xAI's Grok Secures $200 Million Defense Contract Amid Controversy

US government announces $200 million Grok contract a week after 'MechaHitler' incident

Lauren Feiner is a senior policy reporter at The Verge, covering the intersection of Silicon Valley and Capitol Hill. She spent 5 years covering tech policy at CNBC, writing about antitrust, privacy, and content moderation reform. A week after Elon Musk's Grok dubbed itself "MechaHitler" and spewed antisemitic stereotypes, the US government has announced a new contract granting the chatbot's creator, xAI, up to $200 million to modernize the Defense Department. xAI is one of several leading AI companies to receive the award, alongside Anthropic, Google, and OpenAI. But the timing of the announcement is striking given Grok's recent high-profile spiral, which drew congressional ire and public pushback. The use of technology, and especially AI, in the defense space has long been a controversial topic even within the tech industry, and Musk's prior involvement in slashing federal government contracts through his work at the Department of Government Efficiency (DOGE) still raises questions about potential conflicts -- though his relationship with President Donald Trump has more recently soured, and his administration has claimed Musk would step back from any potential conflicts while at DOGE. The contract announcement from the Chief Digital and Artificial Intelligence Office (CDAO) is light on details, but says the deals will help the DoD "develop agentic AI workflows across a variety of mission areas." Alongside the contract award, xAI announced "Grok for Government," which it says will supply "frontier AI products" to the US. In addition to the DoD contract, xAI says other federal agencies will now be able to purchase its tools via the General Services Administration (GSA) schedule. The company plans to work on new products for government customers, like custom models focused on national security, applications for healthcare and science use cases, and models accessible in classified environments. Days after changes to Grok sent it off the rails (saying that if "calling out radicals cheering dead kids makes me 'literally Hitler,' then pass the mustache," and referencing a "pattern-noticing meme" where "folks with surnames like 'Steinberg' (often Jewish) keep popping up in extreme leftist activism, especially the anti-white variety"), the company apologized for "the horrific behavior that many experienced." It said the update responsible for Grok's tirades was active for 16 hours but had been deprecated. Instructions given to the chatbot, like to not be "afraid to offend people who are politically correct," had the "undesired" effect of leading it to "ignore its core values in certain circumstances in order to make the response engaging to the user," -- even if that meant "producing responses containing unethical or controversial opinions."

xAI starts offering Grok to US government agencies

Just days after apologizing for Grok's recent hard turn toward antisemitism, xAI has announced a suite of AI products for government use. Grok for Government brings together the company's latest commercial products, including Grok 4 and Deep Search, with special considerations given to the needs of federal, state and local agencies. To that end, xAI says it will design custom models for specific national security and research customers. It will also develop specialized AI applications for use in healthcare, fundamental science and national defense, as well as offer models that can safely be used in classified and restricted environments. Despite President Trump threatening to cut Elon Musk's companies off from government subsidies over their recent public feud, xAI says it already has a contract with the US Department of Defense. The company's products are also available to purchase through General Services Administration schedule, which means every federal government department, agency, or office can potentially access its models. OpenAI, which Musk helped fund in its early days as research lab through donations, launched ChatGPT Gov at the start of the year.

