Latest news with #SoftwareAcquisitionPathway
Yahoo
16-05-2025
- Business
- Yahoo
Amid demand for satellite support, Space Force leans on commercial
The Space Force this week announced a new Joint Antenna Marketplace aimed at helping it leverage commercial capacity and relieve the strain on its Satellite Control Network. Space Systems Command said Monday it awarded contracts to two firms — Auria, formerly Boecore, and Sphinx Defense — to establish the cloud-based marketplace prototype, dubbed JAM, which will connect satellite operations centers with government and commercial antennas. The service said Monday it's using the Pentagon's software acquisition pathway to create the marketplace, a tailored procurement method meant to help programs buy software more quickly. Defense Secretary Pete Hegseth recently mandated that all military software be developed and purchased through the pathway. 'The program is currently in the planning phase of the Software Acquisition Pathway and is accelerating commercial capability delivery via prototype development,' SSC said in a statement. JAM will expand the Space Force's existing globally dispersed Satellite Control Network, or SCN, which provides critical launch support, satellite tracking and control, and emergency assistance for spacecraft. The Defense Department and other federal agencies rely on the network for operations support, and demand for the capability has grown significantly in recent years. For the last decade, utilization rates have surpassed the industry standard, according to a 2023 Government Accountability Office report. Space Force officials have said the current SCN architecture on its own may not meet the military's capacity needs during a conflict. The antennas in line to augment and eventually replace SCN's aging infrastructure through a program called Satellite Communications Augmentation Resource, or SCAR, are expected to increase satellite communications capacity by ten-fold for spacecraft in geosynchronous orbit, the Space Force estimates. The new phased-array antennas are being built by BlueHalo. The systems, dubbed Badger, provide multi-beam, multi-orbit mission operations and are designed to make it easier to track and manage satellites. They can also be easily transported around the world. The Space Force awarded the company $1.4 billion in 2022 to deliver 12 units by the early 2030s. However, under its current schedule, the first units won't deliver until the end of this year – a timeline that the service's acting acquisition executive says is not fast enough. Maj. Gen. Stephen Purdy told lawmakers Thursday that while SCAR is making progress, the program is moving 'too slow for my taste and too slow for the need.' Speaking at a House Armed Services Committee hearing, he said that along with helping the Space Force better leverage commercial systems, JAM provides a 'backup plan' for SCAR that provides the extra support in the near term. JAM builds on experimentation the service has conducted with the Space Development Agency and the Space Rapid Capabilities Office to integrate commercial capabilities through a cloud-based SCN. The marketplace 'is going after full-up commercial,' Purdy said, and will open up significant new capacity.
Yahoo
08-04-2025
- Business
- Yahoo
This Artificial Intelligence (AI) Company Just Got Some Unwelcome News Regarding the Pentagon Budget Cuts (Hint: It's Not Palantir)
When Republican presidential nominee Donald Trump was campaigning, one of his more consistent talking points was a concern over areas of wasteful federal spending. This rhetoric inspired the creation of a new program called the Department of Government Efficiency (DOGE) after Trump's election victory on Nov. 5. For the most part, DOGE has focused on cutting ties with expensive contractors and organizations employed by various government agencies. Back in February, Trump essentially extended the idea of DOGE to the military. Specifically, he ordered Defense Secretary Pete Hegseth to identify cost savings around the defense budget. Shortly after this news became public knowledge, shares of artificial intelligence (AI) analytics software darling Palantir Technologies (NASDAQ: PLTR) took