US backs AI software through SWP boosts Palantir leadership

The US government speeds up AI software spending, reshaping opportunities for Palantir and BigBear.ai.

US backs AI software through SWP boosts Palantir leadership

The United States is shifting more of its AI investment toward software through the Software Acquisition Pathway, a framework designed to deliver secure, fast software. Recent moves include a $795 million extension for Palantir’s Maven Smart System, bringing that program’s total to about $1.28 billion, and a separate Army contract potentially worth up to $10 billion over ten years. The government is also pursuing ImmigrationOS for ICE, signaling a broader push to deploy AI across federal agencies.

This shift from hardware to software could redefine which companies win in the public sector. Palantir benefits from a diversified set of big-ticket, multi-year deals that create revenue visibility and upsell opportunities across defense and civilian agencies. BigBear.ai shows the value of niche applications, winning contracts in national security analytics, force management, and airport security. Yet the growth paths look different: Palantir’s scale comes with expensive valuation metrics, while BigBear.ai relies on smaller, more specialized contracts that may not scale as quickly. Investors should weigh the durability of government demand against the risk that budgets, policy priorities, or political backlash could trim or redirect funding in the years ahead.

Highlights

The next wave will test if government demand translates into sustainable, broad-based growth.