’s chip procurement to shareholders. Further, correspondence from Nvidia staffers stated that Musk funneled a significant amount of AI processors booked for Tesla to X, the platform that boasts the generative AI chatbot Grok, launched by Elon Musk’s xAI.

Meanwhile, in an April post on X, Musk pointed out that “Tesla will spend around $10B this year in combined training and inference AI, the latter being primarily in car.” The decision to divert resources contradicts this statement.

Tesla Inc.’s Common Stock (TSLA) saw a 0.84% dip in the pre-market hours, piquing investor interest amid the automobile company’s abovementioned blunder. The stock price stood at $174.81.

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Musk’s Past Resource Diversion Chronicles

A December memo from Nvidia claimed that Musk prioritized X over Tesla by redirecting 12k of shipped H100 GPUs to X instead of Tesla. “In exchange, original X orders of 12k H100 slated for Jan and June to be redirected to Tesla.”

The emergence of these chronicles has enigmatically shrouded Musk’s plans for AI development across multiple firms run by the American entrepreneur.

Nvidia and Musk are yet to reveal an official statement surrounding the matter, although the abovementioned chronicle underlines significance of AI development.

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