AI Daily News: U.S. Department of Defense Awards AI Contracts to Leading Firms

U.S. Department of Defense Awards AI Contracts to Leading Firms

The U.S. Department of Defense has awarded contracts worth up to $200 million each to AI companies including OpenAI, Google's Alphabet, Anthropic, and Elon Musk's xAI. These contracts aim to enhance the DoD's use of advanced AI capabilities and develop agentic AI workflows to address national security challenges. This initiative reflects a broader push by U.S. government agencies to expand AI adoption, supported by a White House order promoting AI and regulatory rollbacks by President Donald Trump. xAI also launched 'Grok for Government,' offering its latest AI models to federal and security sectors. OpenAI previously received a $200 million contract for developing frontier AI for warfighting and enterprise applications. These moves signify a growing integration between top AI firms and U.S. government functions, amid concerns about ensuring fair competition in federal AI contracting, raised notably by Senator Elizabeth Warren.

Nvidia Resumes AI Chip Sales to China After U.S. Approval

Nvidia CEO Jensen Huang announced that the company has received approval from the Trump administration to resume sales of its advanced H20 computer chips to China. These chips are vital for artificial intelligence development, an area in which China hosts half of the world’s researchers. The approval comes after Huang's recent meetings with President Trump and other U.S. policymakers, followed by his visit to Beijing for a supply chain conference. Nvidia had previously been restricted from selling AI chips to China due to U.S. national security concerns, particularly regarding their potential military use. The restrictions were expected to cost Nvidia $5.5 billion. Alongside Nvidia, other tech leaders lobbied for the reversal, arguing that export controls could limit U.S. competitiveness and push global partners toward Chinese technologies. Following the announcement, Nvidia’s shares surged nearly 5%. The development marks a significant shift in U.S. technology export policy under Trump’s second term.

Google Launches 'AI Works for America' Training Program

On July 15, 2025, Google announced the launch of 'AI Works for America,' an initiative aimed at training workers and small businesses in essential artificial intelligence (AI) skills. The program begins with a focus on Pennsylvania under the banner 'AI Works for Pennsylvania,' in alignment with the inaugural Pennsylvania Energy and Innovation Summit organized by Senator Dave McCormick. The goal is to develop an 'AI-empowered U.S. workforce' amid increasing concerns about AI replacing traditional jobs. While Google has historically offered skills training, this program carries greater significance given the rising impact of AI on employment. Google’s investment is intended to enhance energy access and equip Americans with the necessary skills to thrive in an AI-driven economy. However, skepticism remains about whether such training can keep pace with the rapid job disruptions already underway due to AI advancements.

CoreWeave Invests $6 Billion in Pennsylvania AI Data Center

CoreWeave has announced a $6 billion investment to construct a new artificial intelligence (AI) data center in Pennsylvania, aligning with U.S. President Donald Trump's initiative to bolster the nation's dominance in the AI sector. This strategic move reflects broader efforts to localize AI supply chains and address the rising energy and computational needs driven by rapid advancements in AI. The announcement is set to coincide with a CEO roundtable at Senator Dave McCormick's inaugural Pennsylvania Energy and Innovation Summit, where Trump is also expected to unveil $70 billion in AI and energy investments. The Pennsylvania facility will initially consume 100 megawatts (MW) of power, with plans to scale up to 300 MW, and is projected to create approximately 600 construction jobs and 70 full-time roles upon launch. The move follows CoreWeave's recent $9 billion acquisition of crypto mining company Core Scientific to expand its energy and data center capacity. This investment joins Amazon's recent pledge of at least $20 billion to expand its own data centers in the state, underscoring Pennsylvania’s growing significance in AI infrastructure development. CoreWeave’s share price rose over 8% in response to the announcement.

Fujitsu's AI Progress Threatened by UK Post Office Scandal

Fujitsu, a Japanese tech firm, has seen its share price surge by nearly two-thirds amid the global artificial intelligence boom, driven by innovations in enterprise AI, hybrid computing, and energy-efficient data center technologies. However, this progress is threatened by renewed scrutiny over its Horizon IT system, developed for the UK Post Office. Between 1999 and 2015, errors in the system led to the wrongful prosecution of hundreds of sub-postmasters, with some even imprisoned. A recent public inquiry revealed Fujitsu was aware of software defects, intensifying calls in the UK Parliament for accountability and a proposed £300 million interim compensation. This amount represents about 20% of Fujitsu's adjusted operating profit for the past fiscal year, and potential additional legal and compliance costs could deepen the financial hit. With over £3.4 billion in UK public sector contracts since 2019, the risk of exclusion from future government projects—especially with HM Revenue & Customs—could significantly impact revenues. While Fujitsu remains a strong player in the global AI market, the ongoing UK scandal poses serious reputational and financial risks that could shift the positive investor sentiment.