Elon Musk appears to have shifted a major portion of his AI chip resources to X and xAI rather than Tesla. TSLA share prices dipped as the news made headlines.

Recent reports surfacing across markets have highlighted an unprecedented development: Elon Musk has mandated Nvidia, the GPU manufacturing titan, to provide AI chips to his firms xAI and X ahead of Tesla.
However, this decision raises the question: Is Tesla losing its edge? Or is this a strategic mover that aligns with the rising demand for AI-related technologies?
xAI, an AI startup founded by Elon Musk, and X, formerly Twitter, a social media platform that advocates for free expression, are the recipients of the AI chip resources that were redirected.
This resource diversion has prompted widespread interest and speculation in the industry, highlighting the decision’s significance.
An Analysis Of The Report
According to CNBC, a recent email from a top Nvidia employee indicates that Musk inflated Tesla’s chip procurement to shareholders.
Additionally, correspondence from Nvidia employees revealed that Musk redirected a substantial quantity of AI processors that were originally reserved for Tesla to X, the platform where Elon Musk’s xAI introduced the generative AI chatbot Grok.
Meanwhile, in an April post on X, Musk pointed out that “Tesla will spend around $10B this year in combined training and inference AI, the latter being primarily in car.”
The decision to redirect resources contradicts this claim.
Tesla Inc.’s Common Stock (TSLA) fell 0.84% in pre-market trading, piqueing investor interest after the vehicle company’s aforementioned gaffe.
The stock price stood at $174.81.
Musk’s Past Resource Diversion Chronicles
Musk allegedly prioritized X over Tesla by redirecting 12,000 shipped H100 GPUs to X rather than Tesla, according to a December memo from Nvidia.
“In exchange, original X orders of 12k H100 slated for Jan and June to be redirected to Tesla.”
Moreover, the emergence of these chronicles has enigmatically shrouded Musk’s plans for AI development across multiple firms run by the American entrepreneur.
Nvidia and Musk have not yet issued an official statement regarding the matter; however, the aforementioned chronicle emphasizes the critical nature of AI advancement.