xAI, the artificial intelligence startup founded by Elon Musk and creator of the Grok chatbot, is reportedly exploring a potential data center expansion into Saudi Arabia, according to a Bloomberg report.

Rather than building its own facilities, xAI is considering leasing space, taking advantage of the region’s lower energy costs and favorable political and regulatory conditions.

The report notes that xAI has held discussions with two potential partners in the Middle East:

One of them is Humain, an AI venture launched earlier this year and backed by Saudi Arabia’s $1 trillion sovereign wealth fund. Humain is aiming to deliver up to 6.6 gigawatts of data center capacity across the kingdom over the next ten years.

The second potential partner, though unnamed, is reportedly developing a 200-megawatt data center currently under construction.

If realized, the move would signal xAI’s growing ambitions in global AI infrastructure, positioning itself closer to high-growth markets while optimizing for power efficiency and scale.

xAI already owns and operates a data center in Memphis, Tennessee, and is currently planning to build a second facility in the same city.