quite a beating. Given the company derives roughly half of its revenue from federal contracts (much of it with the Department of Defense), it's not entirely surprising that investors reacted emotionally to the news of budget cuts at the Pentagon and assumed it was bad news for Palantir. Yet recent reporting suggests that the Department of Defense (DoD) is parting ways with another AI software player. Let's explore some of the Pentagon's recent moves and assess why I'm doubling down on my idea that Palantir has a unique opportunity to benefit from these cost reductions. On March 20, Hegseth published a memo in which he outlined the termination of $580 million worth of contracts that were deemed wasteful. Among these deals was a contract to build a human resources software platform. According to the DoD's memo, this contract "is currently 6 years behind schedule and more than $280 million (780%) over budget -- with at least 2 more years of development and testing estimated before initial operating capability." According to contract records, the HR platform was being managed by Oracle. While a move like this is a blow for Oracle, I'll break down why I see it as a potential tailwind for Palantir. Hegseth and the Pentagon's leadership are taking a calculated, intentional approach to these cost reductions -- implementing a strategy known as the Software Acquisition Pathway (SWP). In other words, the DoD isn't simply identifying contracts attached to high dollar values and canceling them blindly. Rather, in partnership with DOGE, the Pentagon is looking closely at its vendor relationships and digging into major contracts that are running over budget and abnormally behind schedule. As the chart above shows, shares of Palantir haven't recovered since peaking back in late February -- around the time the Pentagon's budget reductions started to become public. Nevertheless, the dynamics around the Pentagon's SWP approach could work in Palantir's favor. With the cancellation of the Oracle HR deal (and presumably more reductions with other software providers to follow), Palantir has an opportunity to persuade DoD leadership to consider using its software ecosystem for other applications and use cases beyond the battlefield and stealth operations. I see the budget cuts at the Pentagon as an under-the-radar tailwind for Palantir during the next four years, and one that the company is uniquely positioned to take advantage of given its existing footprint with the military in particular. Although a growth stock such as Palantir is likely to remain volatile in the short term, I think now is an interesting opportunity for long-term investors to consider buying some shares because I see the current negative investor sentiment around the company as overblown and misaligned. Ever feel like you missed the boat in buying the most successful stocks? Then you'll want to hear this. On rare occasions, our expert team of analysts issues a 'Double Down' stock recommendation for companies that they think are about to pop. If you're worried you've already missed your chance to invest, now is the best time to buy before it's too late. And the numbers speak for themselves: Nvidia: if you invested $1,000 when we doubled down in 2009, you'd have $244,570!* Apple: if you invested $1,000 when we doubled down in 2008, you'd have $35,715!* Netflix: if you invested $1,000 when we doubled down in 2004, you'd have $461,558!* Right now, we're issuing 'Double Down' alerts for three incredible companies, available when you join , and there may not be another chance like this anytime soon.*Stock Advisor returns as of April 5, 2025 Adam Spatacco has positions in Palantir Technologies. The Motley Fool has positions in and recommends Oracle and Palantir Technologies. The Motley Fool has a disclosure policy. This Artificial Intelligence (AI) Company Just Got Some Unwelcome News Regarding the Pentagon Budget Cuts (Hint: It's Not Palantir) was originally published by The Motley Fool Sign in to access your portfolio
Yahoo
04-04-2025
- Business
- Yahoo
Despite Its Recent Addition to the S&P 100, This Artificial Intelligence (AI) Growth Stock Is Trading 28% Below All-Time Highs. Time to Buy the Dip?
