Elon Musk’s artificial intelligence venture xAI has acquired a third building near Memphis as part of its aggressive expansion plans for its flagship ‘Colossus’ data centre complex, a move that will push the company’s AI computing capacity to nearly 2 gigawatts.
Musk confirmed the development in a post on X, saying the newly acquired facility will significantly boost xAI’s training infrastructure. “xAI has bought a third building called MACROHARDRR. This will take xAI training compute to almost 2GW,” Musk wrote. A single gigawatt of power is typically sufficient to supply electricity to around 750,000 US homes.
xAI already operates one large data centre in Memphis, known as Colossus, and is currently developing a second nearby facility, referred to as Colossus 2. The newly purchased building is located in Southaven, Mississippi, adjacent to the Colossus 2 site, further consolidating xAI’s AI infrastructure footprint in the region.
The expansion aligns with Musk’s publicly stated ambition to build the world’s largest AI training data centre. Earlier this year, he said Colossus 2 is expected to house up to 550,000 Nvidia chips, representing an investment that could run into tens of billions of dollars, given the scale and cost of advanced AI hardware.
To fund its rapid buildout, xAI has been raising capital aggressively in 2025. The company was earlier reported to be in discussions to raise as much as $20 billion through a mix of debt and equity, largely to finance the purchase of high-end Nvidia processors required for large-scale AI model training.
The latest acquisition underscores the intensifying race among global AI players to secure power, real estate, and compute capacity as demand for advanced AI systems continues to surge. For xAI, the Memphis region is emerging as a central hub for its long-term AI infrastructure strategy.
Follow startupbydoc for daily startup insights, funding news, IPO analysis, and business breakdowns.