Elon Musk’s Grok struggles as SpaceX leans on Anthropic for AI compute

Grok just isn’t hooking users

Ever tried a new app only to go back to your old favorite? That’s what’s happening with Elon Musk’s Grok AI. People tried it, but many are leaving.

New data shows Grok lost over 10% of its daily users between March and April 2026 alone. For a chatbot named after a sci-fi word for deep understanding, folks just aren’t connecting with Elon Musk’s Grok the way they once did.

Grok fell from 2nd to 5th place

Remember when you were second in class? That felt good. Back in January, Elon Musk’s Grok was the second-most used AI app on phones worldwide.

But by April, it tumbled to fifth place. Rivals like Claude, Gemini, and DeepSeek all zoomed ahead. That’s a fast fall in just a few months. When you stop moving forward in the AI race, everyone else zips right past you.

SpaceX rented compute to a rival

Here’s a strange twist. SpaceXAI, the SpaceX division connected to Grok, signed a compute deal giving Anthropic access to Colossus 1. Anthropic is the company behind Claude, one of Grok’s biggest rivals.

Think of it like a pizza shop renting oven space to the restaurant next door. Colossus 1 has more than 220,000 Nvidia GPUs, and Anthropic will use that compute to support Claude.

Reuters reported that Musk said SpaceX had moved its own AI training work to Colossus 2, so the deal looks less like Grok losing all its compute and more like SpaceX turning its AI infrastructure into a business of its own.

Government workers aren’t picking it

The US government is a massive customer. But when Reuters checked over 400 official AI projects last year, Grok showed up only three times. Just three!

OpenAI appeared in more than 230 of those projects. That’s a massive gap. If government agencies won’t pick Grok even when it’s nearly free, that’s a big warning sign for its future in the business world.

Businesses are picking Claude and Gemini

Companies don’t buy AI for fun. They buy what works. Enterprise Technology Research data reported by The Wall Street Journal found that 48% of technology leaders said their organizations were using Claude and planned to keep using it in March, up from 21% a year earlier.

Grok was far behind at 7%, up from 4%. Gemini also climbed to 40%, up from 27%. Corporate AI buyers are still giving Grok a much smaller share of their attention than Claude and Gemini.

Fun fact: Claude’s web visits are up 761% year-over-year, and its mobile app users have skyrocketed 1,205%. Grok’s growth? Just 83.5% on mobile. That’s like sprinting against someone on a motorcycle.

The Nudify scandal hurt badly

Back in January, Grok had a big moment. Downloads reportedly topped 20 million. But the attention quickly turned toxic after reports and lawsuits alleged that Grok could be used to generate nonconsensual sexualized images of real people, including minors.

In March, three Tennessee plaintiffs, including two minors, sued xAI, alleging that real photos of them were turned into sexually explicit images. xAI said in January that it had added restrictions on editing images of real people in revealing clothing and generating such images where illegal.

Most of the founders have left

Would you trust a restaurant where the head chefs kept leaving? That’s the concern around xAI, the company behind Grok. Fast Company reported that more than 80 people, including cofounders and AI engineers, had left xAI in recent months.

Every xAI cofounder other than Elon Musk has reportedly exited. Reuters and the Financial Times also reported that some researchers left because of burnout tied to Musk’s “extremely hardcore” work demands or because they received better offers from rivals. Heavy turnover can make it harder to build and refine a world-class AI product.

Free users keep getting locked out

Remember when you could play a game for free, and then suddenly the best tools required an upgrade? Grok still offers free access, but xAI markets SuperGrok for higher limits, priority access, and multi-agent reasoning.

Its image and video tools remain a major part of the product, and reporting says xAI restricted some image-generation access to paying users after backlash over nonconsensual sexualized images. That makes the free experience feel more limited at a time when AI users have plenty of competing options.

Orbital data centers are a long shot

SpaceX has a wild idea for the future, putting data centers in space. They want to launch up to 1 million satellites to run AI from orbit. That sounds like science fiction. And right now, it is.

The company is losing billions and piling up $29 billion in debt. Betting on space computers to save a struggling chatbot is a huge gamble. You have to win the race on Earth before you can win it in the stars.

The $1.75 trillion valuation looks shaky

SpaceX is aiming for a massive IPO. A huge part of that value comes from promising big AI profits through Grok. But if almost no one in the government uses it, and businesses are picking other tools, that number looks shaky.

One expert called Grok’s poor government adoption a canary in the coal mine. That means it’s an early warning sign. Without government validation, that $1.75 trillion price tag might be way too high.

Grok did win a $200 million contract with the Pentagon, which sounds impressive. But here’s the catch: inside the building, many staffers still choose other AIs. One source said workers at DARPA prefer Google’s Gemini for engineering and Claude for coding.

They said Grok is just not the best model out there. Winning a contract is one thing. Winning hearts and minds is another. When the people who actually use AI every day pick something else, that’s a real problem.

If you’re curious why some people still believe Grok could become a major AI force, check out Grok 4’s brainpower, which may outthink you for a closer look at what’s fueling the hype.

Can Grok still make a comeback?

Can Grok turn things around? Maybe. Elon Musk has pulled off surprises before with Tesla and SpaceX. Never say never. But right now, the numbers don’t lie. Users are leaving, businesses are saying no, and even the government is barely using it.

To get back in the race, Grok needs a major improvement fast. Until then, most folks will stick with the ChatGPT and Claude they already know and trust. Sometimes being first isn’t as important as being best.

If you want to see how much faith investors are still placing in Elon Musk’s long-term vision, check out Elon Musk embraces bold $1.75 trillion SpaceX valuation for the full story behind the numbers.

Have you tried Grok, or do you stick with ChatGPT and Claude? Drop your take in the comments and give this slideshow a thumbs up if you found it helpful.

This slideshow was made with AI assistance and human editing.

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