Asia Tech Wire (July 10) -- Tesla CEO Elon Musk confirmed Tuesday that his artificial intelligence startup xAI has ended talks with Oracle to expand an existing agreement to lease Nvidia chips.

Musk said xAI is building a supercomputer with 100,000 Nvidia graphics processing units (GPUs), the chips used to train and operate generative AI programs, and that "our fundamental competitiveness depends on being faster than any other AI company."

He additionally revealed that xAI's Grok 2 model is trained on 24,000 Nvidia H100 chips from Oracle, and is "probably ready for release next month."

Oracle said last September that it had reached an agreement to provide xAI with cloud infrastructure to train AI models. However, it did not disclose the value or duration of the contract at the time.

In May this year, media reports said the two companies were close to an agreement to expand their relationship, with xAI spending about $10 billion to rent cloud servers from Oracle for several years.