Technology Pentagon officially informs Anthropic of supply chain risk designation by Julia Shapero and Filip Timotija - 03/05/26 7:26 PM ET by Julia Shapero and Filip Timotija - 03/05/26 7:26 PM ET Share ✕ LinkedIn LinkedIn Email Email NOW PLAYING The Pentagon officially informed Anthropic leadership Thursday that the company and its products are deemed a supply chain risk “effective immediately,” a senior Pentagon official told The Hill. “From the very beginning, this has been about one fundamental principle: the military being able to use technology for all lawful purposes,” the official said. “The military will not allow a vendor to insert itself into the chain of command by restricting the lawful use of a critical capability and put our warfighters at risk.” Defense Secretary Pete Hegseth announced Friday that he would be designating the AI firm as a supply chain risk following a dispute with the company over the terms of service for its AI models. Anthropic noted at that time that it had not yet received any direct communication from the White House or Pentagon. President Trump also directed federal agencies on Friday to stop using the company’s tools. The supply chain risk label, which is typically reserved for foreign adversaries, has wide-reaching impacts for Anthropic, restricting defense contractors’ ability to use its products. Hegseth suggested Friday that no contractor, supplier or partner that does business with the U.S. military can conduct “any commercial activity” with Anthropic as a result of the designation. However, the AI firm, which called the move “unprecedented” and “legally unsound,” argued the Defense secretary does not have the authority to bar anyone who does business with the military from using its tools to serve other customers. The dispute centers on how the Pentagon is permitted to use Anthropic’s AI models. The company sought restrictions on using its technology for mass domestic surveillance and fully autonomous lethal weapons, while the Defense Department pushed for more expansive “all lawful purposes” language. Just hours after Hegseth announced the supply chain risk designation last week, OpenAI said it had reached an agreement with the Pentagon to allow its AI models to be used on the military’s classified network. Anthropic’s Claude was previously the only AI tool available on the classified side. The Defense Department also recently reached an agreement with xAI, which is owned by the Elon Musk-controlled company SpaceX, to bring its models to the military’s classified systems. Notably, the OpenAI agreement included the two restrictions also sought by Anthropic on mass domestic surveillance and autonomous lethal weapons. The ChatGPT maker announced additional protections Monday after facing pushback over the strength of its original terms. Add as preferred source on Google Tags Anthropic Elon Musk Pete Hegseth Copyright 2026 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. Share ✕ LinkedIn LinkedIn Email Email More Technology News See All Technology Anthropic CEO vows to fight risk designation, insists ‘vast majority’ of customers won’t be affected by Julia Shapero 2 hours ago Technology  /  2 hours ago