OpenAI lands $200 million deal with US defense department

OpenAI, the company behind ChatGPT, has secured a $200 million contract with the U.S. Defense Department to develop AI tools for military and government tasks. Announced on June 16, 2025, this one-year deal is the first project under OpenAI’s new “OpenAI for Government” initiative, aimed at bringing advanced AI to public sector work.

The pilot program will explore how AI can assist with tasks like helping service members access healthcare and strengthening defenses against cyberattacks. Most of the work will take place in the Washington, D.C. area and is expected to wrap up by July 2026. OpenAI’s Public Sector LLC will lead the effort, focusing on both administrative and security applications.

This move follows OpenAI’s recent partnership with Anduril Industries to build AI for military use, showing a shift from its earlier stance against working with defense projects. The company has also hired a former Pentagon official to guide its national security efforts and added a former National Security Agency leader to its board, signaling a deeper commitment to government collaborations.

OpenAI’s growth is booming, with 500 million weekly active users and a $10 billion annual revenue rate as of June 2025. The company is also raising $40 billion in a funding round led by SoftBank, valuing it at $300 billion. This contract marks a major step for OpenAI in blending AI innovation with national security goals.