Elon Musk plans to put ads inside Grok AI responses

AI computing power doesn't come cheap, and someone has to pay the bill. In the wake of former CEO Linda Yaccarino's departure, X is looking for new ways to revive its advertising business.

Grok gets a day job

Elon Musk told advertisers during a live discussion on Wednesday that X plans to introduce ads directly into Grok's responses, according to a report from the Financial Times.

Musk explained that the team's initial focus was simply making Grok the smartest and most accurate AI in the world. Now, attention has to shift toward paying for all those expensive GPUs.

Under this plan, marketers will be able to pay to appear in suggestions generated by the chatbot. Musk noted that when a user asks Grok to solve a specific problem, serving an ad with a tailored solution at that exact moment would be ideal. Musk also intends to leverage tech from xAI, which acquired X for $45 billion earlier this year, to improve ad targeting across the social network.

Why it matters

Monetizing chatbot conversations is the tech world's most tempting path to offset massive GPU infrastructure bills. But turning answers into ad inventory is playing with fire. The value of an AI assistant relies entirely on trust; the moment users suspect Grok is recommending a brand because of a sponsor check rather than merit, its credibility takes a hit. We think it makes financial sense on paper, but X will need to be remarkably transparent if it doesn't want to drive power users away.