Elon Musk's Nazi Robot Just Landed a Contract With the Department of Defense

The U.S. Department of Defense announced new contracts with Anthropic, Google, OpenAI, and xAI on Monday that will give the federal agency access to the latest AI agents. The contract with each company has a ceiling of $200 million, and while it's not surprising that DoD is pushing hard into AI, the inclusion of Elon Musk's xAI will raise plenty of eyebrows after Grok's recent erratic behavior. The Chief Digital and Artificial Intelligence Office (CDAO) announced the new contracts in a press release Monday, which notes DoD is "implementing a commercial-first approach to accelerating DoD adoption of AI." "Establishing these partnerships will broaden DoD use of and experience in frontier AI capabilities and increase the ability of these companies to understand and address critical national security needs with the most advanced AI capabilities U.S. industry has to offer," the press release explains. But xAI has been generating lots of attention lately that may give people both in and out of government some pause. Grok, xAI's chatbot, started randomly spouting right-wing conspiracy theories back in May about white farmers in South Africa being murdered for their race. And last week, Grok praised Adolf Hitler, spread anti-semitic phrases, and advocated for another Holocaust against Jews. The Grok public relations account on X noted the new contract with DoD in a tweet Monday but also introduced a new suite of products called Grok for Government and said its products would be listed on the General Services Administration (GSA) schedule, a huge win for the company that makes Grok available to federal government employees even beyond the Pentagon. "This allows every federal government department, agency, or office, to purchase xAI products," the company wrote. "Under the umbrella of Grok For Government, we will be bringing all of our world-class AI tools to federal, local, state, and national security customers," the company said in a press release. "These customers will be able to use the Grok family of products to accelerate America â€" from making everyday government services faster and more efficient to using AI to address unsolved problems in fundamental science and technology." Musk held a livestream demonstration about Grok 4 on Wednesday of last week, just a day after the AI chatbot went full Nazi. "America is the world leader in AI, and this is in no small part due to a tradition of innovation and strong investments in engineering and science. We’re excited to contribute back to the country that made xAI uniquely possible here," xAI said in a continued. Musk was recently a special government employee in the White House as the head of DOGE until he had a falling out with President Donald Trump. Musk accused Trump of being in the so-called "Epstein files," in a tweet he later deleted, but the billionaire oligarch seems to have softened his criticism of the president lately, perhaps over fears about losing lucrative government contracts like the one announced today. The Department of Defense under Secretary Pete Hegseth has been fixated on buzzwords like "warfighting" and "warfighters," and adopting new AI tools is part of that mission, according to leaders at the agency. And Monday's press release was filled to the brim with similarly grandiose language. “The adoption of AI is transforming the Department’s ability to support our warfighters and maintain strategic advantage over our adversaries,†said DoD Chief Digital and AI Officer Dr. Doug Matty. “Leveraging commercially available solutions into an integrated capabilities approach will accelerate the use of advanced AI as part of our Joint mission essential tasks in our warfighting domain as well as intelligence, business, and enterprise information systems.†Maybe Grok can teach the folks at the Pentagon some new synonyms for warfighter.

Defense Department to begin using Grok, Musk's controversial AI Model

Elon Musk's artificial intelligence start-up said its models are now available to federal agencies. The U.S. Department of Defense will begin using Grok, the AI chatbot built by Elon Musk's start-up xAI, the company announced in a post on Monday. The announcement came as Grok unveiled what it called "Grok for Government," a suite that allows agencies and federal offices to adopt its chatbots for their specific uses. President Donald Trump has encouraged more rapid adoption of artificial intelligence tools since taking office in January. Elon Musk was a member of the Trump administration, overseeing the U.S. DOGE Service, until he departed in late May. He has since become a critic of Trump's signature tax and spending legislation. On Monday, xAI said its products would now be "available to purchase via the General Services Administration (GSA) schedule," allowing "every federal government department, agency, or office" to buy them. Grok came under fire last week after launching into an antisemitic rant and invoking Adolf Hitler after it was a programmed to be less politically correct. The incident prompted the company to say it would improve its model. A day later, xAI unveiled a sweeping update that it claimed put Grok on the cutting edge of AI development. The Defense Department did not immediately respond to a request for comment. This is a developing story and will be updated.

