DHS awards $44M option year 5 for computer systems design services to Anduril Industries, Inc

Contract Overview

Contract Amount: $44,002,098 ($44.0M)

Contractor: Anduril Industries, Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2025-09-05

End Date: 2026-07-31

Contract Duration: 329 days

Daily Burn Rate: $133.7K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: O&S FOR OPTION YEAR 5

Place of Performance

Location: COSTA MESA, ORANGE County, CALIFORNIA, 92626

State: California Government Spending

Plain-Language Summary

Department of Homeland Security obligated $44.0 million to ANDURIL INDUSTRIES, INC. for work described as: O&S FOR OPTION YEAR 5 Key points: 1. Contract value represents a significant investment in ongoing computer systems design services. 2. The contract was awarded under full and open competition after exclusion of sources, suggesting a competitive process with specific justifications. 3. The fixed-price contract type aims to control costs and provide predictability. 4. The duration of this option year is substantial, indicating a long-term need for these services. 5. The contractor, Anduril Industries, Inc., is a key player in the defense and security technology sector. 6. The services are critical for U.S. Customs and Border Protection operations.

Value Assessment

Rating: good

The contract value of approximately $44 million for one option year appears reasonable given the scope of computer systems design services for a major federal agency like DHS. Benchmarking against similar large-scale IT service contracts would provide a more precise value-for-money assessment. The firm fixed-price structure suggests an effort to manage costs effectively. Without specific details on the deliverables and performance metrics, a definitive value assessment is challenging, but the scale implies a substantial and complex service requirement.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This indicates that while the initial solicitation was open, specific sources were later excluded, or a justification was made to limit the pool of eligible bidders. The exact number of bidders considered after exclusions is not specified, making it difficult to fully assess the breadth of competition. This procurement approach may limit price discovery compared to a truly open competition but could be justified by specific technical requirements or existing system integration needs.

Taxpayer Impact: The limited competition may result in less downward pressure on pricing compared to a fully open bid process, potentially leading to higher costs for taxpayers. However, if the exclusion of sources was based on essential qualifications, it could ensure the best-suited contractor is selected, potentially leading to better long-term value.

Public Impact

The primary beneficiaries are U.S. Customs and Border Protection (CBP) personnel who will utilize the enhanced computer systems. The services delivered are crucial for maintaining and improving the technological infrastructure supporting border security and immigration enforcement. The geographic impact is national, as CBP operates across all U.S. borders and within the country. The contract supports a workforce of IT professionals and systems designers, likely within the contractor's organization and potentially involving government personnel for oversight and integration.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if systems are highly proprietary.
Reliance on a single contractor for critical IT infrastructure could pose risks if performance falters.
The 'exclusion of sources' clause warrants scrutiny to ensure it was fully justified and did not unduly restrict competition.

Positive Signals

Award to a single, established contractor can ensure continuity of service and expertise.
Firm fixed-price contract provides cost certainty for the government.
The option year structure suggests successful past performance and a recognized need for continued services.

Sector Analysis

This contract falls within the Computer Systems Design Services sector, a vital component of the broader Information Technology (IT) industry. This sector is characterized by high demand for specialized expertise in software development, system integration, and IT consulting. The market size is substantial, driven by continuous digital transformation across government and commercial entities. This specific contract likely supports critical national security and law enforcement functions, a common area for significant IT spending within the federal government.

Small Business Impact

The data indicates that small business participation (sb) is false, and there is no indication of a small business set-aside (ss). This suggests that the contract was not specifically targeted towards small businesses. Consequently, there are likely limited direct subcontracting opportunities for small businesses unless the prime contractor voluntarily includes them in their supply chain. The overall impact on the small business ecosystem for this specific contract appears minimal.

Oversight & Accountability

Oversight for this contract would typically be managed by contracting officers and program managers within U.S. Customs and Border Protection. Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified services. Transparency is facilitated through contract award databases like FPDS. The Inspector General for the Department of Homeland Security would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

Department of Homeland Security IT Modernization Programs
U.S. Customs and Border Protection Border Security Technology Modernization
Federal Civilian IT Services Contracts
Procurement of Computer Systems Design Services

Risk Flags

Limited competition justification requires review.
Potential for vendor lock-in.
Cybersecurity risks associated with critical infrastructure.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $44.0 million to ANDURIL INDUSTRIES, INC.. O&S FOR OPTION YEAR 5

Who is the contractor on this award?

