US DEFENCE Secretary Pete Hegseth is “close” to cutting business ties with Anthropic and designating the AI company a “supply chain risk” — meaning anyone who wants to do business with the US military has to cut ties with the company, US news outlet Axios reported.

It quoted a senior Pentagon official as saying: “It will be an enormous pain in the ass to disentangle, and we are going to make sure they pay a price for forcing our hand like this.”

Anthropic and the Pentagon have held months of contentious negotiations over the terms under which the military can use Claude. As a sign of how embedded the software already is within the military, Claude was used during the Maduro raid in January.

However, the kind of penalty being imposed on the company is usually reserved for foreign adversaries.

Anthropic’s Claude is the only AI model currently available in the military’s classified systems, and is the world leader for many business applications. Pentagon officials heartily praise Claude’s capabilities.

While the AI firm has said it is prepared to loosen its current terms of use, but wants to ensure its tools aren’t used to spy on Americans en masse, or to develop weapons that fire with no human involvement.

Chief Pentagon spokesman Sean Parnell told Axios: “The Department of War’s relationship with Anthropic is being reviewed. Our nation requires that our partners be willing to help our warfighters win in any fight. Ultimately, this is about our troops and the safety of the American people.”

An Anthropic spokesperson said: “We are having productive conversations, in good faith, with [the Department of War] on how to continue that work and get these new and complex issues right.”

Published in Dawn, February 18th, 2026