HPE Secures $1 Billion AI Server Deal with Elon Musk's X Platform

Elon's X reportedly places $1B order for HPE AI servers

Hewlett Packard Enterprise has reportedly secured a contract to supply Elon Musk's X, the site better known as Twitter, with more than $1 billion in AI-accelerating servers. The agreement, first reported by Bloomberg, cites anonymous sources that claim HPE is the latest to benefit from the Tesla tycoon's artificial intelligence ambitions. Musk's model-building outfit xAI, which makes its generative Grok model mainly available via the billionaire's X, has a combination of Dell and Supermicro systems in its 100,000 GPU Colossus supercomputer in Memphis, Tennessee. That system is due to be upgraded with an additional 100,000 GPUs, with plans to eventually expand the system to a million accelerators in the future. These HPE-supplied systems, as reported, are in our view either going to end up at X to run AI inference and training work, or at xAI doing the same. X and xAI are quite tangled; as we said, xAI provides a Claude/ChatGPT/Gemini-like model called Grok that netizens interact with mainly from X. Musk has previously redirected 12,000 Nvidia H100 GPUs originally bound for Tesla to xAI, arguing the parts would have sat unused otherwise. Last month, X opened Grok and xAI's new image-gen capabilities to all X-ers beyond the previous limitation to X Premium subscribers. This month, xAI also launched a standalone Grok app for iOS. Broader availability of these services likely will necessitate additional compute resources, especially if future Grok models continue to grow in size. HPE, for its part, is no stranger to accelerated computing. Its Cray division is responsible for building some of the largest supercomputers in the world, including the El Capitan, Frontier, and Aurora supercomputers, which rank among the three most powerful systems on the publicly known global top-500 list. More recently, HPE announced a series of new liquid-cooled GPU systems available with your choice of Nvidia, AMD, or Intel GPUs and AI accelerators. Which of the three X has opted for has yet to be disclosed, however, we'll note that most deployments by Musk's enterprises have utilized Nvidia accelerators. It's also possible X's decision to source systems from HPE may have been driven by a desire to find alternative suppliers in the wake of Supermicro's accounting drama. The Register reached out to HPE and X for comment, and had not heard back at the time of publication. ®

HPE Wins Blockbuster $1B AI Server Deal With Elon Musk's X: Report

'This is an industry-changing deal for HPE's AI business and HPE's AI partners,' says Advizex CEO C.R. Howdyshell. 'I'm sure to win a deal like this with Elon Musk and X was extremely challenging.' Hewlett Packard Enterprise has won a $1 billion AI server contract with Elon Musk's X social media platform, according to a Bloomberg report. The blockbuster deal was reached last year, according to Bloomberg, citing sources who asked to remain anonymous because the deal was private. The highly prized contract with X is a vote of confidence for the HPE AI server business which was up 16 percent in the most recent quarter to $1.5 billion. HPE shares were up 25 cents or one percent to $22.33 in after-hours trading. The 52-week high for HPE shares is $24.24. C.R. Howdyshell, CEO of Advizex, a Fulcrum IT Partners company and a leading HPE AI solution provider, called the big win an "industry-changing deal" for HPE's AI business and HPE's AI partners. "I'm sure to win a deal like this with Elon Musk and X was extremely challenging," said Howdyshell. "These are hard deals to get done. This just reinforces the opportunity we have as an HPE partner to deliver AI solutions." Even though the X deal looks like a "once-in-a-lifetime opportunity," Howdyshell said he sees more blockbuster AI deals ahead in 2025. "Our OEM partners are telling us they see this AI business as a three-year TAM (Total Addressable Market) of $1 trillion," he said. Advizex has seen first-hand the power of the HPE-Nvidia portfolio with its $40 million deal that it closed last year with bitcoin miner and next generation infrastructure platform provider Hut 8. That deal was for 125 HPE Cray XD670 supercomputer nodes with 1,000 Nvidia H100 GPUs. Howdyshell said he is pumped up about the HPE and Nvidia partnership and the opportunity ahead for Advizex. In fact, Advizex and the Fulcrum team, including AI pioneer Razor, which is part of the Fulcrum portfolio, met with Nvidia this week for a two-day sales and technical briefing. "Working hand-in-hand with Nvidia is a huge boost for our business," he said. "We are committed to significantly expanding our Nvidia partnership from GPUs to networking and software and services." In fact, Howdyshell said, he expects as much as one-third of Advizex's revenue this year could come from the AI business. "This is our number one area of focus for opportunity and growth in 2025," he said. "This represents more than just GPUs. It is networking, software and services." Key to the Advizex go-to-market is the Razor team, which has deep vertical market AI expertise. "Razor is working hand in hand with Nvidia to drive this AI opportunity with us," he said. Advizex is taking scalable Razor AI solutions into all its top vertical markets including manufacturing, healthcare, retail, financial and SLED. Another big advantage for Advizex in the AI channel battle is its razor-sharp business focus on the opportunity that has resulted from its creation of a new high-performance compute and AI business unit led by Advizex Vice President and General Manager Steve Kucker. "We have the focus, the talent, the resources, we can tell the story and with the help of our OEMs we are highly confident we are going to be incredibly successful with our AI solutions business," he said.

