Hegseth Designates Anthropic As Supply Chain Risk

Topline

Defense Secretary Pete Hegseth said Friday he will designate artificial intelligence firm Anthropic as a supply chain risk to national security, handing down the designation after President Donald Trump ordered all federal agencies to stop using technology from the company, which said it declined to give the Pentagon unrestricted access to its AI models Thursday.

Trump accused Anthropic of strong-arming the government.

Photo by Celal Gunes/Anadolu via Getty Images

Key Facts

Hegseth said in a tweet the Department of Defense “must have full, unrestricted access to Anthropic’s models,” adding, “no contractor, supplier, or partner that does business with the United States military may conduct any commercial activity with Anthropic.”

Trump said in a Truth Social post, the U.S. will “NEVER ALLOW A RADICAL LEFT, WOKE COMPANY TO DICTATE HOW OUR GREAT MILITARY FIGHTS AND WINS WARS,” accusing Anthropic of strong-arming the Department of Defense.

Anthropic said it turned down a request from the Pentagon asking for unrestricted access to its AI models, saying in a Thursday statement it would “work to enable a smooth transition to another provider” if the Department of Defense moves on from it.

The AI firm took issue with the department’s alleged request to use its technology for mass surveillance and fully autonomous weapons, saying, “we cannot in good conscience accede to their request.”

The AI firm took issue with the department’s request to use its technology for mass surveillance and fully autonomous weapons, saying, “we cannot in good conscience accede to their request.”

The Pentagon gave Anthropic a 5:01 p.m. EST deadline to let the military use its AI models or risk losing its government contract, according to CBS News.

Forbes has reached out to Anthropic and the Pentagon for comment.

What Companies May Be Impacted By Anthropic’s Blacklisting?

Data and software company Palantir, which holds billions of dollars in government and military contracts, will have to cut off its relationship with Anthropic if it wants to keep working with the Defense Department. Rooted in an agreement inked in 2024, Palantir uses Anthropic’s Claude model in its own artificial intelligence platform. While it does not have a formal partnership with Anthropic, Lockheed Martin confirmed this week it was asked by the Department of Defense to assess its “exposure and reliance” on Anthropic. Amazon Web Services may also feel the heat from the supply chain risk designation, as Anthropic AI models are heavily trained using Amazon’s Trainium and Inferentia chips.

Surprising Fact

The Pentagon has denied it intends to use Anthropic’s technology for mass surveillance or autonomous weapons and said the company is “lying,” while asserting contractors cannot decide how their technology is used and must allow the government to use their technology “for all lawful purposes.”

Crucial Quote

“We don’t need it, we don’t want it, and will not do business with them again!” Trump posted Friday.

Big Number

$200 million. That is how much Anthropic’s contract with the Department of Defense is worth. The contract was awarded last summer and involved Anthropic developing “prototype frontier AI capabilities that advance U.S. national security,” according to a statement.

Tangent

Fellow AI and technology companies have come out in support of Anthropic, with 266 Google and 65 OpenAI staffers signing a petition that backs the company for “sticking to their red lines to not allow their models to be used for domestic mass surveillance and autonomously killing people without human oversight.” The staffers said the Pentagon is negotiating with Google and OpenAI “to try to get them to agree to what Anthropic has refused.”

Key Background

Anthropic added in its statement the Department of Defense has threatened to designate the company as a “supply chain risk,” an unprecedented designation for an American company. Anthropic also said the government has threatened to invoke the Defense Production Act to force the removal of safeguards around mass surveillance and fully autonomous weapons. Anthropic is one of many AI companies with government contracts worth hundreds of millions of dollars, working with the Pentagon alongside companies like OpenAI, xAI, Google and Palantir.