After years of delays, hardware and software development for the IVAS project will shift to Anduril, with Microsoft continuing to supply cloud infrastructure.

Should Anduril Industries founder Palmer Luckey have his way, the U.S. Army's effort to arm troops with futuristic, mixed-reality headsets will involve a consortium of companies pumping out "glasses that look a lot like the Oakleys you wear every day all the way up to things that look like an Iron Man helmet.

Microsoft plans to quit developing augmented-reality headsets for the US Army and have Oculus founder Palmer Luckey's Anduril Industries take over the gig. The software giant’s AR-for-Army project is called the Integrated Visual Augmentation System (IVAS) and began in 2018 using hardware based on Microsoft's now-discontinued HoloLens headsets.

Through this partnership agreement, and pending Department of Defense approval, Anduril will assume oversight of production, future development of hardware and software, and delivery timelines. This agreement also establishes Microsoft Azure as Anduril’s preferred hyperscale cloud for all workloads related to IVAS and Anduril AI technologies.

Anduril Industries, led by Palmer Luckey, is set to take over Microsoft’s contract for the U.S. Army’s Integrated Visual Augmentation System (IVAS). The deal, first reported by Axios, originally tasked Microsoft with developing augmented reality goggles for military use.

Palmer Luckey-founded defense tech startup Anduril will take over the development and production of Microsoft's mixed-reality headset program for the U.S. Army, the companies said on Tuesday.

Microsoft Azure will remain the "preferred hyperscale cloud" provider for IVAS workloads, as well as other Anduril AI technologies. The two companies partnered last year to incorporate Anduril's Lattice AI into IVAS systems.