- Dell is close to securing an AI server agreement of $ 5 billion with Elon Musk’s Xai
- The servers containing NVIDIA GB200 chips may support XAIS Supercomputer
- Analysts predict that Dell’s AI server revenue could hit $ 14 billion in 2026
We recently reported that HPE had beaten supermicro and dell technologies to win a $ 1 billion contract to deliver servers optimized for AI work for Elon Musk’s X, potentially for Power GROK, the social network AI -Chatbot.
At the end of 2024, X announced that it was rolling out of the FLOK 2 out to all users for free and that losing to HPE would have been a big battle for Dell, which along with Supermicro offered to deliver the equipment but in the end was Failed.
But if a new report from Bloomberg Is exactly, the iconic computer manufacturer could be on the verge of winning an even greater contract from one of Musk’s other ventures, Xai.
Memphis tied?
The report says Dell is close to ending an agreement worth over $ 5 billion to deliver AI-focused servers equipped with NVIDIA GB200 chips. Some aspects are still being prepared, sources who are familiar with the discussions told the news site, but if everything goes – and it will certainly – the servers are set to be delivered later in 2025.
Elon Musk said earlier, “Table Stakes to be competitive in AI is at least several billion dollars a year at this time,” and he obviously pays to play.
What the servers are for is not reported, but it is very likely that most people, if not all of them, will be for XAI’s supercomputer project, known as “Colossus”, which is built in Memphis using a mixture of Dell and Supermicro servers. In all accounts, Dell has been very eager to deliver the rest of the servers to finish the job.
This agreement with XAI will “firmly establish the company as a leading AI server provider and increase sales, although the impact on profitability is less clear,” Bloomberg Intelligence Analyst Woo Jin Ho noticed.
“Analysts expect Dell to have sent more than $ 10 billion of AI servers in the financial year ending last month, projecting the value to jump to $ 14 billion in the financial year ending in January 2026,” Bloomberg Added, and notes that Dell is set to report its fiscal earnings in the fourth quarter of February 27.