Last year, shares of artificial intelligence (AI) software company Palantir Technologies (NASDAQ: PLTR) went parabolic -- soaring by 340%, which made the company the top-performing stock in the S&P 500. In addition to this feat, Palantir was added to the Nasdaq-100 toward the end of 2024. Up until mid-February, Palantir stock appeared to be carrying its momentum from last year into 2025. At one point, shares were up by 65% -- trading for around $125 per share. But over the last month, the stock has entered a downward spiral. As of this writing (March 27), Palantir stock is trading 28% below its prior all-time highs. The ongoing sell-off comes at a time when Palantir just earned inclusion into another exclusive club, the . Let's dig into what is driving investors to flee Palantir stock right now. More importantly, I'll explore Palantir's valuation trends to help assess if now is a good opportunity to scoop up some shares. In my eyes, Palantir stock is selling off for two major reasons. First, investors have become wary of how President Donald Trump's new tariffs could impact economic activity. As a result, growth stocks -- particularly in the technology sector -- have been vulnerable to pronounced sell-offs over the last month. As of market close on March 27, the Nasdaq Composite has returned negative 8% on the year. When it comes to business-specific issues, there have been some concerns over whether or not Palantir will be impacted given a new cost reduction initiative at the Pentagon. Palantir works closely with the Department of Defense, and roughly half the company's revenue is concentrated in public sector deal flow. However, as I previously wrote in another piece, Defense Secretary Peter Hegseth's focus on a Software Acquisition Pathway (SWP) strategy at the Pentagon could bode well for Palantir in the long run. In other words, I don't see the budget cuts at the Pentagon as a headwind for Palantir. Before honing in on the current price action around Palantir, let's zoom out and look at the bigger picture. Over the last 12 months, Palantir stock is up by 262%. Over the last six months, shares are up by 143%. Even on a year-to-date basis, Palantir stock boasts a gain of 19%. My point here is that even though shares of Palantir have dropped considerably from all-time highs, the stock is still enjoying a fair bit of momentum. These dynamics become even more clear when benchmarking Palantir against its peers in the software arena. As the chart above illustrates, Palantir is the most expensive name in this cohort of growth software stocks by a mile. Even with heavy selling, the company's price-to-sales (P/S) ratio has expanded considerably over the last year. While the stock is pricey compared to peers, I do see now as an interesting opportunity to buy shares of Palantir on a rare dip. While Palantir's price action could very well continue to exhibit some volatility in the short run, I think the long-term narrative remains strong. The company has a number of strategic alliances that could bode well for long-term growth. Moreover, secular tailwinds fueling rising demand for AI enterprise software platforms represents another compelling catalyst for Palantir. I think the most prudent strategy is to use dollar-cost averaging over a long period of time (i.e., years or decades) when it comes to Palantir stock. Before you buy stock in Palantir Technologies, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Palantir Technologies wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $675,119!* Now, it's worth noting Stock Advisor's total average return is 817% — a market-crushing outperformance compared to 163% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of April 1, 2025 Adam Spatacco has positions in Palantir Technologies. The Motley Fool has positions in and recommends Datadog, MongoDB, Palantir Technologies, ServiceNow, and Snowflake. The Motley Fool has a disclosure policy. Despite Its Recent Addition to the S&P 100, This Artificial Intelligence (AI) Growth Stock Is Trading 28% Below All-Time Highs. Time to Buy the Dip? was originally published by The Motley Fool Sign in to access your portfolio
Yahoo
26-03-2025
- Business
- Yahoo
In the wake of Hegseth's software memo, experts eye further change
In the two weeks since Defense Secretary Pete Hegseth issued a directive requiring the use of rapid procurement methods and contracting tools for all software acquisition, military officials and industry executives have expressed a mix of optimism and angst about the mandate, while also calling for more sweeping reforms to how the Pentagon develops, tests and funds software-heavy programs. The March 6 memo directs all Defense Department components to use DOD's Software Acquisition Pathway, along with other authorities designed to speed up the buying process and better leverage commercial providers. The tools singled out in Hegseth's order have existed for years, but a relatively small number of programs actually use them. 'The Department of Defense has been slow to recognize that software-defined warfare is not a future construct, but the reality we find ourselves operating in today,' Hegseth said in the memo. 