OpenAI, the maker of ChatGPT, has been awarded a $200 million (approximately Ksh.25.9 billion) contract by the U.S. Department of Defense to develop advanced artificial intelligence tools aimed at addressing critical national security challenges, the Pentagon announced on Monday.
In a statement, the Pentagon said, “Under this award, the performer will develop prototype frontier AI capabilities to address critical national security challenges in both warfighting and enterprise domains.” The contract underscores the growing role of AI technologies in military and strategic operations.
The deal marks a significant milestone for OpenAI as it expands its footprint in the defense and government sectors. The company reported last week that its annualized revenue run rate has surged to $10 billion, fueled by soaring demand for AI solutions across industries.
OpenAI is also in the midst of an ambitious fundraising campaign. In March, the company announced plans to raise up to $40 billion in a funding round led by SoftBank Group, potentially valuing the firm at $300 billion. The AI powerhouse also reported 500 million weekly active users as of the end of March, solidifying its status as a global tech leader.
While the White House’s Office of Management and Budget issued new guidance in April to encourage a competitive AI marketplace across federal agencies, it notably exempted national security and defense systems, allowing departments like the Pentagon to pursue AI partnerships with leading firms like OpenAI with fewer restrictions.
The newly awarded defense contract highlights the U.S. government’s strategic shift toward integrating cutting-edge AI into its core operations, with OpenAI emerging as a key player in shaping the future of defense technology.
Written By Rodeny Mbua
