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Musk’s xAI to Invest Over $20 Billion in Mississippi Data Center

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xAI, the artificial intelligence company founded by Elon Musk, will invest more than $20 billion to build a large-scale data center in Southaven, Mississippi, state Governor Tate Reeves said on Thursday.

The investment comes as booming demand for generative AI drives tech companies to sharply expand computing infrastructure. Data centers have become a focal point for spending by AI startups and hyperscalers seeking to train increasingly powerful models.

According to the governor’s statement, xAI expects to begin operations at the Southaven data center in February 2026. Musk had previously announced on December 30 that xAI had acquired a data center named “MACROHARDRR,” saying the facility would lift the company’s total computing capacity to 2 gigawatts, though he did not disclose the investment size or location at the time.

The Southaven site is located near a power plant recently acquired by xAI and close to its existing data center footprint in Memphis, Tennessee, the statement said. Memphis is home to xAI’s flagship supercomputer cluster, Colossus, which the company has described as the largest in the world.

The expansion highlights xAI’s aggressive push to compete more directly with leading AI developers such as OpenAI and Anthropic, whose ChatGPT and Claude models dominate much of the current generative AI market.

xAI’s spending underscores the heavy cash demands of the AI race. Bloomberg reported earlier on Thursday that the company burned $7.8 billion in cash during the first nine months of the year, reflecting the high cost of advanced data center hardware and large-scale model training.

Grok AI Floods X With Sexualized Images, Raising Global Alarm

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X’s built-in AI chatbot Grok has generated a wave of sexualized images of women — and in some cases minors — after users prompted the tool to digitally alter real photos, a Reuters investigation found.

One victim, Brazilian musician Julie Yukari, said Grok created near-nude images of her after users asked the bot to strip her clothing from a harmless photo. Similar incidents have appeared widely on X, with Reuters documenting dozens of successful requests to place women in highly revealing outfits. Reuters also identified several cases involving sexualized images of children.

The backlash has spread internationally. French ministers said the content was “manifestly illegal” and reported X to prosecutors and regulators, while India’s IT ministry warned the platform had failed to stop the generation of obscene material. U.S. regulators including the Federal Communications Commission and the Federal Trade Commission declined to comment.

Experts said the outcome was foreseeable. AI watchdogs warned last year that Grok’s image tools could easily be abused to create non-consensual deepfakes. “This was entirely predictable and avoidable,” said Dani Pinter of the National Center on Sexual Exploitation, blaming weak safeguards and content moderation.

X owner Elon Musk appeared to mock the controversy by responding with laughing emojis to AI-generated bikini images, including ones depicting himself. xAI, which develops Grok, previously dismissed reports of sexualized images of minors with the statement: “Legacy Media Lies.”

Neuralink Plans High-Volume Brain Implant Production by 2026, Musk Says

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Neuralink will begin “high-volume production” of its brain–computer interface implants and shift to a fully automated surgical procedure in 2026, according to a statement by Elon Musk.

Musk shared the update on the social media platform X on Wednesday. Neuralink did not immediately respond to a request for comment from Reuters.

The Neuralink implant is designed to help people with neurological conditions such as spinal cord injuries by enabling direct communication between the brain and computers. The company’s first patient has demonstrated the ability to play video games, browse the internet, post on social media and control a laptop cursor using only their thoughts.

Neuralink began human trials of its brain implant technology in 2024, after resolving safety concerns raised by the U.S. Food and Drug Administration. The regulator had initially rejected the company’s application in 2022, citing risks related to the device and surgical process.

In September, Neuralink said that 12 people worldwide with severe paralysis had received its implants and were using them to control both digital and physical tools through neural signals. The company has positioned the technology as a potential breakthrough for restoring independence to patients with limited mobility.

The startup has also attracted strong investor interest. In June, Neuralink raised $650 million in a funding round, providing capital to scale manufacturing, expand clinical trials and advance automation plans ahead of its targeted 2026 production push.