OpenAI wins $200 million US defense contract

ChatGPT-maker OpenAI was awarded a $200 million contract to provide the US Defense Department with artificial intelligence tools, the Pentagon said in a statement on Monday.

"Under this award, the performer will develop prototype frontier AI capabilities to address critical national security challenges in both warfighting and enterprise domains," the Pentagon said.

The work will be primarily performed in and near Washington with an estimated completion date of July 2026, the Pentagon said.

The news follows the swearing in on Friday of several Silicon Valley tech heavyweights – including OpenAI’s chief product officer, Kevin Weil – into the US Army Reserves as senior advisors of “Detachment 201,” part of the Army’s new Executive Innovation Corps to drive tech transformation.

Others taking on the part-time military positions include Meta’s chief technology officer (CTO), Andrew Bosworth; Palantir’s CTO, Shyam Sankar; and Bob McGrew, an advisor at Thinking Machines Lab who was previously OpenAI’s chief research officer.

The quad is expected to “work on targeted projects to help guide rapid and scalable tech solutions to complex problems,” the US Army anouncement said.

The White House's Office of Management and Budget released new guidance in April directing federal agencies to ensure that the government and "the public benefit from a competitive American AI marketplace." The guidance had exempted national security and defense systems.

OpenAI said last week that its annualized revenue run rate surged to $10 billion as of June, positioning the company to hit its full-year target amid booming AI adoption.

In March, the AI start-up said it would raise up to $40 billion in a new funding round led by SoftBank Group at a $300 billion valuation.

The Sam Altman-run OpenAI had 500 million weekly active users as of the end of March.