Elon Musk purchasing Nvidia hardware even as Tesla intends to develop AI competitor

In November 2023, at an all-hands conference with workers, Nvidia CEO Jensen Huang was asked whether the business would follow the lead of Apple and Disney and suspend its marketing on X due to increasing levels of antisemitism and other hate speech on the platform.

X owner Elon Musk stated previously that month that he concurred with a post on the website that implicated “Jewish communities” of pressing “hatred against whites.” Numerous brand names– Disney and Apple amongst them– moved rapidly to pause their advertising campaign.

Huang’s reaction was firm however diplomatic, according to individuals who were listening to the conference however asked not to be called due to the fact that they weren’t licensed to speak with journalism. He stated the chipmaker had not marketed on X in a long time and had no strategies to do so. However, Huang likewise stressed that Nvidia would never ever reveal declarations versus another organization.

Left out of Huang’s commentary at the time was any information relating to Nvidia’s increasing comfort with Musk’s organization empire.

Nvidia is seeing skyrocketing need for its graphics processing systems (GPUs) and associated hardware and services, a boom that’s raised the business’s market cap well past $2 trillion. Nvidia’s items, consisting of brand-new accelerator chips, supply calculating power for generative expert system work, robotics, research study and information center tasks.

Revenue in the current quarter leapt a tremendous 265% to $221 billion, and in 2015 Nvidia gone beyond Intel in overall sales.

Musk has actually made guarantees that his business will establish advanced AI items, and doing so needs purchasing up a great deal of Nvidia’s innovation.

Their relaxing relationship was on screen today at Nvidia’s yearly GTC conference in San Jose,California The occasion, which drew in approximately 16,000 participants consisting of celebs like Ashton Kutcher and Kendrick Lamar, had 2 sessions including leaders of xAI, the start-up Musk officially exposed in July 2023.

Christian Szegedy, a co-founder and research study researcher at xAI who formerly operated at Google, spoke at a fireside chat with Bojan Tunguz, an information researcher atNvidia Another co-founder and research study engineer from xAI, Igor Babuschkin, a veteran of OpenAI and Google, offered a summary of how Musk’s start-up is utilizing Nvidia GPUs to assist “accelerate training and inference of their Grok model,” describing the start-up’s AI chatbot.

In Nvidia’s news release on Monday revealing the launch of its Blackwell AI chips, Musk was estimated stating, “There is currently nothing better than NVIDIA hardware for AI.”

Musk, who assisted produce OpenAI before a public split with CEO Sam Altman and other creators, introduced xAI to establish AI designs and software.

Meanwhile, his electrical automobile maker Tesla has actually invested years dealing with AI software application to turn its automobiles into self-governing cars. It’s likewise now establishing the Tesla Bot, or Optimus, a humanoid robotic.

While the huge bulk of Tesla’s income originates from its automobile organization, Musk frequently motivates investors to think about it in a different way. In January he stated, in a post on X, “Tesla is an AI/robotics company that appears to many to be a car company.”

Tesla very first gone over strategies to develop a “Dojo supercomputer” at an AI Day discussion in August2021 The go for Dojo was to procedure and train AI designs with substantial quantities of video and information recorded by Tesla cars.

Nvidia is at the heart of its AI efforts. Last August, previous Tesla AI engineer Tim Zaman published on X that a Tesla AI cluster, constructed utilizing 10,000 of Nvidia’s H100 chips, was prepared to go live.

Musk stated a post on X in January that while a Dojo supercomputer expense $500 million to develop, “Tesla will spend more than that on Nvidia hardware this year.” He included, “The table stakes for being competitive in AI are at least several billion dollars per year at this point.”

And on Tesla’s fourth-quarter earnings call in January, an analyst asked Tesla executives to give an update on Dojo, and whether the company had a “sufficient supply of Nvidia GPUs needed for the training of the system.”

Musk said Tesla was “pursuing the dual path of Nvidia and Dojo,” seemingly implying that it’s 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 that is a high probability.”

Oracle founder Larry Ellison, a close friend of Musk’s, former Tesla board member and investor in X, said in December on his company’s earnings call that xAI had secured Nvidia GPUs through Oracle to create the first version of Grok, but that Oracle wasn’t able to meet Musk’s demands.

“Boy, do they want a lot more GPUs than we gave them,” Ellison said. “We gave them quite a few, but they wanted more and we are in the process of getting them more.”

While Musk and Huang have a longstanding connection and are now doing more business together than ever, the relationship hasn’t always appeared friendly.

Last June, Musk went so far as to call Nvidia monopolistic, in reaction to a post on X that implicated Nvidia of “spiking the price” of its GPUs, which it might do due to the fact that of the supply scarcity.

Musk composed that competitive chips remained in advancement, which “Nvidia will not have a monopoly on large-scale training & inference forever.”

The remarks stopped working to provoke Huang.

Speaking at The New York Times’ DealBook top a couple of months later on, Huang credited Musk and OpenAI for the choice to establish Nvidia’s very first AI supercomputer, the DGX system, drawing back in 2012.

Huang stated it took Nvidia about 5 years to ideal and deliver the supercomputer, which he personally provided to Musk for usage by OpenAI.

“Elon saw it, and he goes, ‘I want one of those’ — he told me about OpenAI,” Huang stated on phase. “I delivered the world’s first AI supercomputer to OpenAI on that day.”

A representative for Nvidia decreased to comment. Tesla and xAI didn’t react to ask for remark.