Elon Musk’s xAI Partners with Nvidia and Saudi Arabia

On Wednesday, Elon Musk’s xAI and Jensen Huang’s Nvidia unveiled a partnership with a Saudi Arabian state-run AI company to establish a large-scale AI data center in the Persian Gulf. This center will reportedly use up to 500 megawatts of electricity, marking xAI’s most significant site outside the United States.

As part of this initiative, Musk’s xAI chatbot, Grok, is set to be introduced throughout Saudi Arabia. However, the specific financial details of the agreement have not been disclosed.

In related news, the U.S. has seemingly paved the way for Saudi Arabia to purchase American semiconductors during Crown Prince Mohammed bin Salman’s recent visit to Washington, D.C. Previously, U.S. authorities restricted sales of AI chips to the Middle East, hindering the crown prince’s ambitions to transform the resource-rich nation into a technology hub.

While Musk is focused on developing costly data centers, including the ambitious Colossus supercomputer based in Memphis, Tennessee, this new contract has been in the planning stages for several months. According to reports, progress was stunted due to existing export restrictions.

This isn’t Musk’s first collaboration with the region; previously, Saudi Arabia had financed his $44 billion purchase of Twitter, which he later rebranded as X.

“The future of intelligence will be engineered through large-scale, efficient computing combined with cutting-edge AI models,” Musk stated. He also emphasized that leveraging local capabilities would expedite the development of these technologies in Saudi Arabia.

Additionally, Tarek Amin, CEO of a new company named Humane—backed by the kingdom’s $1 trillion sovereign wealth fund—also announced partnerships with Cisco and AMD. Humane aims to build up to 1 gigawatt of AI infrastructure by 2030, similar to the output of a large power plant.

Crown Prince Mohammed is intent on positioning Saudi Arabia as a key player in the global AI market, capitalizing on the nation’s vast energy resources. AI data centers are increasingly recognized as pivotal in the race for artificial intelligence dominance, with most currently based in the U.S., Europe, and China.

Humane has set an ambitious goal to support 6% of global AI workloads in the near future. Despite ongoing concerns over human rights in the region, American tech firms have sought partnerships in the Middle East to finance expensive AI infrastructure projects.

Notably, OpenAI has recently inked a deal with a UAE government-backed firm, while Anthropic has drawn support from Qatar’s sovereign wealth fund. During a White House dinner hosted by President Trump, the crown prince was surrounded by various tech leaders, including Musk.