xAI, the artificial intelligence venture led by Elon Musk, has purchased a substantial one-million-square-foot site in Southwest Memphis to enhance its AI data center operations, as reported in a press statement issued by the Memphis Chamber of Commerce.
This new acquisition will provide the necessary infrastructure to bolster xAI’s current data center in Memphis.
“With this property acquisition, xAI is committed to leading the charge in AI innovations, right here in Memphis,” stated Brent Mayo, senior site manager at xAI, in a press release.
It remains unclear whether this development is associated with a previously disclosed leasing deal for a 522-acre parcel in Memphis.
xAI is actively seeking advanced AI hardware. Reports indicate that the company has recently completed construction on a second data center in Atlanta, investing $700 million in chips and other technological assets. Furthermore, it has secured a contract with Dell for $5 billion worth of GPU-rich servers.
The data centers are utilized for training and operating xAI’s suite of AI models known as Grok. Plans are in place to enhance the primary facility in Memphis, dubbed Colossus, to accommodate 1 million Nvidia GPUs this year, a significant increase from last year’s 100,000.
Some local residents have voiced concerns regarding xAI’s expansion in Memphis, claiming it may overload the power grid and exacerbate the air quality issues in the area. In an effort to assuage these concerns, xAI has offered discounted Tesla batteries to the local utility and has established a water recycling facility.
To support its AI infrastructure endeavors, xAI is reportedly considering a $10 billion funding round, which would place the company’s valuation at $75 billion. This follows the completion of its previous funding round, which raised $6 billion in late 2024.
Compiled by Techarena.au.
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