Nvidia revealed that Elon Musk is redirecting his AI chip orders for Tesla to X and xAI. The giant semiconductor firm shared this detail after Elon Musk boasted that he would increase the AI chipsets he purchases from Nvidia for Tesla.

Nvidia Says Elon Musk Redirects AI Chip Orders for Tesla To X, xAI

During a Tesla Q1 earnings call in April, Elon Musk said that his EV firm would drastically increase the number of active H100s it ordered from Nvidia. Specifically, the billionaire told his investors they will increase their AI chip orders from 35,000 to 85,000 before 2024 ends.

According to NBC News, he also posted on X that Tesla would spend around $10 billion in combined inference and training artificial intelligence. However, this isn't the case in Nvidia senior employees' emails. Based on their email messages, what Musk said to their Tesla investors was an exaggeration. 

"Elon prioritizing X H100 GPU cluster deployment at X versus Tesla by redirecting 12k of shipped H100 GPUs originally slated for Tesla to X instead," stated Nvidia's email messages via Reuters.

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Should Tesla Investors Worry?

Tesla investors should worry about Elon Musk's focus on Nvidia AI chip orders to X and xAI. This is because the EV company still faces issues as its sales decline.

Tesla's declining sales are due to its aging lineup of EV models and the increasing competition in the electric car market.

Another factor contributing to Tesla's decreasing sales is its reputation, which has suffered in the U.S. due to accidents linked to FSD and other issues.

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