The obligated recipient is ANDURIL INDUSTRIES, INC..

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Customs and Border Protection).

What is the total obligated amount?

The obligated amount is $44.0 million.

What is the period of performance?

Start: 2025-09-05. End: 2026-07-31.

What is Anduril Industries, Inc.'s track record with the Department of Homeland Security and similar government contracts?

Anduril Industries, Inc. has a growing track record with government agencies, particularly in defense and security technology. While specific details on their performance history with DHS for this exact contract type are not provided in the summary data, the award of an option year suggests satisfactory performance on previous periods. Anduril is known for its work in areas like autonomous systems, AI-enabled surveillance, and border security technology. Their broader experience in developing and deploying advanced technological solutions for government clients indicates a capacity to handle complex IT service requirements. A deeper dive into past performance reviews and any documented issues or commendations would provide a more comprehensive understanding of their reliability and effectiveness in fulfilling government obligations.

How does the $44 million cost for this option year compare to similar computer systems design service contracts awarded by federal agencies?

The $44 million cost for one option year of computer systems design services is substantial, reflecting the scale and complexity typically associated with supporting a major federal agency like U.S. Customs and Border Protection. To benchmark this value, one would compare it to other large IT service contracts awarded by agencies such as the Department of Defense, GSA, or other components of DHS. Factors like the specific services rendered (e.g., software development, system integration, cybersecurity, data analytics), the duration of the contract period, and the level of technical expertise required significantly influence pricing. Without detailed service descriptions and performance metrics, a direct comparison is difficult. However, contracts of this magnitude often involve mission-critical systems, justifying higher investment. The firm fixed-price nature aims to provide cost control, but the overall value is best assessed against the outcomes achieved and the criticality of the systems supported.

What are the primary risks associated with this contract, and how are they being mitigated?

Key risks associated with this contract include potential performance issues, cost overruns (though mitigated by fixed-price), cybersecurity vulnerabilities, and over-reliance on a single vendor. Performance risks are inherent in complex IT projects; mitigation often involves robust contract management, clear performance metrics, and regular reviews. Cybersecurity is paramount for DHS; mitigation involves stringent security requirements, regular audits, and compliance with federal standards. The risk of vendor lock-in is also present, which could limit future flexibility or increase costs if the contractor's solutions are proprietary. Mitigation might involve ensuring interoperability standards and planning for potential future transitions. The 'exclusion of sources' aspect also presents a risk if not properly justified, potentially limiting competition and innovation.

What is the expected program effectiveness or impact of these computer systems design services on U.S. Customs and Border Protection's mission?

The computer systems design services are expected to enhance the operational effectiveness of U.S. Customs and Border Protection (CBP) by improving the technology infrastructure that supports its core missions. This could include advancements in data processing, surveillance systems, communication networks, and analytical tools used for border security, trade enforcement, and immigration management. Improved systems can lead to more efficient data analysis, better situational awareness, faster response times, and more accurate decision-making. Ultimately, the program's effectiveness will be measured by its contribution to CBP's ability to secure U.S. borders, facilitate lawful trade and travel, and enforce immigration laws more efficiently and effectively. The specific impact depends heavily on the nature of the design services provided and their successful integration into existing CBP operations.

How has federal spending on computer systems design services, particularly by DHS, trended over the past five years?

Federal spending on computer systems design services, including by the Department of Homeland Security (DHS), has generally trended upwards over the past five years, driven by the increasing digitization of government operations and the need for advanced technological solutions. DHS, in particular, invests heavily in IT to support its vast mission set, including border security, cybersecurity, and emergency management. This upward trend reflects a broader government-wide emphasis on IT modernization, cloud adoption, and data analytics. While specific figures for DHS's computer systems design services spending would require detailed analysis of historical procurement data, it is reasonable to assume it aligns with the overall federal IT spending trajectory. Factors such as evolving threats, technological advancements, and policy initiatives (like promoting secure and efficient IT infrastructure) contribute to sustained or increased investment in this area.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services

Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1375 SUNFLOWER AVE, COSTA MESA, CA, 92626

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $44,002,098

Exercised Options: $44,002,098

Current Obligation: $44,002,098

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 70B02C20D00000019

IDV Type: IDC

Timeline