Anduril signs 10-year, $20 billion contract with US Army

The US Army announced late Friday that it has signed a 10-year contract with defense technology company Anduril. The agreement starts with a five-year base period, with the option to extend the deal for an additional five years. The contract, which could be worth up to $20 billion, includes Anduril hardware, software, infrastructure, and services. The Army describes the agreement as a single enterprise contract consolidating what had been more than 120 separate procurement actions—defined as government purchasing processes—for Anduril’s commercial solutions. The consolidation aims to allow the military to acquire and deploy software capabilities with speed and efficiency.

The Department of Defense is framing the consolidated agreement as a necessary shift toward software-defined systems, where functionality is primarily determined by software. Gabe Chiulli, the chief technology officer at the Department of Defense’s Office of the Chief Information Officer, emphasized the strategic necessity of the transition, stating that the modern battlefield is increasingly defined by software and that the military must be able to acquire and deploy software capabilities with speed and efficiency to maintain its advantage. This transition reflects a focus within the military on maintaining its advantage through software.

Anduril, which was co-founded by Palmer Luckey, is in talks to raise a new funding round at a $60 billion valuation. This potential round follows a year in which the firm brought in around $2 billion in revenue. Luckey’s past includes a high-profile exit from Facebook; Facebook fired Luckey after controversy erupted following a news report that he’d donated to a pro-Trump political group.

The contract arrives amid broader friction between the Department of Defense and commercial technology firms. Artificial intelligence company Anthropic is currently suing the Department of Defense over its designation as a supply chain threat following a failed contract negotiation. Meanwhile, OpenAI has faced consumer backlash and at least one executive departure after signing a Pentagon deal of its own. In a post on X, Luckey argued that Anthropic’s attempt to draw red lines around the use of AI in autonomous weapons or domestic mass surveillance is “an untenable position that the United States cannot possibly accept.”

Why it matters

The deal signals a major shift in how the US military procures technology, moving away from fragmented purchasing toward consolidated, software-defined enterprise contracts. By bundling more than 120 separate procurement actions into a single agreement, the US Army is establishing a new template for scaling commercial software and hardware across the armed forces.