'When it comes to software acquisition, we are overdue in pivoting to a performance-based outcome and, as such, it is the warfighter who pays the price.' Officials have attributed the Pentagon's slow adoption of these processes to several causes but have primarily pointed to cultural inertia and risk aversion, both from DOD leaders and within military program offices. In interviews with Defense News and at events around the Washington, D.C., region in recent weeks, industry and Pentagon leaders said they were hopeful that Hegseth's mandate could lead to change — if it's enforced. They also said they view the acquisition guidance as a first step toward broader reforms to how software is funded, tested and priced, as well as how acquisition officers and program managers are trained to manage software-heavy development efforts. Steve Morani, the Pentagon's acting acquisition executive, said Hegseth's order sends a clear mandate for rapid transformation. 'That's Secretary Hegseth's way of, just six weeks into his tenure, introducing some change,' Morani said last week at the annual McAleese Defense Programs Conference. 'It's a sign that he's determined to drive the system to operate differently. I think we're all on notice that, again, we're not going to do things business as usual.' In the immediate aftermath of Hegseth's mandate, Morani said his phone was 'blowing up,' as many in the defense acquisition world were concerned about how this new way of buying software could impact their programs. 'I think there was a lot angst up front,' Morani said. That angst is indicative of the culture change that will be required to implement Hegseth's direction, as well as the sense that there are more changes still to come, he added. 'This is not the exception,' Morani said of the software memo. 'This is going to be the standard way of doing things.' The Software Acquisition Pathway, created in 2020, has been regarded by the department as the recommended approach for buying software. The pathway offers a tailored acquisition mechanism, recognizing that software can't, and shouldn't, be procured under the same process as an aircraft or ship. Today, around 82 programs representing each of the military services are using the pathway to buy a range of capabilities — from command-and-control systems to cyber. The problem, according to one official who recently spoke to reporters on the condition of anonymity, is that the pathway hasn't been combined with other authorities designed to attract and take advantage of commercial capabilities. Those authorities include an approach championed by the Defense Innovation Unit called a Commercial Solutions Opening, a type of solicitation that allows startups and non-traditional defense companies to sell products and services to DOD without navigating arduous requirements documents. DIU also leverages a contracting tool called Other Transaction awards, which isn't subject to the same regulations as a standard contract. When combined, these authorities allow DOD to award software contracts much faster than in the past. Hegseth mandates streamlined software acquisition approach in new memo Justin Fanelli, the Navy's chief technology officer, said this shift may be jarring for some acquisition officers who are used to dealing with a rigorous source selection process that can include thousands of pages of meticulous requirements. For example, the need statement for a Commercial Solutions Opening, or CSO, can sometimes be as succinct as a paragraph. 'As you can image, not everyone's comfortable with that, even inside the building,' Fanelli said March 19 during an Emerging Technology Demo Day in Reston, Virginia. 'We're saying, 'Here are three sentences that are user-sponsored,' and those serve as what we used to know as 3,000 pages of requirements.' Speaking with Defense News after his presentation, Fanelli said the Navy is working to break down some of those barriers by offering examples of programs that have successfully used these tools and reaped the benefits. 'We are, right now, just using this opportunity to stockpile big success stories so that we can get more adoption and change our focus from risk avoidance when it comes to procurement to a focus on impact and outcomes and value-per-dollar,' he said. Kori McNabb, a senior procurement analyst for the Air Force, told Defense News at the same event that while the shift to commercial-like buying is uncomfortable for some of the acquisition officials she works with, she's noticed there's been a greater sense of urgency to learn how to use these tools since Hegseth issued his directive. McNabb highlighted the Air Force's CSO Center of Excellence, which offers training opportunities for program officers who may have less experience with the source selection tool. In recent weeks, use of the center's app has increased from around 200 users at a given time to close to 3,000, she said, adding that her team has upped its training webinar offerings since the memo's release. 'We just slowly grab them and pull them along with us,' she said. 'We're like, 'You have to come along because we're all moving to this.'' A new report from the Atlantic Council's Software-Defined Warfare Commission identified workforce expertise — and the training required to achieve it — as a top need for DOD as it looks to better leverage software. The report, released Wednesday, proposes DOD develop an 'extensive, connected, layered and modular software-centric training program' that both raises awareness about the importance of software and establishes a foundational understanding of commercial best practices. 'While the DoD has taken steps to upskill its existing workforce for the digital age, a widely acknowledged software proficiency shortfall remains,' the commission found. 