Emil Michael, the top Pentagon official overseeing military artificial intelligence policy, sold holdings in AI search engine Perplexity for between $5m and $25m in June, following earlier profit-taking from Elon Musk’s xAI, according to federal financial records seen by the Guardian.
Pentagon AI Official Sells Perplexity Holdings in June
Federal financial disclosures show that Emil Michael divested his shares in Perplexity, an AI-powered search engine, during the summer. The records list the value of the transaction within a broad dollar range of $5m to $25m, meaning the exact profit remains undisclosed. Reports indicate Perplexity has recently sought a financial valuation of $30bn. The Lever initially reported Michael’s holdings in the search engine in March.
Prior to entering government service, Michael received a personal loan from Perplexity ranging between $250,000 and $500,000 at a 4.57% interest rate, according to 2025 financial disclosures. He also held a seat on a Perplexity advisory board, which he resigned from upon joining the federal government. His ethics agreement included a pledge not to profit from unvested stock, though disclosures do not specify whether vested or unvested shares were sold in the transaction. Perplexity secured a contract with the US government’s General Services Administration in November of last year, though records do not link that contract directly to the Pentagon.
Did you know? Federal financial disclosure rules require officials to report assets and transactions in broad dollar ranges rather than exact figures, making precise profit calculations difficult from public filings alone.
Previous xAI Disclosures and Brex Software Sale
The Perplexity divestment follows disclosures earlier this year regarding Michael’s stake in xAI, Elon Musk’s artificial intelligence company. The Guardian revealed that Michael profited between 400% and 4800% after selling private investments in xAI earlier in the year, reaping profits of up to $24m.
In addition to his AI holdings, Michael sold shares in Brex LLC, a financial software company backed by Peter Thiel, after the firm was acquired by Capitol One in April. According to records, Michael sold his Brex holdings for at least $5m, realizing gains of at least 473%. Filings from March 2025 valued those same holdings at a maximum of $750,000, placing his potential profit between $4.25m and $24m. Brex does not report government contracts.
Ethics Scrutiny and Official Defense Response
Ethics experts have raised questions regarding the timing of the divestments. “He should have sold all interest in the company before he started working,” said Richard Painter, a former lawyer at the White House under George W Bush. Painter noted that while owning the stock may not violate the law, it creates appearance issues that most past administrations avoided by requiring officials to exit stocks prior to taking office.
A Pentagon spokesperson defended Michael, stating that he and other defense officials “are in full compliance with ethics laws and regulations” and that “any claims otherwise are false.” The spokesperson emphasized that the department maintains “a rigorous, multi-layered ethics framework.”
Frequently Asked Questions
Who is Emil Michael?
Emil Michael is the top Pentagon official overseeing military artificial intelligence policy and a former chief business officer at Uber.
What companies were involved in the financial disclosures?
Financial records show Michael sold holdings in Perplexity and Brex LLC, following earlier sales of private investments in Elon Musk’s xAI.
Did Michael violate ethics laws?
A Pentagon spokesperson stated that Michael operates in full compliance with ethics laws and regulations, though ethics experts like Richard Painter have argued that holding the stock into his tenure raised questions regarding appearances.
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