The U.S. Army Signs 10-Year, $20 Billion Contract with Anduril

The U.S. Army announced late on Friday that it has officially entered into a 10-year contract with defense technology startup Anduril. The contract has the potential to reach a value of up to $20 billion.

This significant agreement commences with a five-year “base period,” with the flexibility to extend for an additional five years. It encompasses a wide range of Anduril’s offerings, including hardware, software, infrastructure, and various services.

The Army characterizes this deal as a unified enterprise contract that consolidates over 120 individual procurement actions for Anduril’s commercial solutions.

Gabe Chiulli, the chief technology officer at the Department of Defense’s Office of the Chief Information Officer, emphasized the importance of software in the modern battlefield. He stated, “To maintain our advantage, we must be able to acquire and deploy software capabilities with speed and efficiency.”

Anduril, co-founded by Palmer Luckey, gained prominence for selling VR startup Oculus to Facebook (now Meta). Despite controversy surrounding his political contributions, Luckey and Anduril have garnered support from the second Trump administration for their innovative approach to transforming the U.S. military through autonomous technologies.

The company, named after a magical object in “The Lord of the Rings” like Palantir, reportedly generated around $2 billion in revenue last year. Recent reports indicate that Anduril is in discussions to raise a new funding round at a valuation of $60 billion.

Furthermore, this announcement coincides with the Department of Defense’s ongoing dispute with Anthropic, an AI company that is suing the DoD over its classification as a supply chain threat. Additionally, OpenAI has faced backlash and executive departures following a Pentagon contract deal.