'While the United States is the world leader in software talent and solutions, the DoD lacks the expertise to effectively acquire, integrate, and use software tools that are central to mission success.' As acquisition officials prepare their workforces to implement the secretary's software guidance, others in the defense community are looking ahead to further reforms — hoping that Hegseth's initial memo is just the beginning of more sweeping changes. Jason Brown, general manager of defense programs at software firm Applied Intuition, said he's hopeful DOD is serious about enforcing the software directive, calling it a 'long overdue' policy. But more reform is needed, he told Defense News in an interview. Brown pointed to software pricing, workforce expertise and testing processes as areas that need further attention if the department wants to make progress in this area. 'Test and evaluation needs to be completely reworked,' he said. 'It's not feasible for the current, very bureaucratic, slow, cumbersome test and evaluation methodologies to also be applied to software. I think everybody recognizes that — even the test and evaluation community — the question is, what are they going to do about it and how do we get there?' The Atlantic Council's report offered a similar assessment of the software testing enterprise, pointing to lagging simulation capabilities and digital infrastructure. Pentagon's commercial tech arm to ramp up role in military innovation Authored by a group of former U.S. military officials and defense experts, the report recommends the Pentagon empower and provide funding to the Test Resource Management Center to improve its digital testing capabilities. Speaking with reporters Wednesday at a Defense Writers Group event in Washington, D.C., former acting Deputy Defense Secretary Christine Fox identified testing infrastructure as a key, near-term focus area for the department. 'The thing that the department has to grapple with is, in addition to buying the software, they need to provide the infrastructure to, particularly, the operating forces,' she said. Along with those investments, the report suggests the department explore letting more mature software vendors self-certify some capabilities as a way to speed up software fielding and reduce bottlenecks in the testing enterprise. The commission also recommends the Defense Department take a commercial-first approach to development and procurement, arguing that DOD too often chooses to develop software on its own when private-sector solutions already exist. 'When the DoD decides to develop custom software, this often results in higher costs, longer schedules, and increased risks,' the report states. 'Commercial software is often updated continuously across a broad customer base, of which the DoD could take advantage. Instead, updating software to address threats and bugs or add functionality takes considerable time and funding.'
Yahoo
07-03-2025
- Business
- Yahoo
Pentagon software buying process shifts towards more access
By Mike Stone WASHINGTON (Reuters) - The U.S. Department of Defense is shifting how it buys software eyeing greater access to commercial and non-traditional software providers as the Pentagon hopes to rapidly modernize its weapons and business systems. In a memo dated March 6, Secretary of Defense Pete Hegseth directed the Department of Defense (DoD) to prioritize a new software acquisition effort he hopes will enhance the lethality of the U.S. military. The memo will be a part of a series of Pentagon directives that attempt to change how the Pentagon acquires weapons and support systems. See for yourself — The Yodel is the go-to source for daily news, entertainment and feel-good stories. By signing up, you agree to our Terms and Privacy Policy. "It effectively is streamlining the access of those nontraditional commercials so that they can play in the game, that the defense primes are also playing in," a Defense officials told reporters on a call about the memo. Defense prime contractors include Lockheed Martin and General Dynamics. Newer and smaller companies like Second Front Systems have made progress but struggled to gain access to Pentagon projects. The memo emphasizes the need for the DoD to adapt to the reality of software-defined warfare and to overhaul its acquisition processes to keep pace with commercial technology advancements. Hegseth stated that the current hardware-centric approach to acquisition has hindered the DoD's ability to rapidly acquire, deliver, and iterate on weapons and business systems software. To address this, he has mandated the adoption of the Software Acquisition Pathway (SWP) as the preferred route for all software development components within the DoD. "Driving a focus on commercial capabilities and faster acquisitions is vital for the Department," Tyler Sweatt, CEO of Second Front Systems, a Pentagon software provider, told Reuters. "Moving away from building custom software using cost plus style contracts and towards procuring solutions puts better capabilities in the hands of our warfighters." The directive also instructs DoD to pursue contracting strategies that maximize the use of commercial solutions as the default approaches for acquiring capabilities. This applies to any software pathway program currently in the planning phase. The Under Secretary of Defense for Acquisition and Sustainment, in coordination with the Director of the Defense Innovation Unit, has been tasked with developing an implementation plan within 30 days to ensure the swift adoption of these changes.
