MEMPHIS — Elon Musk’s artificial intelligence startup, xAI, has acquired a third building to significantly expand its infrastructure. The acquisition aims to boost the company’s training capacity to nearly 2 gigawatts of compute power as it scales its operations to compete with industry leaders like OpenAI and Anthropic.
The new facility, which Musk referred to on the social media platform X as “MACROHARDRR,” is reportedly a warehouse planned for conversion into a supersized data center starting in 2026. While Musk did not disclose the location, property records indicate the site is situated outside Memphis, Tennessee.
This expansion supports the growth of xAI’s supercomputer cluster, Colossus, currently touted as the largest in the world. The company plans to house at least 1 million graphics processing units (GPUs) within the cluster. To meet the massive energy demands of these facilities, xAI is constructing a dedicated natural gas power plant in the area to complement other power sources. However, the rapid expansion of such energy-intensive infrastructure has drawn criticism from environmental activists concerned about the high ecological footprint of large-scale data centers.
The Infrastructure Arms Race: xAI and the Future of Compute
The recent acquisition by xAI marks a pivotal moment in the “compute arms race” currently defining the artificial intelligence sector. By aiming for a 2-gigawatt capacity, xAI is not merely seeking incremental growth but is attempting to build a foundation for Artificial General Intelligence (AGI) that rivals the scale of established tech giants.
For context, the energy required to run these facilities is staggering. A single gigawatt can power roughly 750,000 homes; xAI’s goal of 2 gigawatts places its infrastructure on par with some of the largest industrial complexes in the world. This level of investment is necessary because the performance of Large Language Models (LLMs)—like xAI’s Grok or OpenAI’s GPT-4—is directly correlated with “compute,” or the sheer amount of processing power and data used during training.
To achieve this, xAI is bypassing traditional utility constraints by building its own natural gas power plant. This move mirrors strategies used by other tech titans, such as Microsoft and Constellation Energy restarting the Three Mile Island nuclear reactor to fuel AI data centers. By securing independent power and massive GPU clusters, Musk is attempting to collapse the “training wall,” ensuring that xAI has the hardware necessary to iterate faster than competitors like Anthropic or Google.
