Brookings: Federal AI Spending Hits $7.2 Billion — Up 966% From 2024, DoD Controls 98.9% of Potential Awards

Brookings·medium signal

Brookings analysis of 1,743 federal AI contracts shows obligated funds reached $7.2 billion in 2026 (up 966% from $675M in 2024), with potential awards at $91.8 billion (up 1,912%). The Department of Defense dominates overwhelmingly with 98.9% of potential value ($90.7B) across 1,319 contracts. Small-business set-asides cover 34% of contracts, but women-owned firms received just 1 contract (0.05%). Despite the dramatic spending surge, Brookings notes the federal government is 'still in the experimental phase of AI.'