Groq joins with Aramco to build data center and AI regional hub

Groq Inc., a California-based artificial intelligence startup, is teaming up with Aramco to build a data center in Saudi Arabia that it hopes will become a regional AI hub.

With funding from Aramco, the No. 1 oil company, Groq plans to operate the world’s largest AI inferencing center with an initial cluster of 19,000 language processing units that is expected to cost “in the order of nine figures,” CEO Jonathan Ross told Bloomberg in an interview. It may grow to as much as 200,000 processing units.

The partnership will be managed through Aramco Digital, a new unit intended to help Aramco use AI in its core energy business while also helping other firms use the technology.

Aramco is “planning to do massive capital deployments for this, and it is a way to help diversify the economy away from oil,” Ross told the news agency.

By building the data center in Saudi Arabia, Groq aims to capitalize on the country’s low energy costs, availability of land, and access to 4 billion people within a 100 millisecond ping – a measure of how quickly data can travel between processing location and users, Ross said.

Saudi PIF pumps another $1.5 billion into Lucid Motors

Saudi Arabia’s Public Investment Fund has pumped another $1.5 billion into electric vehicle start-up Lucid Motors ahead of the launch of its first SUV later this year.

The PIF, which already has a 60% stake in California-based Lucid after investing about $8 billion over several years, will buy $750 million in convertible preferred stock and provide a $750 million loan facility through Ayar, an affiliate investment company.

Nasdaq-traded Lucid reported Q2 earnings yesterday, recording a $790 million net loss, but beating analyst expectations with $200 million revenue after delivering 2,394 cars in the quarter.

The EV maker expects to produce 9,000 cars for 2024, with the launch later this year of the Gravity SUV, priced at around $80,000, which is likely to diversify its potential customer base. 

Saudi Arabia has been scouring the globe for potential supplies of lithium, a critical mineral used in battery production, as it attempts to become a major regional EV manufacturer, with Lucid opening a factory in the kingdom last year. 

Bandar Alkhorayaf, Saudi Arabia’s Minister of Industry and Mineral Resources, toured Brazil and Chile over the past two weeks looking for mining investment opportunities.

As a result, the kingdom is eyeing a collaboration with Chilean state-owned miner Codelco to develop lithium deposits.