OpenAI announced on Friday a 110 billion US dollars funding round valuing the company at 730 billion US dollars, strengthening its AI development capacity, Bloomberg reported.

Earlier, the Pentagon designated Anthropic a supply-chain risk, giving the company six months to transfer AI services. “America’s warfighters will never be held hostage by the ideological whims of Big Tech,” Defense Secretary Pete Hegseth wrote on X. Former President Donald Trump had also instructed federal agencies to end contracts with Anthropic.

Altman said the Pentagon agreement aligns with OpenAI’s principles prohibiting “domestic mass surveillance and human responsibility for the use of force, including for autonomous weapon systems,” with safeguards built into the deployment. He urged the department to extend similar terms to all AI firms.

Anthropic, which raised 30 billion US dollars this month, reiterated: “No amount of intimidation or punishment from the Department of War will change our position on mass domestic surveillance or fully autonomous weapons.” A source told Bloomberg the Pentagon incorporated some of Anthropic’s proposed safeguards, but the company deemed them insufficient.

OpenAI declined to say if it would replace Anthropic’s work, and the Defense Department did not comment.

Bloomberg notes that Dario Amodei, Anthropic’s CEO, left OpenAI in 2020 over concerns about prioritising speed over safety. OpenAI, originally a nonprofit, became a for-profit last year and in 2024 updated its policy to allow military applications. Its mission now focuses on ensuring artificial general intelligence benefits all humanity.

The rivalry between Altman and Amodei remains visible publicly. At a recent AI summit in New Delhi, they stood beside Prime Minister Narendra Modi but did not hold hands while others did.

Both companies are pursuing IPOs this year. Altman said the Pentagon’s agreement could widen tensions with Anthropic, which has strong backing from Silicon Valley workers urging other tech firms to support its stance.