Elon Musk reportedly directed Nvidia (NASDAQ:NVDA) to prioritize processor shipments for X and xAI over Tesla (NASDAQ:TSLA), according to insider emails obtained by CNBC.
Internal correspondence from Nvidia senior staff suggests Musk exaggerated Tesla’s procurement status to shareholders. Moreover, Musk diverted a large shipment of AI processors meant for Tesla to his social media company X, formerly known as Twitter.
Tesla shares fell 0.6% at the market open Tuesday.
By ordering Nvidia to prioritize X over Tesla, Musk delayed the automaker's receipt of over $500 million worth of GPUs by several months, the report says, a delay that could impact the carmaker’s efforts to develop autonomous vehicles and humanoid robots, as the supercomputers needed for these projects require the GPUs.
"Elon prioritizing X H100 GPU cluster deployment at X versus Tesla by redirecting 12k of shipped H100 GPUs originally slated for Tesla to X instead," an Nvidia memo from December stated. "In exchange, original X orders of 12k H100 slated for Jan and June to be redirected to Tesla."
A more recent Nvidia email from late April indicated discrepancies in Musk's statements during Tesla's first-quarter call and his April post about $10 billion in AI spending. The email also highlighted Tesla’s significant layoffs and warned that further headcount reductions could delay an "H100 project" at Tesla's Texas Gigafactory.
This information underlines growing tensions between Musk and some frustrated Tesla shareholders, who are concerned about whether Musk is fully committed to the EV giant while managing multiple other companies.
Critics argue that Musk acts as a part-time CEO of Tesla, which generates the majority of his wealth. Alongside Tesla, Musk is the CEO of SpaceX, founder of Neuralink, and The Boring Co., and owns X, which he acquired for $44 billion in late 2022. He also launched xAI, an AI startup, in 2023.
The reported concerns come as Tesla grapples with declining sales, partly due to its aging lineup and rising competition. Tesla's reputation in the U.S. has also been affected, as reflected in the Axios Harris Poll 100 survey, which attributes some of the decline to Musk’s "antics" and "political rants."
Tesla's stock price has fallen 29% this year.