Elon Musk is buying Nvidia hardware even as Tesla aims to build an AI competitor

In November 2023, in a comprehensive meeting with employees, Nvidia CEO Jensen Huang was asked if the company would follow suit apple And Disney and suspended its advertising on X due to high levels of anti-Semitism and other hate speech on the platform.

X's owner, Elon Musk, said earlier that month that he had approved a post on the site that accused “Jewish communities” of pushing “anti-white hate.” Several brands — including Disney and Apple — moved quickly to pause their advertising campaigns.

Huang's response was firm but diplomatic, according to the people who were listening to the meeting but asked to remain anonymous because they were not authorized to speak to the press. He said the chipmaker has not announced the X in a very long time and has no plans to do so. However, Huang also stressed that Nvidia would never make public statements against any other company.

Huang did not comment at the time on any details regarding Nvidia's growing comfort with Musk's business empire.

Nvidia is seeing increasing demand for graphics processing units (GPUs) and related devices and services, a boom that has pushed the company's market value past $2 trillion. Nvidia products, including new accelerator chips, provide computing power for generative AI workloads, robotics, research projects and data centers.

Revenue last quarter jumped a whopping 265% to $22.1 billion, and last year Nvidia surpassed Intel in total sales.

Musk has made promises that his companies will develop cutting-edge AI products, and doing so will require purchasing a lot of Nvidia technology.

Their cozy relationship was on display this week at Nvidia's annual GTC conference in San Jose, California. The event, which attracted nearly 16,000 attendees including celebrities like Ashton Kutcher and Kendrick Lamar, featured two sessions featuring XAI leaders, Musk's startup officially unveiled in July 2023.

Christian Szegedi, co-founder and research scientist at xAI who previously worked at Google, spoke in a fireside chat with Bojan Tunguz, a data scientist at Nvidia. Another co-founder and research engineer at xAI, Igor Babushkin, an OpenAI and Google veteran, gave an overview of how Musk's startup is using Nvidia GPUs to help “accelerate the training and inference of their Grok model,” referring to software Chatbot for startups. .

In Nvidia's Monday press release announcing the launch of Blackwell AI chips, Musk was quoted as saying: “There is currently nothing better than NVIDIA hardware for AI.”

Musk, who helped create OpenAI before the public split with CEO Sam Altman and other founders, launched xAI to develop AI models and software products.

Meanwhile, the maker of his electric car Tesla It has spent years working on artificial intelligence software to turn its cars into self-driving vehicles. It is also now developing the Tesla Bot, or Optimus, a humanoid robot.

While the vast majority of Tesla's revenue comes from its automotive business, Musk often encourages shareholders to think about it differently. In January, he said in a post on X: “Tesla is an AI/robotics company and appears to many to be a car company.”

Tesla first discussed plans to build a “Dojo supercomputer” at an AI Day presentation in August 2021. The goal of Dojo was to process and train AI models using massive amounts of video and data captured by Tesla vehicles.

Nvidia is at the heart of its AI efforts. Last August, former Tesla AI engineer Tim Zaman posted on X that Tesla's AI cluster, built using 10,000 Nvidia's H100 chips, was ready to go.

Musk said in a post on X in January that while the Dojo supercomputer cost $500 million to build, Tesla would spend more than that on Nvidia hardware this year. “The competitive stakes in AI are at least several billion dollars a year at this point,” he added.

On Tesla's fourth-quarter earnings call in January, an analyst asked Tesla executives for an update on Dojo, and whether the company had “sufficient supplies of Nvidia GPUs needed to train the system.”

Musk said Tesla was “following the dual path of Nvidia and Dojo,” seemingly indicating that it is building Dojo without Nvidia's technology but using it elsewhere. Musk described Dojo as “a long shot worth taking because the payoff is potentially very high. But it's not something with a high probability.”

inspiration Founder Larry Ellison, a close friend of Musk and a former Tesla board member and investor in Musk demands.

“Boy, do they want a lot more GPUs than we've given them?” Ellison said. “We gave them quite a few, but they wanted more and we are going to get more from them.”

Although Musk and Huang have a long-standing relationship and now do more work together than ever before, the relationship hasn't always seemed cordial.

Last June, Musk went so far as to call Nvidia a monopoly, in response to a post on

Musk wrote that competitive chips were in development, and that “NVIDIA will not have a monopoly on large-scale training and reasoning forever.”

These statements failed to provoke Huang.

Speaking at the New York Times' DealBook Summit a few months later, Huang credited Musk and OpenAI with the decision to develop Nvidia's first AI supercomputer, the DGX system, starting in 2012.

Huang said it took Nvidia about five years to perfect and ship the supercomputer, which he personally delivered to Musk for use by OpenAI.

“Elon saw it and said, ‘I want one of those’ — and told me about OpenAI,” Huang said onstage. “I delivered the world's first artificial intelligence supercomputer to OpenAI that day.”

A Nvidia spokesman declined to comment. Tesla and xAI did not respond to requests for comment.