Military & Defense Contracts

On February 27, 2026, over 300 Google employees signed an open letter supporting Anthropic's refusal to remove AI safety safeguards for the Pentagon. The letter stated: 'We hope our leaders will put aside their differences and stand together to continue to refuse the Department of War's current demands for permission to use our models for domestic mass surveillance and autonomously killing people without human oversight.' Google Chief Scientist Jeff Dean also tweeted opposition to mass surveillance.

On February 23-24, 2026, xAI reached agreement with the Pentagon to deploy Grok on classified military systems at Impact Level 5 (IL5) - the highest military AI security classification. Unlike Anthropic, xAI accepted the Pentagon's 'all lawful use' standard without restrictions on autonomous weapons or mass surveillance. The deal positions Grok to replace Claude across up to 3 million DoD personnel, with potential applications in intelligence analysis, weapons development, and battlefield operations.

On February 22-28, 2026, OpenAI negotiated and signed an agreement with the Pentagon for classified network deployment. Altman claims the deal includes safeguards aligned with Anthropic's red lines, though the language differs meaningfully: OpenAI requires "human responsibility for use of force" while Anthropic requires "human in the loop" for autonomous weapons. OpenAI also secured cloud-only deployment (not edge systems like drones) and the right for models to refuse tasks. Critics note "human responsibility" (accountability) is a weaker standard than "human in the loop" (authorization required). CNN reported it remains unclear what actually differs between OpenAI's accepted terms and Anthropic's rejected ones.

In January-February 2026, Anthropic and the Pentagon reached a standoff over a $200 million contract. Anthropic demanded "human in the loop" restrictions - specifically that Claude not be used in "fully autonomous weapons (those that take humans out of the loop entirely)." CEO Amodei stated "frontier AI systems are simply not reliable enough to power fully autonomous weapons" and offered to work on R&D to improve reliability. The Pentagon demanded "all lawful use" language. Defense Secretary Hegseth gave a Friday 5pm deadline; Amodei refused. Trump ordered all agencies to cease Anthropic use and Pentagon designated Anthropic a "supply chain risk" - language normally reserved for foreign adversaries.

In January 2026, Palmer Luckey publicly supported President Trump's plan to limit pay for defense contractor leaders and crack down on the defense industry, telling Bloomberg TV 'I think it's even good maybe to scare people sometimes.' He revealed he pays himself only $100,000 per year at Anduril. While noting some changes 'might not necessarily help the defense space,' he stood by Trump's policies despite the president's rebuke of defense companies and their CEOs.

On December 26, 2025, China imposed sanctions on Palmer Luckey along with 9 other US defense executives and 20 companies for their role in US arms sales to Taiwan. Luckey is barred from entering China and from conducting business there. Anduril had jointly manufactured the Barracuda 500 autonomous cruise missile with Taiwan's National Chung-Shan Institute. Luckey publicly celebrated the sanctions, telling Fox Business 'It's an award I'm very, very proud to win.'

Rocket Lab's largest contract to date: designing and manufacturing 18 satellites for the Tracking Layer Tranche 3 program with advanced missile warning, tracking, and defense sensors to detect hypersonic threats. Company positioning as 'disruptive defense prime contractor.'

In August 2025, Palantir signed a contract with the U.S. Army worth up to $10 billion over the next decade to provide software and data capabilities to meet growing warfare demands. This cemented Palantir's position as one of the largest defense technology contractors in the United States, building on its earlier Project Maven AI military targeting contract and extensive history of military intelligence work dating back to Afghanistan.

In July 2025, xAI received a $200 million contract from the Department of Defense for AI in the military, alongside Anthropic, Google, and OpenAI. This raised conflict of interest concerns given Elon Musk's role as co-leader of the Department of Government Efficiency (DOGE), which gives him influence over agencies that regulate and award contracts to his corporations.

White Stork, secretly established in 2023 by Eric Schmidt through shell companies (Merops, Aurelian Industries, Swift Beat, Volya Robotics), deployed over 80,000 AI-enhanced weapons in Ukraine by January 2026 - including 50,000+ Underdog modules via NORDA Dynamics and 30,000+ X-Drone systems. The company's $400 kamikaze drones claim a 70%+ direct-hit rate via autonomous terminal guidance ('pixel lock' AI). In July 2025, Zelenskyy witnessed the signing of a strategic partnership memorandum between Ukraine's Defence Minister and Swift Beat CEO Eric Schmidt for 'hundreds of thousands of drones.'

