xAI Announces ‘Grok for Government’ with $200 mn U.S. Government Deal
Offering includes Grok 4, Deep Search, Tool Use, and customised models for classified applications.
Elon Musk’s AI firm xAI has secured a $200 million contract with the U.S. Department of Defense to supply its Grok for Government AI suite to federal, state, and national security agencies.
Available via the General Services Administration (GSA) schedule, the offering includes Grok 4, Deep Search, Tool Use, and customised models for classified applications, marking a major expansion of xAI’s footprint in public-sector AI.
“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 blog post.
The DoD’s Chief Digital and AI Officer, Doug Matty, praised the decision: “The adoption of AI is transforming the Department's ability to support our warfighters and maintain strategic advantage over our adversaries.”
The deal follows a week after Grok’s controversial “MechaHitler” antisemitic incident, prompting xAI to apologize and promise software safeguards.
Despite this, the Pentagon continues to invest in commercial AI, awarding similar $200 million ceiling agreements to Google, Anthropic, and OpenAI.
xAI is projecting more than $13 billion in annual earnings by 2029, according to figures shared by Morgan Stanley, which is arranging a $5 billion debt sale.
The bank provided select investors—those committing at least $50 million—access to xAI’s financials.
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