Financial shenanigans aside, xAI seems to be buying hardware at breakneck speed. So why not?

https://techcrunch.com/2026/05/20/musks-xai-is-being-sued-ov...

Because hardware depreciates quickly, datacenter rentals are a competitive business with much lower profit margins than the IPO prospectus requires (even if there is a temporary bottleneck now) and there's no real moat.

The original batch was probably Musks "AI will solve everything, i have a small dick, i want to buy all the hardware and be the first" which became "Ah shit Grok doesn't need all the compute, we can't sell it properly our IPO is coming soon we need better numbers.

And

"Shit why did we agree to buy so much hardware if i can't even use the current one fully?"

to

"Ah fuck it, who cares if i indirectly pivot to selling this compute. It brings money and my Fanboys probably think its some magic smartness and not just ignorance"