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OpenAI Secures $200 Million Contract with U.S. Pentagon for AI Solutions

Defence Technology

Business Honor
18 June, 2025

OpenAI to develop advanced AI tools for national security, boosting defense capabilities.

OpenAI, the parent company of ChatGPT, has awarded a $200 million contract to supply artificial intelligence (AI) solutions to the U.S. Defense Department. The Pentagon made the announcement on Monday, saying OpenAI will assist in building "frontier AI capabilities" to counter national security challenges in warfighting and enterprise domains.

The contract work will be done mostly in and around Washington, D.C., and the completion date is planned for July 2026. The contribution by OpenAI will be directed towards developing AI systems to address vital defense challenges, improving military action and national security policies.

Aside from this new agreement, OpenAI still experiences stunning growth. The firm recently announced that the annualized revenue run rate of its business had jumped to $10 billion as of June, indicating the fast uptake of AI technology. OpenAI is also set to raise as much as $40 billion in a new funding round, led by SoftBank Group, taking its valuation to an estimated $300 billion.

This agreement is another major milestone for OpenAI, after the company increased its presence in the AI world. OpenAI has been at the forefront of creating advanced AI tools, with its ChatGPT language model reaching more than 500 million weekly active users as of the end of March 2025.

The U.S. government is also focusing on AI, with the White House’s Office of Management and Budget releasing new guidance in April to ensure that federal agencies, and the public, benefit from a competitive American AI marketplace. This partnership between OpenAI and the Pentagon highlights the increasing role of AI in both business and national security applications.

While OpenAI further extends its influence, this agreement with the U.S. Defense Department highlights the increasing relevance of AI in strategic areas such as defense and security.