Dell Nears $5 Billion AI Server Deal with Elon Musk’s xAI

The reported agreement would see Dell provide AI-optimized servers equipped with Nvidia GPUs to support xAI’s growing computational needs.

Dell shares rose over 3% on reports of a potential $5 billion deal with Elon Musk's xAI for AI-optimized servers.
The servers, featuring Nvidia GB200 GPUs, are expected to bolster xAI's AI model development and computational capabilities.
Dell has seen rapid growth in its AI server business, reporting $3.6 billion in quarterly AI server orders and a 10% year-over-year revenue increase to $24.37 billion in November.
xAI recently secured $6 billion in funding, reportedly to invest in GPU acquisitions and expand its AI infrastructure.
The reported deal highlights the increasing demand for AI-specific hardware and Dell’s strategic focus on AI-driven technologies.