The company's Claude chatbot is one of the few AI systems cleared for use in classified settings. But a standoff between Anthropic and the Trump administration is putting its government work at risk.

As well as designating Anthropic as a supply chain risk, the government could also cancel its contract or invoke a Cold War-era law called the Defense Production Act to give the military more sweeping authority to use its products, even if the company doesn’t approve.

Nvidia CEO Jensen Huang weighed in on a conflict between the Defense Department and its strategic partner on Thursday, saying it's “not the end of the world.”

Earlier this week, Defense Secretary Pete Hegseth gave Anthropic a deadline of 5:01 p.m. ET on Friday to agree to the removal of all safeguards, threatening to boot Claude from U.S. military systems or designate the company as a “supply chain risk,” a label used for adversaries of the U.S. that’s never been applied to an American company before.

Defense Secretary Pete Hegseth is set to hold a high-stakes meeting with Anthropic boss Dario Amodei on Tuesday as they try to navigate rising tensions over military use of the Claude AI chatbot.

The Pentagon may decide to officially designate Anthropic as a "supply chain risk" to push them out of government, sources say.