Palantir Technologies Inc. ( PLTR ) shares are trading higher in the premarket session on Friday after ending yesterday’s run with a nearly 4% jump.

Yesterday, after the closing bell,  the company announced that the Department of Defense Chief Digital and Artificial Intelligence Office (CDAO) awarded its subsidiary, Palantir USG, a production contract.

The order pertains to making licenses of their AI-enabled operating system available across the Department of Defense.

“These awards represent a vital step in warfighter adoption of AI, moving cutting-edge technology from experiment to enterprise production,” said Shannon Clark, Head of Defense Growth, Palantir ( PLTR ).

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Initially, a $153 million order was placed to aid specific Combatant Commands and the Joint Staff, with potential additional awards totaling up to $480 million over five years.

Furthermore, the CDAO granted Palantir ( PLTR ) a $33 million prototype Other Transaction to swiftly integrate third-party vendor and government capabilities into the government-owned, Palantir ( PLTR )-operated data environment, addressing key Combatant Command digital requirements.

“We are proud to support the CDAO, enabling commanders to make better, faster decisions across all domains at unprecedented scale,” Clark added.

Palantir’s commercial solutions will play a vital role in the extensive CJADC2 ecosystem, collaborating with other vendors and programs to enhance battlespace awareness, global integration, contested logistics, joint fires, and targeting workflows.

Leveraging data integrations developed through Palantir’s prior deployment of AI/ML tools for the warfighter will further enhance user capabilities.

“In this era of geopolitical competition, the CDAO has become an essential leader in bringing operational CJADC2 capabilities to life through the agile, effective, and responsible deployment of AI/ML,” said Akash Jain, President of Palantir USG.

This collaboration builds on Palantir’s enduring relationship with CDAO, particularly in aiding the Global Information Dominance Experiment (GIDE) events and creating effective real-world applications using advanced technologies.

Price Action: PLTR shares are trading higher by 0.60% to $21.86 premarket at last check Friday.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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