Egypt is among about 14 countries designated at “major non-NATO allies” by US presidents. This status recognizes that they do joint military exercises with the US, and gives them special access to advanced US weaponry. However, some of them are not allies in the precise legal sense. That is, there is no obligation of mutual defense. A true ally, as with NATO states, is one that the allied country is pledged to defend from attack. Still, US officials typically have referred to Egypt as an ally, and the State Department made clear that it continues to do so.
So Obama was technically correct that Egypt is not an ally in the sense that Britain or even Turkey is. But unlike what some media outlets wrote, this statement was no gaffe. Rather, Obama was playing hardball with Morsi, trying to impress upon him that the status of ‘major non-NATO ally’ is not automatic now that the Muslim Brotherhood is in control. It will have to be re-earned, at least from Obama’s point of view. And the lack of response on the embassy attack is not consistent with ally status. Non-NATO ally status is bestowed by a stroke of the presidential pen, so Obama could take it away.
Cole also details how he believes Morsi and his administration have finally caved to US pressure by publicly denouncing the attacks:
Obama has enough assets in his contest with Morsi to influence the Egypt situation– loan reduction, civilian and military aid, and the danger that a US State Department travel warning could devastate Egypt’s tourist industry, which is worth billions a year. Even Obama’s willingness to play a politics of reputation with Morsi’s Egypt seems to have had some effect. [Obama's ally comment] wasn’t a ‘gaffe.’