Musk's xAI and Oracle have ended discussions on a $10 billion server purchase, according to a report

Billionaire Elon Musk's artificial intelligence startup xAI and tech giant Oracle have ended talks on a potential $10 billion server deal, The Information reported Tuesday.

The startup and Oracle have ended talks to expand an existing arrangement under which xAI has leased Nvidia's artificial intelligence chips from the cloud provider, the report said, citing multiple people involved in the talks. The AI ​​startup is building a system that uses only Nvidia H100 graphics processing units, Musk said on his social media platform X.

A multi-year deal is underway to lease Nvidia processors from Oracle for a planned supercomputer, but talks have been delayed by issues such as Musk's demands to build the supercomputer faster than Oracle thought possible, according to The Information. Oracle also raised concerns that xAI's preferred location had insufficient power supply, the report added.