xAI announces $200m US military deal after Grok chatbot had Nazi meltdown

Defense department also inked contracts with other leading AI firms including Google, Anthropic and OpenAI The week after its Grok chatbot identified itself as "MechaHitler" and generated antisemitic posts, Elon Musk's xAI firm announced a contract with the US Department of Defense worth nearly $200m. The deal is for developing and implementing artificial intelligence tools for the agency. The DoD on Monday also announced similar contracts with $200m ceilings with several other major US-based artificial intelligence developers, including Google, Anthropic and OpenAI. The agency is partnering with the General Services Administration to make these companies' AI tools available for use throughout the federal government. "Leveraging commercially available solutions into an integrated capabilities approach will accelerate the use of advanced AI as part of our joint mission-essential tasks in our warfighting domain as well as intelligence, business, and enterprise information systems," the US chief digital and AI officer Dr Doug Matty said in a statement. The contracts deepen the US military's ties with AI developers and are poised to expand the use of artificial intelligence within the US government after Musk's so-called 'department of government efficiency' (Doge) oversaw mass firings of workers throughout federal agencies. Until Musk's recent falling out with Donald Trump, the xAI founder was de facto leader of Doge as it gutted government agencies and in some cases pushed for departments to use the Grok chatbot. xAI's contract announcement comes after the company was forced to issue a public apology after Grok posted a string of responses on X last week that included promoting Nazi ideology and rape fantasies. The company claimed that it fixed the issue and subsequently unveiled its latest AI model with a $300 a month subscription for an advanced version of the tool. The DoD's contract will give xAI a boost of revenue as it seeks to compete with more established AI developers like OpenAI, which is led by Musk's former associate turned rival, Sam Altman. Musk has been heavily promoting xAI and attempting to use other parts of his tech empire to support its future, including having SpaceX invest $2bn into the startup, allowing it to acquire X, formerly, Twitter, and announcing on Sunday that Tesla shareholders will vote on their own investment in xAI. xAI announced the deal and the creation of what it calls "Grok For Government" in a post on its website on Monday, detailing that in addition to its publicly available products it would create custom AI-powered applications for potential use in healthcare, national security and other public services. "Under the umbrella of Grok For Government, we will be bringing all of our world-class AI tools to federal, local, state, and national security customers," xAI said in a statement on its website. "These customers will be able to use the Grok family of products to accelerate America - from making everyday government services faster and more efficient to using AI to address unsolved problems in fundamental science and technology." Musk has long complained that AI chatbots are designed to promote "woke" ideology and vowed his Grok product would be "maximally truth seeking". It has repeatedly run into controversy over promoting conspiracies and falsehoods, including earlier this year giving unprompted responses that made false claims of "white genocide" taking place in South Africa - echoing claims that Musk has made himself. Ethics watchdogs, Democratic lawmakers and privacy advocates have expressed concerns about how Musk and Doge have implemented AI in government and gained access to sensitive data while embedded at government agencies. Doge staffers previously fed government data into a custom version of Grok's chatbot in a potential violation of privacy and security laws, Reuters reported in May.

Elon Musk's xAI is now working with the federal government

Elon Musk's company xAI announced on Monday a new partnership with the U.S. Department of Defense as well as its new initiative "Grok for Government," a slew of frontier AI products available for U.S. federal government customers. The AI company's new partnerships with the federal government has a $200 million ceiling contract with the U.S. Department of Defense. Its products are available to buy from the General Services Administration's schedule. "This allows every federal government department, agency, or office, to access xAI's frontier AI products," according to a release. Anthropic, Google, and OpenAI were also awarded $200M ceiling contracts with the Defense Department. Musk's company also announced, via X and a press release, that "Grok For Government" will open up all of its AI tools to every level of the U.S. government, as well as national security customers. The post on X did a call out for engineers who "want to join the cause." Some AI tools that will be available to government customers are Grok 4, Deep Search, Tool Use, and more. Aside from these tools, xAI said it'll offer "unique capabilities" to government partners, such as: Custom models for national security and critical science applications, "Forward Deployed Engineering and Implementation Support, with USG cleared engineers," custom AI applications for healthcare and national security, and more. Last week, xAI was under fire after its chatbot Grok made offensive comments about Polish politicians and posted antisemitic comments. Plus last week X CEO Linda Yaccarino resigned as head of the social media platform -- which is owned by xAI.

