Anthropic Stock Faces Scrutiny After Trump Orders Federal Ban
President Donald Trump has directed every federal agency to immediately stop using technology from Anthropic, a move that has put anthropic stock and the company’s government ties at the center of a high‑profile dispute. The directive capped days of public and private exchanges and included a six‑month phase‑out of Anthropic’s tools from government work.
What Trump ordered agencies to do
Trump said he would direct every federal agency to immediately stop using technology from AI developer Anthropic. He wrote in a social media post on Friday: "We don't need it, we don't want it, and will not do business with them again!" The president also said Anthropic's tools will be phased out of all government work over the next six months.
Supply chain risk designation
Anthropic is mired in a row with the White House after refusing demands that it agree to give the US military unfettered access to its AI tools. That refusal led Defence Secretary Pete Hegseth to say he has deemed Anthropic a "supply chain risk. " The label would make Anthropic the first US company to ever publicly receive such treatment, and it "will challenge any supply chain risk designation in court. "
Anthropic Stock and customer impact
Both Trump and Hegseth announced their decisions on social media, with the defence secretary saying that Anthropic would be "immediately" designated a supply chain risk, prohibiting any business working with the military from "any commercial activity with Anthropic. " As for Anthropic's other customers, the only impact will be on companies that also contract with the military, and that those companies may have to stop using Anthropic for work being done on behalf of the department.
Company's stance and quotes
on Friday evening that it had yet to hear anything directly from the White House or the military "on the status of our negotiations. " Anthropic also warned that being designated a supply chain risk "would both be legally unsound and set a dangerous precedent for any American company that negotiates with the government. " The company added: "No amount of intimidation or punishment from the Department of War will change our position on mass domestic surveillance or fully autonomous weapons. " The Department of War is a secondary name Trump has given to the defence department.
Timeline and legal responses
Trump's directive followed days of back and forth, in public and private, between Anthropic CEO Dario Amodei and Pete Hegseth. Hegseth and the Pentagon have insisted that Anthropic agree to "any lawful use" of its tools and technology. Anthropic has said it grew concerned in recent months about the government potentially using its AI tools, like Claude, in what it described as "mass surveillance" and "fully autonomous weapons. " Prior to the president's pronouncement, Anthropic had said that, if the US Department of Defense chose to stop using the company's tools, the company would "work to enable a smooth transition to another provider. "
Trump also berated the company on his social media platform, 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. " 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.
The dispute and the steps announced by the administration have placed anthropic stock squarely into the debate over how and whether advanced AI tools should be used by the government and military.
