Palantir has landed another lucrative Defense Department commitment: an internal Deputy Secretary of Defense memo directs DOD components to spend up to $243.9 million on the company's software with no competition through March 31, 2027, and hunt for follow-on Palantir work through the end of 2028. The memo, first reported by Washington Technology and Defense One, was signed by Deputy Defense Secretary Steve Feinberg on August 4 and adds to a rapidly growing pipeline of sole-source federal awards to the Denver-based data giant.
A Memo Without Justifications
Feinberg praised Palantir's software for "providing valuable support to improve efficiencies with the defense industrial base," citing its ability to flag delays in munitions and delivery-vehicle production. But the memo lists none of the four standard Federal Acquisition Regulation justifications for a no-compete award — urgency, only one responsible source, critical follow-on work or national security — that agencies must document to award sole-source work. It simply tells the acquisition and comptroller chiefs to work with military leaders to find money for Palantir products.
Riding A No-Compete Wave
Palantir has taken $3.2 billion in federal contract obligations since 2024, with roughly half awarded without competition, per GovTribe data. No-compete contracts hit 14.8% of all awards in the first half of 2026, up from 12.6% the prior year. The new memo follows Palantir's sovereign-AI operating system with NVIDIA, its Hivemind kill-web integration with Shield AI, and a $10 billion 10-year Army enterprise agreement that consolidated its existing contracts last summer.
Cash Machine
Palantir reported Q2 revenue of $1.9 billion, up 93% year over year, with federal contracts accounting for $809 million — a 90% jump. The company now ranks No. 40 on the Washington Technology Top 100, having leapt 22 spots in a year. Critics warn the memo formalises a pattern of steering federal dollars to a favoured contractor without the paper trail sole-source rules require. Federal News Radio reported DOD has issued similar memos involving other companies.
Reporting based on coverage from Defense One, Washington Technology, The Register and Federal News Network.