Pentagon awards $800 million in AI contracts to tech giants

On 14 July 2025, DOD announced that four of America’s most prominent AI firms—Anthropic, Google, OpenAI, and xAI—were each awarded contracts worth up to $200 million to supply advanced AI solutions for key national security missions, per a CDAO press release and reported by NextGov.

DOD’s Chief Digital and Artificial Intelligence Office (CDAO) is emphasizing rapid access to commercial AI advances. “The adoption of AI is transforming the Department’s ability to support our warfighters and maintain strategic advantage,” said Chief Digital and AI Officer Dr. Doug Matty. Through agentic AI workflows and large language models, DOD intends to modernize Joint warfighting, intelligence, business and enterprise information systems, integrating the latest generative AI into projects ranging from health care to logistics.

Who the winners are and what they’ll do

• Anthropic will deliver its custom Claude Gov models, specifically designed for classified, defense-specific environments.
• Google will provide government-specific AI tools and secure cloud infrastructure, already cleared for handling the most sensitive data.
• OpenAI will pilot its “OpenAI for Government” initiative, focusing on administrative optimization, cyber defense, and military health care, all within strict ethical usage guidelines. per the company.
• xAI (Elon Musk) will roll out its new “Grok for Government” tool suite through the General Services Administration, making its frontier models accessible across agencies.

Tags: DOD, National Security, Artificial Intelligence, Google, Anthropic, OpenAI, xAI, Pentagon, Contracts