As Grok flounders, SpaceX bets future on beating Big Tech at AI

# As Grok flounders, SpaceX bets future on beating Big Tech at AI Source: [https://arstechnica.com/ai/2026/05/as-grok-flounders-spacex-bets-future-on-beating-big-tech-at-ai/](https://arstechnica.com/ai/2026/05/as-grok-flounders-spacex-bets-future-on-beating-big-tech-at-ai/) Corporate use of[Anthropic’s Claude](https://arstechnica.com/ai/2026/05/claude-codes-product-lead-talks-usage-limits-transparency-and-the-lean-harness/)and the[Google Gemini](https://arstechnica.com/google/2026/05/google-announces-agent-optimized-gemini-3-5-flash-and-a-do-anything-model-called-omni/)AI models has also soared in the past year, according to the market research firm Enterprise Technology Research\. The firm’s survey of 500 people—also highlighted by The Wall Street Journal—showed reported Claude usage among respondents’ companies jumping from 21 percent to 48 percent between 2025 and 2026\. Similarly, reported Gemini usage rose from 27 percent to 40 percent in the same time period\. Grok’s corporate usage also saw a smaller bump, rising from 4 percent to 7 percent\. “We have launched Grok Business, Grok Enterprise, Grok API, and xAI Gov, products that we believe will be attractive to enterprises and governments, and we expect substantial opportunities to acquire new customers,” SpaceX wrote in its S\-1 filing\. However,[Reuters reported](https://www.reuters.com/world/grok-falls-flat-washington-undercutting-spacexs-ai-growth-story-2026-05-21/)that “xAI’s Grok chatbot has been a flop with one of the world’s largest customers—the US government\.” The Reuters examination of AI inventory records from federal agencies in 2025 showed just three public mentions of using either xAI or Grok out of more than 400 publicly disclosed examples of AI use by the government\. The peak of Grok’s download popularity coincided with a January 2026 update that allowed Grok users to generate millions of sexualized images of women and children by using real photos to[virtually undress](https://arstechnica.com/tech-policy/2026/01/musk-still-defending-groks-partial-nudes-as-california-ag-opens-probe/)people—a situation that persisted for weeks before developers addressed the situation\. The AI[nudifying scandal](https://arstechnica.com/tech-policy/2026/01/asking-grok-to-delete-fake-nudes-may-force-victims-to-sue-in-musks-chosen-court/)led to lawsuits against xAI and spurred the European Union to[ban nudifying apps](https://www.europarl.europa.eu/news/en/press-room/20260427IPR42011/ai-act-deal-on-simplification-measures-ban-on-nudifier-apps)\. Grok also still incorporates features such as “Spicy” and “Unhinged” modes\. The SpaceX financial disclosure described those features as presenting “heightened risks, including reputational harm, the generation of potentially explicit content and misinformation or deceptive outputs, potential nonconsensual or exploitative imagery, intellectual property infringement, or content that could be viewed as exploitative, harmful, harassing, abusive, or discriminatory\.” From a business standpoint, SpaceX acknowledged that this leaves the company open to “the risk of regulatory scrutiny, enforcement actions, litigation, or claims of harm, as well as reputational damage, user or advertiser backlash, or limitations on our ability to distribute or monetize our products in certain jurisdictions or through certain partners\.”