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Today’s tech news below. —Andrew Nusca

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After slashing federal contracts at DOGE, Elon Musk wins…a Pentagon contract

Elon Musk’s xAI has signed an important new customer: the U.S. government. 

The two-year old AI company said in a blog post Monday that it has signed a contract worth up to $200 million with the Department of Defense.

xAI also announced that it had been added to the General Services Administration schedule, meaning that xAI products will now be available for purchase across every government office and agency.

xAI’s new DoD contract is part of a new effort to develop AI agent workflows across a “variety of mission areas,” the Chief Digital and Artificial Intelligence Office said in a press release, without giving many more specifics. 

Google, OpenAI, and Anthropic were also awarded up to $200 million contracts as part of the new effort.

A number of tech companies, including Meta, Amazon, and Google, have either started working with or upped their work with the U.S. government in the last year as the taboo in Silicon Valley of working with the Defense Department has fallen away.

xAI’s new ties with the Pentagon are likely to raise eyebrows, not least because just one week earlier, the company released an update to its Grok AI model that caused it to spew racist comments, including referring to itself as a “MechaHitler.” 

There’s also the fact that xAI’s CEO, Musk, has spent the last six months trying to trim “wasteful spending” in the government via the Department of Government Efficiency (DOGE).

Now xAI is vying to get the U.S. government to add many more contracts that could cost hundreds of millions of dollars. —Jessica Mathews

Amazon’s Prime Day recap was missing one key metric

Every year, Amazon holds a “record” Prime Day, and every year the company boasts about the performance of the annual sales event in a press release. 

Last year, Amazon noted that independent sellers “sold more than 200 million items during the Prime Day event.” 

In 2023, Prime members “purchased more than 375 million items worldwide.” In 2022, that number was more than 300 million. In 2021, it was north of 250 million. 

This year, what stood out to this longtime Amazon watcher is that the company didn’t disclose anything about the number of items sold. 

The last time it made that choice was 2020, when nothing normal was happening anywhere in the world, and Prime Day was moved from summer to October. 

It’s unclear exactly why Amazon decided to withhold that number for 2025, but this Prime Day was odd for a few reasons. Sellers, and brands big and small, had to come up with different strategies to contend with tariff chaos. And they’re trying to woo increasingly pessimistic consumers. 

Those factors could be weighing on the company’s decision to withhold exact numbers. 

It’s possible this Prime Day was a success. Amazon said in this year’s recap that the four days of Prime Day 2025 outsold any other four-day period that included previous Prime Days. But historically, the event hasn’t run longer than two days. 

We’ll see if Amazon provides more details in future earnings reports. —Jason Del Rey

Alexa von Tobel’s new podcast wants to reset American ambition

Alexa von Tobel believes American ambition has corroded in recent years—and that it’s time for a reset, one that revives ambition to its most sweeping, optimistic form. 

This is especially true for venture capitalists and entrepreneurs, the Inspired Capital cofounder and LearnVest founder tells Fortune.

“During a period of capital being effectively free, it became very easy to start companies,” says von Tobel, referencing ZIRP (zero interest rate policy) induced booms. That was a great thing because it made entrepreneurship go mainstream.

“But as entrepreneurship became mainstream and capital was easy to access, we just started seeing a lot of incremental ideas,” she adds.

Now that’s beginning to change.

Von Tobel has been thinking about this as an investor, backing companies like ShopMy, Solace, and Teamshares. But the longtime podcast host has also been considering the state of entrepreneurial ambition from a narrative perspective.

Her new, biweekly Inspired podcast, which takes its name from her firm and ethos, features von Tobel interviewing entrepreneurs about taking truly ambitious swings.

Von Tobel’s first guest on the new podcast is Ben Lamm, founder and CEO of Colossal Biosciences, famous for its de-extinction efforts. Astro Teller, Captain of Moonshots at Google X, and Dr. Becky Kennedy, founder and CEO of Good Inside, are also on tap.

“I believe we have more problems than we’ve ever seen,” she tells Fortune. “And when I really dug deep on what I hope we see more of in the world it’s—no pun intended—inspiring people to dream bigger, think bigger.” —Allie Garfinkle

More tech

—Cognition acquires Windsurf shortly after Google’s $2.4 billion investment. That was fast!

—Tesla faces a federal jury in Florida. Allegations of Autopilot fault in a fatal 2019 crash.

—Should Meta abandon Behemoth? It might just abandon its open source AI model for a new closed one.

—Apple iPhone Fold? Reportedly coming in the second half of 2026.

—Nvidia to resume H20 AI chip sales to China. The White House makes an about-face on its own chip export restrictions.

—Hackers temporarily took over Elmo’s X account, and, well, uh…yikes.

—Amazon’s Kiro AI coding tool turns vibe coding forays into “viable code.”

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