The company's cloud unit, Amazon Web Services, shared a statement on Wednesday that it was "common practice" to stay contract performance as the protest was pending.
Amazon said work on the $10 billion cloud computing project should halt until after a court rules on its protest of the decision to award Microsoft the contract.
While Microsoft was seen as a strong contender, the convention wisdom was that Amazon had it in the bag: It was widely seen as the only cloud with the right mix of technologies and security clearances to meet the requirements of the contract. In a statement at the time the contract was awarded, the Pentagon said that all offers "were treated fairly".
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Background: The Joint Enterprise Defense Infrastructure project will mean big money and a jewel in the crown of whichever cloud company ultimately wins the contract.
"AWS is absolutely committed to supporting the Department of Defense's modernisation efforts and to an expeditious legal process that resolves this matter as quickly as possible".
In its protest, filed in November, AWS alleges that the Department of Defense repeatedly made "prejudicial errors" that were rooted in influence from President Donald Trump. Previously he had been critical of Amazon and its founder Jeff Bezos - who owns the Washington Post. Trump interjected himself into contract process in July when he said to reporters that he "never had something where more people are complaining", according to a story by CNBC.
The project was then briefly placed on hold, until Defense Secretary Mark Esper could "review' the program".
Microsoft CEO Satya Nadella recently said he believes the company's investment in the so-called hybrid cloud - an area in which Amazon is generally considered to be playing catch up with Microsoft - helped it secure the contract.