Accenture reported delays and cancellations of federal contracts due to the Trump administration’s cost-cutting measures, leading to a more than 6% drop in its share price on Thursday. The administration’s Department of Government Efficiency (DOGE), led by Elon Musk, has been aggressively reducing spending and shrinking the federal workforce, impacting consulting firms like Accenture.
The U.S. General Services Administration has directed agencies to review and cancel non-essential contracts, slowing down new procurement actions and negatively affecting Accenture’s sales and revenue. The company’s federal services unit, which made up 8% of its total revenue in 2024, has been hit particularly hard by these measures.
DOGE’s aggressive policies—including rapid workforce reductions and contract cancellations—have sparked criticism, lawsuits, and uncertainty about the long-term impact on government operations. Meanwhile, President Trump is set to sign an executive order to shut down the Department of Education, a move that has already affected IBM, a key vendor for the department, causing its shares to drop 4%.
Accenture’s new bookings, a key indicator of future revenue, fell 3% to $20.9 billion in Q2. Its consulting services segment, which contributes 59% of revenue, posted $8.3 billion, missing analyst expectations of $8.54 billion. However, the company slightly raised its annual revenue growth forecast to 5%-7%, up from 4%-7%.
