Anthropic Stock in Spotlight After Trump Orders Federal Agencies to Stop Using Its AI
President Donald Trump has ordered every federal agency to immediately stop using technology from AI developer Anthropic, a move that has put anthropic stock squarely in the headlines as the company resists demands for unfettered military access.
Anthropic Stock and the federal ban
Trump wrote on Truth Social that "We don't need it, we don't want it, and will not do business with them again!" and said Anthropic's tools will be phased out of all government work over the next six months.
How the row unfolded
The directive follows weeks of public and private back-and-forth between Anthropic CEO Dario Amodei and US Defence Secretary Pete Hegseth, with Hegseth saying he has deemed Anthropic a "supply chain risk. " Hegseth posted on X that Anthropic would be "immediately" designated a supply chain risk, which he said would prohibit any business working with the military from "any commercial activity with Anthropic. "
What Anthropic says
Anthropic has pushed back. it "will challenge any supply chain risk designation in court" and that it had yet to hear anything directly from the White House or the military "on the status of our negotiations. " Anthropic said such a designation "would both be legally unsound and set a dangerous precedent for any American company that negotiates with the government. "
The core disagreement: access and use
The dispute centers on the Pentagon's demand that Anthropic agree to allow the US military "any lawful use" of its tools and technology, while Anthropic has resisted giving unfettered access. it had grown concerned about the government potentially using its AI tools, like Claude, in what it described as "mass surveillance" and "fully autonomous weapons. "
Political pressure and administrative labels
Trump and Hegseth both announced their decisions on social media. Trump also berated the company on Truth Social, writing that Anthropic "better get their act together, and be helpful during this phase out period, or I will use the Full Power of the Presidency to make them comply, with major civil and criminal consequences to follow. " The president has also referred to the defence department as the "Department of War. "
Practical effects for contractors and government work
Anthropic said the only customers who will be affected are companies that also contract with the military; those companies "may have to stop using Anthropic for work being done on behalf of the department. " Prior to Trump's pronouncement, Anthropic had said that, if the US Department of Defense chose to stop using the company's tools, it would "work to enable a smooth transition to another provider. "
Past government use and allies
Anthropic has been in use by the US government and military since 2024 and was the first advanced AI company to have its tools deployed in government agencies doing classified work. Prior to Trump's decision on Friday, Anthropic received support in its stance against the government.
Next steps include the formal designation process that Hegseth described on X and the six-month phase-out Trump ordered; Anthropic has said it will pursue legal challenges if a supply chain risk label is applied.
