tech

Max Knoblauch2/14/25

Dell shares get a boost on reports of $5 billion deal to sell servers to Musk’s xAI

Dell isn’t just a company that sells work laptops with excessive McAfee pop-ups.

Bloomberg reports that the PC powerhouse is close to striking a $5 billion deal to sell AI-optimized servers containing Nvidia semiconductors to Elon Musk’s xAI. Its shares were up more than 3% intraday.

Dell has rapidly boosted the AI server side of its business. In its November earnings report, Dell said it shipped $2.9 billion worth of AI servers and has an order backlog of $4.5 billion. Its servers and networking revenue rose 58% to $7.4 billion on the quarter. Analysts expect Dell to ship $14 billion worth of AI servers in its current fiscal year.

Last month, xAI launched a free app for its flagship chatbot, Grok.

Dell Nears $5 Billion AI Server Deal for Elon Musk’s xAI

Dell Nears $5 Billion AI Server Deal for Elon Musk’s xAI

Dell has rapidly boosted the AI server side of its business. In its November earnings report, Dell said it shipped $2.9 billion worth of AI servers and has an order backlog of $4.5 billion. Its servers and networking revenue rose 58% to $7.4 billion on the quarter. Analysts expect Dell to ship $14 billion worth of AI servers in its current fiscal year.

Last month, xAI launched a free app for its flagship chatbot, Grok.

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The iPhone maker reported its FY 25 fourth-quarter earnings Thursday.

Tesla just recalled its beleaguered Cybertruck for the 10th time since the vehicle was introduced two years ago. This time the company recalled about 6,000 of the “apocalypse-proof” vehicles due to what the National Highway Traffic Safety Administration says is an improperly installed “optional off-road light bar accessory” that could become disconnected from the windshield while driving, and could “create a road hazard for following motorists and increase their risk of a collision.”

CEO Elon Musk once said he could sell up to 500,000 of the stainless steel behemoths a year. In the first three quarters of this year, the company has sold only about 16,000.

Microsoft: Forget what we said, we are going to keep spending on capex

Last quarter, the company offered guidance that its capex spending would be lower in the second half of the fiscal year. Yesterday it said spending would go up.

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Analysts lower Meta price targets after social media giant says AI capex will keep climbing

Meta may have posted record revenue Wednesday but the stock is deeply in the red in the wake of its third-quarter earnings report, after the social media company said that its capital expenditure on AI would continue to rise.

The earnings prompted a number of analysts to lower their price targets or downgrade the stock.

RBC Capital lowered its price target to $810 from $840. Bank of America Securities lowered its price target to $810 from $900. Barclays, JPMorgan, Deutsche Bank, and Wells Fargo also lowered their price targets on the company.

Earlier today, Benchmark downgraded its rating to a “hold” from a “buy.” Oppenheimer downgraded the company to “perform” from “outperform,” saying the “significant investment in Superintelligence despite unknown revenue opportunity mirrors 2021/2022 Metaverse spending.” Ouch.

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