The Pentagon has awarded a $10bn (£8bn) cloud-computing contract to Microsoft, following a heavily scrutinised bidding process in which Amazon had been seen as the favourite.
The 10-year contract for the Joint Enterprise Defence Infrastructure, or Jedi, is aimed at making the US defence department more technologically agile.
Amazon's bid drew criticism from its rivals and US President Donald Trump.
The company said it was "surprised" by the decision.