Spotify founder Daniel Ek, through his firm Prima Materia, led a €600M funding round for Helsing (European defense AI company making autonomous combat drones), valuing it at $12B. Ek serves as Helsing chairman. Multiple artists including Massive Attack, King Gizzard, and Deerhoof pulled music from Spotify, calling it a 'moral and ethical burden' that fan money funds 'lethal, dystopian technologies.' Ek stepped down as Spotify CEO effective January 1, 2026, transitioning to executive chairman. Spotify stock fell 23% following the announcement.

In June 2025, Founders Fund led Anduril Industries' $2.5 billion Series G funding round at a $30.5 billion valuation. The $1 billion invested by Founders Fund was the largest single investment in the fund's history. Anduril manufactures autonomous weapons systems including the Altius-700M (tested with live warheads), unmanned aerial systems, and counter-UAS technology. The company is building Arsenal-1, a hyperscale manufacturing facility for autonomous weapons near Columbus, Ohio. Founder Palmer Luckey has embraced Trump's defense policies, stating it's 'good to scare people sometimes.' Founders Fund partner Trae Stephens co-founded Anduril and was considered for Deputy Secretary of Defense.

Daniel Ek's venture capital firm led a €600 million funding round in Helsing, a German-French defense tech company developing AI-powered military technology including combat drones used in Ukraine. Ek became Helsing's chairman. The investment sparked artist boycotts with bands like King Gizzard, Massive Attack, and Godspeed You! Black Emperor removing music from Spotify, saying 'We don't want our music killing people.'

In a May 2025 60 Minutes interview, Palmer Luckey publicly defended autonomous weapons that operate using AI without human control, arguing 'it is too morally fraught an area, it is too critical of an area to not apply the best technology available.' He directly opposed UN Secretary-General Guterres' call for a treaty banning autonomous lethal weapons by 2026, dismissing the concern. He also stated 'There's no moral high ground to making a land mine that can't tell the difference between a school bus full of children and Russian armor.' Anduril's systems include weapons that can identify, select, and engage targets autonomously.

Microsoft terminated multiple employees who protested the company's AI technology use by the Israeli military. In April 2025, software engineers Ibtihal Aboussad and Vaniya Agrawal were fired after disrupting Microsoft's 50th anniversary event, where one called AI CEO Mustafa Suleyman a 'war profiteer.' In August 2025, four more employees (Anna Hattle, Riki Fameli, Nisreen Jaradat, Julius Shan) were fired for on-premises protests. Allegations claim Israel's Unit 8200 uses Microsoft Azure to store and analyze Palestinian phone calls for surveillance.

In early 2025, Anduril Industries took over the US Army's Integrated Visual Augmentation System (IVAS) program from Microsoft, a contract worth up to $22 billion to deliver approximately 120,000 augmented reality headsets to soldiers. The Army approved a legal action in April 2025 that effectively transferred Microsoft's contract to Anduril. This represents one of the largest military technology contracts in history and a major expansion of Anduril's defense portfolio into wearable military technology.

Approximately 300 DeepMind employees in London sought to join the Communication Workers Union, citing concerns their AI technology is being used in Gaza conflict via Project Nimbus ($1.2B cloud contract with Israel). At least 5 employees resigned over military involvement and reversal of ethical commitments on AI for defense.

Demis Hassabis co-authored the February 2025 blog post justifying removal of Google's 2018 pledge not to use AI for weapons or surveillance. The post framed military AI as necessary for 'democracies to lead' in AI development. This contradicted DeepMind's founding promise that its technology would never be used for military purposes.

Google removed its commitment to abstain from using AI for weapons and surveillance from its updated AI Principles. The prior version stated the company would not pursue 'weapons or other technologies whose principal purpose or implementation is to cause or directly facilitate injury to people' and 'technologies that gather or use information for surveillance violating internationally accepted norms.' Amnesty International called it 'a shame that Google has chosen to set this dangerous precedent.'

Palantir secured $970.5 million in federal contracts in early 2025, including major deals with defense and intelligence agencies. The company's stock soared as investors anticipated increased government spending on its data analytics platforms under the Trump administration.