BOSTON - Zapata Computing Holdings Inc. (NASDAQ: ZPTA), known for its enterprise AI software, has announced a Cooperative Research and Development Agreement (CRADA) with the U.S. Special Operations Command (USSOCOM). The partnership is set to enhance USSOCOM's Hyper-Enabled Operator and Force programs with advanced artificial intelligence (AI) capabilities.
The CRADA focuses on providing USSOCOM with AI tools to improve situational awareness, decision-making, and operational readiness, particularly in environments where connectivity is limited or contested. Zapata AI will utilize its Orquestra® platform to expedite the model development lifecycle (MDLC) and develop AI and machine learning (ML) applications tailored to the specific mission objectives and parameters of USSOCOM.
Christopher Savoie, CEO and co-founder of Zapata AI, expressed pride in supporting USSOCOM's national security efforts, highlighting the company's battle-tested platform and experience in deploying AI solutions in challenging conditions. The AI and decision-support capabilities developed through this collaboration will operate on edge computing systems in low connectivity scenarios, leveraging ruggedized high-performance computing hardware.
The agreement not only aims to accelerate USSOCOM’s operational capabilities but also deepens Zapata AI’s existing relationship with the U.S. Department of Defense. Zapata AI has a history of involvement in defense innovation, including its participation in all tracks of the Defense Advanced Research Projects Agency (DARPA) Quantum (NASDAQ:QMCO) Benchmarking program. In June 2024, the company shared the results from Phase II of this program.
Zapata AI's approach involves deploying an ensemble of small, specialized AI models at the edge, a strategy that has proven effective in providing real-time analytics and decision support. This method has been successfully applied in other high-stakes scenarios, such as with Andretti Global's race intelligence needs.
The Boston-based company, founded in 2017, is recognized for its extensive patent library in enterprise AI and quantum computing and continues to assert its presence across various industries, including defense, manufacturing, automotive, and finance.
This news is based on a press release statement.
In other recent news, Zapata Computing has been a subject of significant developments. Cantor Fitzgerald recently initiated coverage on the enterprise software company with an Overweight rating and a price target of $1.75. The firm highlighted Zapata's advanced mathematical concepts from quantum physics and computing, which provide substantial advantages over traditional computing techniques.
Simultaneously, Benchmark initiated coverage on Zapata's stock with a Speculative Buy rating and a 2025 price target of $1.50, citing the company's innovative approach and ability to compress Large Language Models as key growth drivers.
Zapata is also facing potential delisting from Nasdaq due to its market value falling below the required threshold. Despite this, the company continues to explore options to regain compliance.
Zapata has also presented key research findings to the Defense Advanced Research Projects Agency (DARPA) as part of Phase II of DARPA's Quantum Benchmarking program, emphasizing the company's prominence in the quantum computing industry. Furthermore, Zapata has expanded its partnership with Andretti Global through a $1 million investment, positioning itself as Andretti's official AI Partner.
InvestingPro Insights
Zapata Computing Holdings Inc. (NASDAQ: ZPTA) has recently made headlines with its new partnership with USSOCOM, aiming to bolster defense capabilities with its AI expertise. As investors and industry watchers evaluate Zapata's potential, it's essential to consider a few key financial metrics and insights provided by InvestingPro.
InvestingPro Data reveals that as of the last twelve months leading into Q1 2024, Zapata boasts a market capitalization of $16.4 million. Despite the company's innovative strides, the financial data indicates challenges, with a negative price-to-earnings (P/E) ratio of -0.38, suggesting that the market has concerns about future earnings potential. Additionally, the company's revenue has seen a decline of 1.96%, with a more pronounced quarterly revenue drop of 19.44% in Q1 2024.
However, it's not all grim for Zapata; the company has experienced a significant return over the last week, with a 12.93% price total return. This short-term uplift could reflect market optimism following the announcement of the CRADA with USSOCOM, or potentially other factors not immediately evident from the financials alone.
Two InvestingPro Tips offer further insights into Zapata's financial health. Firstly, Zapata holds more cash than debt on its balance sheet, which is a positive sign of financial stability. Secondly, the company has been quickly burning through cash, which could raise concerns about its long-term sustainability without additional funding or revenue streams.
For those interested in a deeper dive into Zapata's financial outlook, there are 15 additional InvestingPro Tips available, which could help investors make more informed decisions. These tips include analyses on stock volatility, gross profit margins, and profitability projections for the year.
As Zapata Computing Holdings Inc. continues to navigate the competitive landscape of enterprise AI and defense contracting, keeping an eye on these financial metrics and expert insights will be crucial for stakeholders.
For more detailed analysis and tips on Zapata Computing Holdings Inc., interested readers can visit InvestingPro.
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