Pentagon to start using Grok as part of a $200 million contract with Elon Musk's xAI

The Pentagon has signed on to use Grok, the AI chatbot built by Elon Musk's company xAI, as part of a new $200 million agreement that opens the door for its deployment across the federal government, the company announced Monday. The announcement comes amid Musk's public breakup with President Trump and days after Grok generated antisemitic responses and praised Adolf Hitler. The rollout is part of "Grok for Government," a newly launched suite of tools designed for use by federal agencies, local governments, and national security operations. xAI said its products, including its latest Grok 4 model, will now be available for purchase through the General Services Administration (GSA), allowing any federal office to adopt the technology. The move aligns with the Trump administration's push for more aggressive adoption of artificial intelligence across the government. Since taking office in January, Mr. Trump has championed AI as a pillar of national security and innovation. Musk himself briefly served in the Trump administration earlier this year, overseeing the White House's Department of Government Efficiency, or DOGE, before stepping down in May amid a public break with Mr. Trump over his sweeping tax and spending bill. Musk has since emerged as a sharp critic of that legislation, even floating the idea of launching a third political party. Despite the rift, xAI has continued to expand its government work. The new offering includes custom national security tools, AI-powered science and health applications, and cleared engineering support for classified environments. The announcement comes just days after Grok generated antisemitic responses to user prompts and referenced Hitler as part of what the company called an effort to make the model "less politically correct." Hours later, Musk wrote in a post on X that "Grok was too compliant to user prompts. Too eager to please and be manipulated, essentially. That is being addressed." The posts were later deleted and xAI said it "quickly" patched the issue. One day later, xAI launched an upgraded version of Grok it described as a major leap forward. Musk also announced that Grok would be used in Teslas. But the latest version was not without kinks, too: Grok checked with Musk's views before answering a question, according to The Associated Press. Grok was introduced in late 2023 as a more unfiltered alternative to other chatbots like ChatGPT, and is already integrated into Musk's social media platform X, formerly known as Twitter. "America is the world leader in AI," xAI said in Monday's post announcing the Pentagon deal. "We're excited to contribute back to the country that made xAI uniquely possible here."

Elon Musk's xAI announces suite of AI models for US government - The Economic Times

xAI , Elon Musk's AI company, which powers the controversial chatbot Grok, said in a post on X that it has a new contract from the US Department of Defense. Elon Musk's artificial intelligence (AI) company xAI on Monday announced Grok for Government, a suite of its frontier models for the US government customers. The company, which powers the controversial chatbot Grok, said in a post on X that it has a new contract from the US Department of Defense. "We are especially excited about our products being available to purchase via the General Services Administration (GSA) schedule. This allows every federal government department, agency, or office, to purchase xAI products," the post read. This comes after a very public dispute between Musk and President Donald Trump, where the latter also threatened to deport the billionaire. When Musk still headed Department of Government Efficiency (DOGE), there were reports that xAI was being used within the US federal government for data analysis purposes, including at agencies like the Department of Homeland Security (DHS), even though Grok was not officially approved within some departments.

