Elon Musk’s xAI to build $20 billion data center in Mississippi
Elon Musk’s AI company xAI plans to spend $20 billion on a data center in Southaven, Mississippi.
JACKSON, Miss. — Elon Musk’s artificial intelligence company xAI is set to spend $20 billion to build a data center in Southaven, Mississippi, Gov. Tate Reeves announced Thursday, calling it the largest private investment in state history.
The data center, called MACROHARDRR, is being built in DeSoto County, Mississippi, near Memphis, Tennessee. This will be the company’s third data center in the greater Memphis area. Anthony Armstrong, xAI’s chief financial officer, said the data center cluster will house “the world’s largest supercomputer” with 2 gigawatts of computing power.
The announcement comes as xAI faces increased scrutiny over its Memphis-area data center plans. The NAACP and the Southern Environmental Law Center have raised concerns about air pollution generated by xAI’s supercomputer located near predominantly black communities in Memphis.
A petition from the Safe and Sound Coalition, a Southaven group opposing xAI’s developments, calls for a halt to xAI’s operations in the area and received more than 900 signatures as of Thursday afternoon.
xAI did not immediately respond when asked for comment on environmental concerns.
A fact sheet released by the Mississippi governor’s office states that environmental responsibility is a “core commitment” for xAI.
During the announcement, Reeves personally thanked Musk. Reeves predicted the investment would bring hundreds of permanent jobs to the community, thousands of indirect contracting jobs and tax revenue to support public services.
As part of data center incentives passed in 2024, the state will waive all sales, corporate profits and franchise taxes on xAI development. Saving sales taxes on the computing power purchased by xAI would likely be worth a substantial amount of money, but the Mississippi Development Authority did not immediately respond to questions from The Associated Press about how much tax revenue Mississippi would forgo.
DeSoto County and the City of Southaven also agreed to allow a substantial reduction in property taxes.
xAI is expected to begin data center operations in Southaven next month.
