OpenAI Secures $200 Million AI Contract with U.S. Defense Department

WASHINGTON, June 16 (Reuters) – OpenAI, the creator of ChatGPT, has been awarded a $200 million contract by the U.S. Defense Department to supply artificial intelligence tools, according to a statement from the Pentagon on Monday.

Under the terms of the contract, OpenAI will develop prototype AI capabilities intended to tackle pressing national security issues in both military and operational areas. The work will primarily take place in and around Washington, with an expected completion date set for July 2026.

In a related announcement last week, OpenAI reported a strong annualized revenue run rate as of June, indicating it is on track to reach its financial targets amid the increasing adoption of AI technologies. Additionally, OpenAI revealed plans to raise up to $40 billion in a funding round, led by SoftBank Group, valuing the company at approximately $300 billion.

OpenAI’s user base has seen remarkable growth, boasting 500 million weekly active users as of late March. Meanwhile, the White House’s Office of Management and Budget has issued new guidelines aimed at ensuring a competitive AI marketplace that benefits both the government and the public. However, these guidelines have exempted areas related to national security and defense systems.

Reporting by Kanishka Singh in Washington; Editing by Leslie Adler.