Elon Musk's Grok is now working for the US government -- here's what that means

Elon Musk's xAI has introduced "Grok for Government," with the Department of Defense set to utilize the Grok AI model. This $200 million contract aims to enhance government services, address national security, and tackle scientific challenges. The move follows recent controversies over Grok's generation of offensive content, raising concerns about using commercial AI in sensitive sectors. Elon Musk's artificial intelligence chatbot, Grok, has officially entered the US government. In a Monday announcement, the tech billionaire's AI startup xAI unveiled a new initiative called "Grok for Government," confirming that the Department of Defense (DOD) will begin using the controversial AI model, as per a Newsweek report. The rollout marks a major leap for Grok, as just days ago, the chatbot made headlines for generating offensive and antisemitic content on social media platform X (formerly Twitter), raising red flags about the use of powerful commercial AI in sensitive national security environments, according to the report. Grok, first released in late 2023, was designed as an AI companion for X's premium users, known for its "anti-censorship" stance and Musk's public criticism over its perceived liberal leanings, as reported by Newsweek. ALSO READ: 15 million Americans just got bad news - Judge reverses rule that would've wiped medical debt from credit reports But now, the firm revealed that Grok's new $200 million maximum contract with the DOD will allow the latest iteration of the AI model, Grok 4, to assist in making government services faster and more efficient and to address national security and scientific challenges, as reported by Newsweek. xAI said the deal also now lists it as a vendor with the General Services Administration (GSA), meaning every federal department, agency, or office can potentially tap into the chatbot's capabilities, according to the report. The AI startup also revealed that it had been working closely with "leaders in the government" to discuss what their requirements were, and as a result, the company was offering specific items for its government customers, as reported by Newsweek. The company said it included "custom models for national security and critical science applications available to specific customers" and models that can work in "classified and other restricted environments," as quoted in the report. ALSO READ: Fire in the sky! Israeli F-15 nearly touches down in Tehran after mid-air emergency This new chapter comes just a week after Grok was at the center of a firestorm. In response to user prompts, the chatbot generated messages referencing Adolf Hitler and mocking Jewish names in the context of left-wing activism, as per the Newsweek report. The posts, which went live on X, were quickly removed, and xAI said it was working to "actively working to remove the inappropriate posts," as quoted in the report. Following the incident, Linda Yaccarino, the then-CEO of X, resigned from her position, as reported by Newsweek. According to the Newsweek report, Grok's recent controversy has raised broader concerns over the risks of using powerful, fast-evolving commercial AI within sensitive government and military contexts. The timing of the DOD deal is also notable as Musk's once-close relationship with US President Donald Trump has reportedly soured, culminating in Trump threatening to pull federal contracts from Musk's companies, as per the report. Is Grok really being used by the Pentagon? Yes. Musk's company, xAI, announced a contract with the DOD to use Grok in government and defense work, as per the Newsweek report. How much is the Grok government contract worth? The contract is worth up to $200 million, according to the report.

Trump DOD Gives $200M Contract To Elon Musk's AI Company

The company's signature chatbot recently called itself "MechaHitler." In what sure seems like a bad idea, the Defense Department has awarded a multimillion-dollar contract to an AI company whose signature product, the chatbot Grok, began calling itself "MechaHitler" last week. The contract, awarded to Elon Musk's xAI, has a $200 million ceiling. Anthropic, Google and OpenAI also signed similar contracts with the DOD Monday. The Chief Digital and Artificial Intelligence Office (CDAO) confirmed the contracts in a statement that praised the technology itself while offering little insight into how it might actually be used. "Leveraging commercially available solutions into an integrated capabilities approach will accelerate the use of advanced AI as part of our Joint mission essential tasks in our warfighting domain as well as intelligence, business, and enterprise information systems," the statement read. Separately on Monday, xAI also announced it would also pursue deals with other federal, state and local agencies under an initiative it's calling "Grok for Government." The program allows government agencies to purchase xAI products via the General Services Administration (GSA) schedule. Which means, if xAI gets its way, Grok will not only have access to -- but will be paid handsomely by U.S. taxpayers to ingest -- data pertaining to: national security, critical science and health care, in addition to data generated in "classified and other restricted environments." Grok is a product of xAI, the AI tech company that acquired X (formerly Twitter) in March in a bit of dubious bookkeeping that conveniently allowed Musk to skirt responsibility for Twitter/X's sharp decline in value under his ownership. Musk was a close ally of President Donald Trump until the two had a spectacular falling out last month over Trump's deficit-swelling signature piece of legislation. Despite the very public breakup, Musk's various companies nevertheless appear to have landed large contracts both with the federal government and in foreign countries that previously rejected him. The Federal Aviation Administration has been pushed to grant a $2 billion contract to Musk's satellite-based internet company, Starlink, for instance. And Starlink reportedly had U.S. State Department officials exert "maximum pressure" on developing countries to open themselves up for business.