HPE lands $1 billion AI server order from Elon Musk

Bloomberg reports that HPE has secured a deal exceeding $1 billion to build AI servers for the X social platform, previously known as Twitter. To supply servers to Elon Musk's X, the company outcompeted Dell and Supermicro, two prominent suppliers of AI servers. Since the deal is confidential, HPE did not comment to Bloomberg. The deal was reportedly finalized in late 2024, following a competitive bidding process involving Dell and Supermicro. HPE, historically behind Dell and Supermicro in AI server sales, has ample reason to consider this agreement a significant endorsement of its technology. While $1 billion is a lot of money even by AI industry standards, this is a big win for HPE and a significant loss for Dell and the troubled Supermicro. Bloomberg does not provide details about the servers HPE will supply to the microblogging platform, but most big companies rely on Nvidia AI GPUs. In general, GPUs are believed to account for half of an AI server's cost, so assuming we are dealing with GPU-based servers, a $1 billion deal would imply $500 million worth of GPUs. Assuming that HPE and X will get a Blackwell GPU at $50,000 a unit (the actual cost of these GPUs varies), X will get a cluster of AI servers with 10,000 Blackwell GPUs. Such a cluster would offer rather formidable performance: up to 90 FP4 ExaFLOPS and 45 INT8/FP8 ExaTOPS. It remains to be seen how X plans to use this computational superpower. Of course, we are speculating as we do not know what is inside those machines. Twitter used to buy custom servers from companies like MiTAC (Tyan), Supermicro, and Wiwynn. After Elon Musk acquired Twitter in 2022, the company ceased to buy servers from MiTAC (Tyan) and Wiwynn but retained its business deals with Supermicro. Interestingly, Musk's AI venture xAI contracted Dell to build its Colossus supercomputer for artificial intelligence with 100,000 Nvidia H100 GPUs.

HPE secures $1 billion AI server deal for Elon Musk's X, Bloomberg News reports

(Reuters) - Hewlett Packard Enterprise has struck a deal worth over $1 billion to provide Elon Musk's social media platform X with servers optimized for artificial intelligence work, Bloomberg News reported on Friday, citing people familiar with the matter. The agreement was reached late last year, the report said, adding that competitors Dell Technologies and Super Micro Computer had also bid to sell the equipment. Hewlett Packard Enterprise declined to respond to a Reuters request for comment. AI servers have been seeing strong demand from enterprises looking for hardware capable of powering artificial intelligence applications. Musk's companies, including Tesla and xAI, have emerged as major customers for such hardware. (Reporting by Puyaan Singh and Aamir Sohail in Bengaluru; Editing by Mohammed Safi Shamsi)

HPE Secures USD 1 Billion AI Server Deal with X: Report

HPE shares saw a 1 percent increase following the announcement. Hewlett Packard Enterprise (HPE) has signed a deal exceeding USD 1 billion to provide artificial intelligence (AI)-optimised servers to Elon Musk's social media platform, X, Bloomberg News reported on Friday, citing sources familiar with the matter. The agreement, finalised late last year, comes amid surging demand for hardware capable of supporting advanced AI applications. Also Read: xAI Raises USD 6 Billion in Series C Funding HPE competitors Dell Technologies and Super Micro Computer had also bid to sell the equipment, the report said. Musk's companies, including X, Tesla, and xAI, are driving demand for high-performance computing infrastructure to power AI advancements. According to the report, AI servers have been seeing strong demand from enterprises looking for hardware capable of powering artificial intelligence applications. Following the news, HPE shares rose 1 percent in afternoon trading. Also Read: Dutch Government Secures Nvidia Deal for AI Facility: Report In another such development, the Dutch government reportedly reached a deal with Nvidia last week to supply hardware and technological expertise for a potential AI supercomputer facility.

