War Tech Ignites M&A; Anduril Unveils Thunder, a New Autonomous ‘Attack Rotorcraft’

INVESTMENT

OpenAI, Anthropic boost lobbying as legacy tech, defense spending slips

OpenAI and Anthropic increased their federal lobbying spending to record levels in the second quarter of 2026 as the artificial intelligence industry poured millions into influencing Washington ahead of the midterm elections and ahead of their highly anticipated IPOs.

Together, the two leading AI developers spent $3.17 million during the second quarter, up 23% from the first three months of the year, according to federal lobbying disclosures.

AI

Shield AI Successfully Tests GE Engine for X-BAT

Shield AI and GE Aerospace announced that they’ve “successfully completed integration, actuation, and engine light-off testing of the advanced Axisymmetric Vectoring Exhaust Nozzle (AVEN) for Shield AI’s X-BAT aircraft,” which they call a “critical milestone in the program’s path to vertical flight.”

AI-powered chatbot helps streamline Army recruiting

To help Army recruiters get information fast, enabling them to do their jobs at speed and with more authoritative resources, the Army developed Staff Sgt. Star, an artificial intelligence-powered chatbot.

The tool provides policy and regulatory guidance and answers to recruiting-based questions, allowing recruiters to quickly find answers without having to sift through manuals or rely on a help desk.

New test campaign will put AI pilots in most realistic flight conditions yet, DARPA official says

In pursuit of more capable autonomous software, DARPA has begun allowing artificial intelligence agents to fly modified F-16s under “exactly the same conditions” as human pilots in training, according to the program manager.

The joint DARPA-U.S. Air Force AIR program, short for AI Reinforcements, marked its first autonomous flight earlier this month at Eglin Air Force Base in Florida, according to a July 16 release. During the flight, a test pilot took off in a modified F-16, gave control to the onboard AI software and later retook control to land.

How a former Marine is rewriting the future of battlefield AI

A pilot program in the Pacific is showing how to get advanced tools all the way to the edge.

Naver Cloud joins forces with Korea University to pursue major defense AI projects

Naver Cloud is making an aggressive push into defense artificial intelligence (AI), announcing a partnership with Korea University to jointly pursue defense projects worth about 20 billion won ($13.5 million) and develop AI technologies for the military's next generation of command-and-control systems.

TECHNOLOGY

Lockheed Martin unveils baby Patriot missile to address urgent gap

With demand for Patriot PAC-3 interceptors sharpened by Russian and Iranian ballistic missile attacks, Lockheed Martin unveiled plans to build a smaller and cheaper, if less capable, version of the exquisite interceptor.

Anduril unveils Thunder, a new autonomous ‘attack rotorcraft’

New VTOL aircraft model shown off at Farnborough Air Show aims to complement, if not replace, the work of attack helicopters

'Electronic warfare is a tech phenomenon': Why the market is rethinking defense valuations

The rapidly evolving nature of warfare and modern military requirements should prompt investors to rethink valuations in the defense sector, according to Panmure Liberum strategist Joachim Klement.

While an increasingly fractious geopolitical environment continues to support the long-term bull case for the defense sector, Klement told CNBC’s “Squawk Box Europe” on Monday, procurement risk, fiscal pressure and the AI trade are starting to separate winners from losers.

POLICY

The Make-or-Buy Line has Moved

The secretary of defense’s November announcement on acquisition reform laid out an unprecedented vision across the entire acquisition spectrum to improve the delivery speed of critical capabilities to our warfighters. One foundational pillar is the implementation of a commercial first policy, which laid out several initiatives: leveraging existing but less often used acquisition authorities, maximizing non-traditional contract vehicles, and increasing the use of more flexible solicitations. Most critically, it drives a commercial solution-first paradigm.

If the immediate commercial solution isn’t sufficient, acquisition officers then find ways to modify it. If that approach does not work, then and only then do they pursue development.

ACQUISITION

M&A War Tech Ignites M&A

Today’s new software-driven, autonomous weapons are revolutionizing how fighting will take place in the future. The rush to build a cost-effective, scalable, asymmetrical arsenal – think drones, robots, uncrewed submarines, unpiloted fighter jets, self-driving tanks, lasers, signal-jamming satellites – is happening with an urgency not seen in generations.

The result has been a surge in defense sector deals stretching back 18 months. The pace shows no signs of slowing.

SPACE

The UK and Space Florida Launch Joint Fund

Officials from Florida and the UK established a £300,000 ($401,000) fund on the sidelines of the Farnborough Air Show yesterday, intended to spur innovative space partnerships on both sides of the pond.

Backed by UKSA’s International Bilateral Fund and Space Florida’s International Aerospace Innovation Fund, the new fund supports projects with at least one partner headquartered in each region.

Better together: The joint call for projects will open this fall, with selections expected in early 2027.

EUROPE

Czech Republic receives first Embraer C-390 Millennium for Air Force

The C-390 Millennium carries 26 tons, flies up to 470 knots, and supports cargo, troop transport, airdrops, medevac, and SAR missions.

Airbus backs European defense tech growth fund to accelerate dual-use innovation

E2D will focus on companies developing technologies in areas such as artificial intelligence, autonomous systems, advanced sensing, cybersecurity, space technologies, and other deep-tech fields supporting future military and commercial applications.

DRONES

Lockheed’s Microwave Drone Hunter Targets 50 Drones in One Flight

The MORFIUS X-Rotor disables multiple drones in flight using reusable high-power microwave technology.

ACC Battle Lab Wants More Counter-Drone Options

The Air Force Point Defense Battle Lab is searching for more defense firms to demonstrate counter-drone capabilities at upcoming exercises designed to test base defenses against unmanned aerial attack.

General Atomics Plans New Drone Design for Reaper Replacement

General Atomics plans to pitch a brand new design for a low-cost, attritable drone to take on missions now carried out by its MQ-9 Reaper.

MARITIME

Babcock Canada wins six-year extension to support Victoria-class fleet

The contract may be further extended to the fleet’s retirement, ensuring continuous support as Canada transitions to new submarines.

Kraken Robotics Secures $35M in New Maritime Defense Tech Orders

Kraken Robotics has announced $35 million in new orders from undisclosed customers for technologies used in the maritime defense, offshore energy, and ocean science sectors.

The contracts cover synthetic aperture sonar, multi-aperture sonar, navigation and positioning systems, and underwater monitoring technologies supplied by Kraken and its subsidiary Covelya.