"The X-1000 is a masterpiece. Imagine a microchip sophisticated enough to control the guiding systems of ballistic missiles. Imagine it can be used to instantly upgrade any system that its plug into like a smart drug for machines. Then imagine it can learn."-RalphX-1000 is micro-munitions processing hard-wired chips developed by GloboTech Industries for the Department of the Defense. The chips were so advanced that they can upgrade any system they plug into and enhance it to the point that it become sentient being that can learn and their intelligence were described to be Actual instead of Artificial despite that they are Artificial. The chips can also overcome their programming. However, despite all their capabilities, the chips were sensitive to the EMP, the kind that generate from a nuclear explosion, so the military dropped the project. This caused Ralph to be upset because the chips was his finest work.
After an unknown amount of time Larry Benson used the chips in the new toys he and his partner Irwin Wayfair made. The chips were plugged into the evil Commando Elite and the heroic Gorgonites, the evil Commando Elite were programmed to destroy the heroic Gorgonites and the heroic Gorgonites were ultimately programmed to hide and lose against the evil Commando Elite.
The evil Commando Elite, after the "death" of Nick Nitro used his chip to create other chips to use them on Gwendy Dolls. Those chips also were sensitive to the EMP.
The next morning after the battle, Gil Mars (Denis Leary), CEO of Global Tech. Industries arrives at the scene where people are cleaning up after the battle from the night before and he decides that even with the flaw of the X-1000, he wishes them to enter military service in South America.