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Dell Technologies and Super Micro Computer both saw their stocks jump Thursday morning, a day after announcing a partnership with Elon Musk’s artificial intelligence startup, xAI.
Dell stock was up about 7% Thursday morning, before falling below 1%, and is up 101% so far this year. Super Micro Computer stock was up about 5.5% and has risen about 239% year-to-date.
Dell CEO Michael Dell announced Wednesday on X that the tech giant is building a Dell AI factory with AI chipmaker Nvidia to power xAI’s Grok chatbot. Musk responded in another post on X that Super Micro Computer is building half of the servers for xAI’s supercomputer.
Super Micro announced earlier this week it is adding three new manufacturing facilities in Silicon Valley “to support the growth of AI.” And in February, Dell beat earnings expectations in its fourth-quarter results, which it said were driven by demand for AI optimization in its server business.
Earlier this month, Musk chose Memphis, Tennessee for xAI’s “gigafactory.” The factory could one day be the “largest multi-billion dollar investment in the city of Memphis’s history,” Ted Townsend, president of the Greater Memphis Chamber, told reporters. Musk and xAI have been working with Memphis officials since March to make plans for the facility, Townsend said.
In May, Musk pitched investors on xAI’s plans to build a supercomputer to power its AI chatbot, Grok, The Information reported. In an internal presentation seen by the new outlet, Musk said he wanted the supercomputer to be up and running by next fall. He also reportedly said xAI was considering a partnership with Oracle to build the supercomputer.
xAI raised $6 billion in a Series B funding round in May that included investors such as Andreessen Horowitz, Sequoia Capital, and Saudi Arabia’s Public Investment Fund. The company open-sourced its ChatGPT rival, Grok, in March.