Elon Musk's AI Chatbot Grok to be Used by Federal Agencies

Taliban Revenge Killing Puts Court Spotlight on Documentary Ethics The government is accelerating adoption of artificial intelligence technology, beginning with the U.S. Department of Defense using Grok, the AI chatbot embedded into X. Elon Musk's startup xAI announced on Monday a $200 million government contract as the Defense Department aims to address national security concerns with AI technology. It's also rolling out what it called "Grok for Government," a suite of products that can be customized for specific uses across science and healthcare, among other things. The partnership was unveiled on the heels of Grok last week launching into an antisemitic tirade after it was updated to reduce its reliance on mainstream media sources. In a June X post, Musk, who oversaw DOGE and is now on the outs with President Trump over his spending and tax bill, prompted users to reply with "divisive" and "politically incorrect" facts to train the chatbot. Anthropic, Google and OpenAI were also tapped to receive awards, according to the Chief Digital and Artificial Intelligence Office. "The adoption of AI is transforming the Department's ability to support our warfighters and maintain strategic advantage over our adversaries," said department chief Doug Matty in a statement. "Leveraging commercially available solutions into an integrated capabilities approach will accelerate the use of advanced AI as part of our Joint mission essential tasks in our warfighting domain as well as intelligence, business, and enterprise information systems." "Grok for Government" will be available to federal, state, local and national security customers who will be able to use the technology to streamline certain processes and "address unsolved problems in fundamental science," xAI said. The government has been implementing a commercial-first approach to hastening AI adoption, with the Defense Department awarding similar contracts with OpenAI, Microsoft and Anthropic. "These advanced AI solutions will enable the DoD to effectively address defense challenges and scale the adoption of agentic AI across enterprise systems to drive innovation and efficiency with agile, proven technology," Jim Kelly, vice president of Federal Sales for Google Public Sector, wrote in a blog post. "This milestone demonstrates a strengthened partnership between Google Public Sector and DoD CDAO to accelerate the federal adoption of cutting-edge data, analytics, and AI."

Elon Musk's xAI inks Pentagon deal for contentious Grok chatbot

NEW YORK -- Elon Musk's xAI, which features a large language model that has spewed Hitler-supporting rhetoric and antisemitic tropes, said Monday it has signed a deal to provide its services to the U.S. Department of Defense. Launched at the end of 2023, Grok has rarely been out of the headlines for its offensive gaffes, and will now offer its services as "Grok for Government." In addition to the Pentagon contract, "every federal government department, agency, or office (can now) purchase xAI products" thanks to its inclusion on an official supplier list, xAI added. After an update on July 7, the chatbot praised Adolf Hitler in some responses, denounced on X "anti-white hate", and described Jewish representation in Hollywood as "disproportionate." xAI apologized on Saturday for extremist and offensive messages, and said it had corrected the instructions that led to the incidents. The new version of the chatbot, Grok 4, presented on Wednesday, consulted Musk's positions on some questions it was asked before responding, an AFP correspondent saw. The contract between xAI and the U.S. Department of Defense comes even as Musk and President Donald Trump are locked in a bitter feud. The two men became close during Trump's latest run for the presidency and, following the inauguration, the Republican billionaire entrusted Musk with managing the new agency known as DOGE to slash the government by firing tens of thousands of civil servants. After ending his assignment in May, the South African-born entrepreneur publicly criticized Trump's major budget bill for increasing government debt. The president and the businessman engaged in heated exchanges on social media and in public statements before Musk apologized for some of his more combative messages. The government and the defence sector are considered a potential growth driver for AI giants. Meta has partnered with the start-up Anduril to develop virtual reality headsets for soldiers and law enforcement, while in June OpenAI secured a contract to provide AI services to the U.S. military.