The Pentagon announced on Monday (July 14) that Elon Musk’s artificial intelligence company xAI, along with three other well-known tech companies, have been awarded a contract worth up to $200 million by the U.S. Department of Defense (DOD).
According to a report by The Hill, xAI, Anthropic, Google, and OpenAI have all received contracts with the same funding cap from the Department of Defense’s Chief Digital and Artificial Intelligence Office (CDAO) to help advance the application of advanced artificial intelligence technologies within the military organization.
Doug Matty, the Chief Digital and Artificial Intelligence Officer at the Department of Defense, stated in a release, “The adoption of artificial intelligence technology is enhancing the Department of Defense’s capabilities to support our servicemen and women and maintain strategic advantage against our adversaries.”
On the same day, Musk’s AI company xAI unveiled a set of AI products designed specifically for U.S. government clients, called “Grok for Government.”
xAI stated that through the General Services Administration’s procurement program, other federal government departments can also purchase the product.
In a public statement, xAI mentioned, “The United States is a world leader in the field of artificial intelligence, largely due to a tradition that values innovation and strong investments in engineering and science. We are pleased to contribute to this unique nation that sustains xAI.”
At the end of March, billionaire Musk announced that his AI startup xAI had merged with the social platform X through an all-stock transaction to form a new holding company named “xAI Holdings Corp.” This move marked a deep integration of Musk’s two major tech ventures.
Based on Musk’s statement on the X platform, the merged new holding company is valued at up to $113 billion.
Musk stated at the time, “The future of xAI and X are inseparable. Today, we are taking a formal step towards combining data, models, computing power, distribution channels, and talent.”
At the end of June, Musk and President Trump once again publicly quarreled. After Musk criticized the “Big and Beautiful Act” that Trump vigorously supported, Trump retaliated by raising concerns about the substantial government funds flowing into Musk’s companies.
In the early hours of July 1, President Trump posted on social media, stating that Musk’s companies had received significant federal subsidies and suggested the Department of Efficiency investigate any government spending that flowed into Musk’s business empire.