Elon Musk's xAI Acquires Memphis Property - 1 Million Sq Ft
xAI Expands Memphis Data Center Presence
xAI, the artificial intelligence company founded by Elon Musk, has secured a 1 million-square-foot property in Southwest Memphis. This acquisition, as detailed in a press release from the Memphis Chamber of Commerce, is intended to bolster the company’s AI data center capabilities.
The newly acquired land will serve as a location for supporting infrastructure. It will work in conjunction with xAI’s currently operational data center within Memphis.
Statement from xAI
“This property acquisition by xAI guarantees our continued leadership in AI development, specifically within the Memphis area,” stated Brent Mayo, Senior Site Manager at xAI.
The connection between this expansion and a prior announcement concerning a 522-acre lease in Memphis remains unclear at this time.
Significant Investment in AI Hardware
xAI is demonstrating a substantial demand for advanced AI hardware. Recent reports indicate the company recently completed a second data center in Atlanta. This facility is equipped with approximately $700 million in chips and related equipment.
Furthermore, a $5 billion agreement has been established with Dell for the procurement of servers heavily populated with GPUs.
Grok Model Training and Colossus Upgrade
The data centers operated by xAI are crucial for both the training and execution of its Grok family of AI models. Plans are underway to significantly upgrade the primary Memphis facility, known as Colossus.
This upgrade will increase the GPU capacity to 1 million Nvidia GPUs, a substantial increase from the 100,000 GPUs present last year.
Community Concerns and xAI’s Response
Some local residents have voiced concerns regarding xAI’s ongoing expansion in Memphis. These concerns center around potential strain on the power grid and a possible decline in local air quality.
In an effort to address these concerns, xAI has provided discounted Tesla batteries to the local utility provider. Additionally, the company has constructed a water recycling plant.
Fundraising Efforts
To finance its ambitious AI infrastructure projects, xAI is reportedly exploring a $10 billion fundraising round. Successful completion of this round would value the company at $75 billion.
xAI’s previous funding round, which reached $6 billion, was finalized in late 2024.