HPE Wins $1 Billion AI Server Deal for Elon Musk's X

Hewlett Packard Enterprise Co. won a deal worth more than $1 billion to provide Elon Musk's X social network with servers optimized for artificial intelligence work. The agreement was reached late last year, according to people familiar with the matter who asked to remain anonymous because the deal was private. Competitors Dell Technologies Inc. and Super Micro Computer Inc. also bid to sell the equipment.

Elon Musk's X, Hewlett Packard Strike $1 Billion AI Server Deal: Report - Hewlett Packard (NYSE:HPE), Dell Technologies (NYSE:DELL)

Hewlett Packard Enterprise Co HPE has reportedly secured a deal worth over $1 billion to supply servers optimized for artificial intelligence to Elon Musk's social media platform, X. What Happened: The deal between HP and X was finalized late last year, Bloomberg News reported on Friday, citing sources familiar with the matter. The servers are tailored for AI applications, a segment witnessing robust demand from enterprises. Competitors Dell Technologies Inc. DELL and Super Micro Computer Inc. SMCI also vied for the contract. The market for AI servers has been expanding, with businesses increasingly looking for hardware that can support artificial intelligence applications. Companies under Musk's leadership, including Tesla Inc. TSLA and xAI, have become prominent clients for such hardware. Why It Matters: Musk's interest in AI is well-documented. In a recent discussion, Musk predicted that AI could reach human-level capabilities by 2029. "I certainly feel comfortable saying that it's getting 10 times better per year which is, let's say, four years from now that would mean 10,000 times better," Musk said. His AI startup, xAI, is also making strides, with Musk announcing the integration of its Grok chatbot into Tesla vehicles soon. Musk shared the update during a live stream on X, stating, "Grok in Teslas is coming soon. You will be able to talk to your Tesla and ask for anything." Meanwhile, Musk's social media platform, X, is facing competition from Bluesky, a rival platform that is reportedly nearing a $700 million valuation. Price Action: On Friday, HPE stock saw a 0.23% increase, according to Benzinga Pro data. The latest analyst ratings for Hewlett Packard Enterprise Co. were issued by Deutsche Bank, Loop Capital, and Barclays on Dec. 19, Dec. 9, and Dec. 6, respectively. With an average price target of $25.33 across these firms, the ratings suggest an implied upside of 14.01% for the company. Check out more of Benzinga's Consumer Tech coverage by following this link. Read Next: Dana White Wanted Elon Musk, Mark Zuckerberg In Cage Fight, Now He's On Meta's Board Of Directors Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors. Photo courtesy: Wikimedia DELLDell Technologies Inc$114.75-3.82%WatchlistOverviewHPEHewlett Packard Enterprise Co$22.220.87%SMCISuper Micro Computer Inc$32.620.03%TSLATesla Inc$393.10-0.47%Market News and Data brought to you by Benzinga APIs

HPE stock spikes following Bloomberg report of $1 billion AI server deal with Musk's X By Investing.com

Investing.com -- Shares of Hewlett Packard Enterprise Co . (NYSE:HPE) climbed over 3% Friday afternoon following a Bloomberg report that said the company secured a lucrative contract exceeding $1 billion with Elon Musk's social media platform X. The deal, which was finalized late last year, positions HPE to supply AI-optimized servers, a significant win over competitors Dell Technologies Inc. (NYSE:DELL) and Super Micro Computer (NASDAQ:SMCI) Inc. The agreement, whose details were shared by sources wishing to stay anonymous, underscores the increasing demand for high-powered servers capable of managing AI workloads, the report noted. Musk's various ventures, including Tesla (NASDAQ:TSLA) Inc. and xAI, have become prominent clients in the hardware space. Notably, xAI's supercomputer project in Memphis has incorporated hardware from both Dell and Super Micro. HPE's success in securing the deal is a noteworthy endorsement of its AI server capabilities, which had previously been considered somewhat behind those of its rivals. The AI servers in question are equipped with advanced chips from companies like Nvidia Corp . (NASDAQ:NVDA), which has seen explosive growth and a consequent boost in revenue for its server and system vendor clients. This contract could mark a turning point for HPE's AI server business, which Chief Financial Officer Marie Myers discussed in a December earnings call. Myers highlighted the expectation of growing AI system adoption by enterprises and governments, though she noted that order patterns are anticipated to remain competitive and sporadic. The overall market for data center infrastructure has been on the rise, with spending estimated to have jumped 34% to $282 billion in 2024, as reported by Synergy Research Group. The research firm pointed to Nvidia's significant growth as a major narrative in the industry, benefiting its server and system vendor clients through increased revenues.