Dell, Nvidia and SMCI collaborate to power Musk's Grok AI factory

June 20, 2024 6:55 AM EDT - Dell Technologies Inc (NYSE: DELL), led by CEO Michael Dell, has announced a partnership with NVIDIA Corporation (NASDAQ: NVDA) to construct an AI Factory designed to boost the capabilities of Grok, an AI model developed by Elon Musk's company, xAI.

Grok, a generative AI chatbot, was created as a response to the increasing popularity of ChatGPT, a product of OpenAI, which Musk co-founded. Grok, which is based on a large language model, has the ability to process a broad range of visual information, including documents, diagrams, charts, screenshots, and photographs, in addition to its robust text capabilities.

xAI's Grok-1.5V, the first-generation multimodal model, was introduced in April. The company has emphasized Grok's ability to understand the physical world, with the AI model reportedly outperforming its competitors in the RealWorldQA benchmark, a measure of real-world spatial understanding.

In response to a query about another collaborator, Musk replied "SMC" - an acronym for Super Micro Computer, a server manufacturer based in San Francisco.

Super Micro Computer Inc (NASDAQ: SMCI), renowned for its strong relationships with chip companies like Nvidia and its innovative liquid-cooling technology, has confirmed its partnership with xAI to Reuters.

Following the news, shares of both Dell and SMCI rallied, climbing more than 3%.

Earlier in June, xAI announced plans to construct a supercomputer, termed the "Gigafactory of Compute," anticipated to be operational by fall 2025. This venture is expected to be a collaborative effort with Oracle (NYSE: ORCL) and is aimed at enhancing the capabilities of the Grok AI chatbot.

The upcoming supercomputer is set to utilize up to 100,000 Nvidia's H100 GPUs based on the Hopper architecture, potentially making it four times larger than the existing largest GPU clusters. This move by Musk is seen as an attempt to outclass rival GPU clusters in terms of size and capabilities.

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