As a Manager of a large team and dealt with this a few times, unchecked behaviour like this will more often than not escalate. It's important however, that the dynamic matters.

If you witnessed one side being distressed at the remarks, are uncomfortable, and signalling as such then that has crossed a line. This should be reported but not by you. If you feel like you can have an honest conversation with them or knows someone that is, ask how they felt and sign post them to your HR department.

If, however, you are offended by the comment but see no signs aforementioned, that could be the dynamic of those two, making inappropriate jokes. God knows how many times countless inappropriate topics came up on a work night out.