Investing.com -- Dell Technologies Inc (NYSE: DELL) shares rose 3.4% in after-hours trading Wednesday after the company secured a $9.7 billion contract with the Pentagon to manage Microsoft software licenses for the U.S. military.

Dell Federal Systems won the single-award, firm-fixed-price blanket purchase agreement under the Department of War Enterprise Software Initiative, according to a Pentagon announcement. The contract will enable the military to procure Microsoft software licenses, cloud subscriptions, and Software Assurance across classified and unclassified systems.

The second-generation DOW Enterprise Software Agreement will streamline and consolidate software acquisition across the DOW, the Intelligence Community, and the Coast Guard. The agreement covers Microsoft products including Windows Enterprise Operating System and Office Professional Plus, as well as tiered Microsoft 365 licenses and specialized bundles such as the "Disconnected No Cloud Access" license.

The contract also includes limited scope for Microsoft Azure to support the transition of specific workloads to the Joint Warfighting Cloud Capability contract. The Naval Information Warfare Center Pacific is the contracting activity for the agreement.

The contract represents a follow-on to Dell's existing work with the military under the Enterprise Software Initiative, which aims to centralize software procurement across defense agencies.