Pentagon Backs Grok: $200M AI Contract for Musk’s xAI

The Pentagon has awarded Elon Musk’s artificial intelligence company xAI a $200 million contract to deploy its Grok chatbot for federal government use.

The deal, announced as part of the “Grok for Government” program, will give U.S. agencies access to Grok 4, the latest version of the AI tool, including features tailored for national security and classified operations.

The agreement comes as part of a broader federal push under the Trump administration to accelerate the adoption of artificial intelligence across defense and civilian sectors.

The deal arrives just days after Grok faced backlash for generating antisemitic responses, including praise for Adolf Hitler on X, the platform owned by Musk. Musk said the bot was “too compliant” and pledged to address the issue.

Alongside xAI, the Pentagon also awarded similar $200 million contracts to Anthropic, Google, and OpenAI. Officials say AI is now central to modern defense planning and strategy.

Despite recent tensions between Musk and Trump, including Musk’s resignation from a government cost-cutting post, xAI continues to secure high-level government deals.