By Raphael Satter, Echo Wang and Jeffrey Dastin<\/p>\n
MEMPHIS, Tennessee, April 23 (Reuters) – The multiple investigations into xAI\u2019s creation and dissemination of sexually abusive imagery may lead the company to lose access to certain markets, parent company SpaceX warned in a prospectus reviewed by Reuters.<\/p>\n
In a section \u200con risk factors, the S-1 regulatory filing said a number of agencies around the world were \u201cactively investigating and making inquiries relating to social media \u200cor the use of AI\u201d in relation to advertising, consumer protection and the distribution of harmful content, among other matters.<\/p>\n
The news comes after SpaceX hosted analysts at its Colossus supercomputer in Memphis, Tennessee, on \u200bThursday, gearing up for its $1.75 trillion IPO expected this summer. U.S. securities law requires companies to disclose such risk factors, alerting investors to potential pitfalls while also helping protect companies against future legal liability. The disclosures do not necessarily mean each listed outcome is expected to occur.<\/p>\n
One challenge SpaceX highlighted was that it faced \u201callegations that our AI products were used to create nonconsensual explicit images or content representing children in sexualized contexts,” the S-1 document said. Such regulatory inquiries could expose SpaceX to lawsuits, liability and government action \u2013 \u201cincluding loss \u200cof access to certain markets, which has occurred in the \u2060past,\u201d the document stated.<\/p>\n
SpaceX and xAI did not immediately respond to requests for comment. It was not clear whether potential regulatory action could prevent SpaceX as a whole from accessing certain markets or just its subsidiary, xAI, specifically.<\/p>\n
WORLDWIDE SCRUTINY OVER GROK IMAGES<\/p>\n
Though the \u2060regulatory filing’s risk factors gave as an example a probe launched by the Irish Data Protection Commission in February, xAI has faced scrutiny worldwide over an explosion of sexualized images. The content, which was particularly visible in late 2025 and early 2026, featured images of nearly naked women and children on X, the company\u2019s social media platform.<\/p>\n
XAI said in January that it had added \u200bmeasures \u200bto block user requests for sexualized images of real people, and it said it stops \u200busers from generating such content in jurisdictions where that is illegal.<\/p>\n
The \u200cimages \u2013 which were generated by xAI\u2019s in-house chatbot, Grok \u2013 had shown women and sometimes minors in revealing bikinis or underwear, or edited into degrading or gruesome poses. The pictures caused widespread alarm around the world; one group of researchers estimated there were about 3 million sexualized images, while U.S. lawmakers demanded that Google owner Alphabet and Apple yank Grok and X from their app stores. SpaceX CEO Elon Musk said around that time that he knew of “literally zero” naked underage images made by Grok.<\/p>\n
A variety of investigations \u2013 launched earlier in Canada, Britain, Brazil, California and elsewhere \u2013 are ongoing. In France, for example, Musk on Monday flouted a legal summons to answer questions from \u200cprosecutors concerning allegations of algorithmic abuse, fraudulent data extraction and complicity in the distribution of \u200bchild sexual abuse material.<\/p>\n
STAKES HIGH AS PROBES CONTINUE<\/p>\n
The S-1 warning around market access illustrates the stakes \u200bof the various investigations into xAI, especially ones around the AI generation of \u200balleged child sexual abuse images and nonconsensual sexual images of women. Creation of such imagery can be a crime in some \u200cjurisdictions, and its dissemination is an emotive issue that can rapidly \u200bmobilize public opinion.<\/p>\n
XAI’s curbs on Grok appear to \u200bhave slowed but not stopped the flow of abusive material. In February, Reuters reported that Grok was generating sexualized imagery of people even when users explicitly warned the chatbot that the subjects of those images did not consent. Last week, NBC News found that Grok was still publicly generating sexualized \u200bimages, including of actors and pop stars.<\/p>\n
X has been banned \u200cbefore in various jurisdictions, including in 2024 in Brazil, where the site was blocked following its refusal to comply with a judge\u2019s order. \u200bThe company later relented and the ban was lifted.<\/p>\n
(Reporting by Raphael Satter in Memphis, Tennessee, Echo Wang in New York and Jeffrey Dastin \u200bin San Francisco; Writing by Raphael Satter; Editing by Kenneth Li and Matthew Lewis)<\/p>\n","protected":false},"excerpt":{"rendered":"By Raphael Satter, Echo Wang and Jeffrey Dastin MEMPHIS, Tennessee, April 23 (Reuters) – The multiple investigations into…\n","protected":false},"author":2,"featured_media":627586,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23],"tags":[64,63,42299,304160,128,285,5437,3123],"class_list":{"0":"post-627585","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-space","8":"tag-au","9":"tag-australia","10":"tag-investigations","11":"tag-regulatory-inquiries","12":"tag-science","13":"tag-space","14":"tag-spacex","15":"tag-xai"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/627585","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=627585"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/627585\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/627586"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=627585"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=627585"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=627585"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}