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Tech and consulting giant IBM was not immune to the Department of Government Efficiency ’s ( DOGE ) deletion .
IBM had 15 of its federal contracts call off due to DOGE - relate cut during the first quarter of 2025 , according to reporting fromReutersandBloomberg . These cuts amount to $ 100 million in next payments , per Bloomberg . Union contracts represent between 5 % and just under 10 % of IBM ’s consulting practice .
After being pelt with questions during IBM ’s earnings call Wednesday , Arvind Krishna , IBM ’s CEO , clarified that the cancellation were related to cutback at USAID . Both Krishna and James Kavanaugh , IBM ’s CFO , then proceeded to downplay the potential impact of DOGE on the company ’s succeeding business .
“ We ’ve had a handful of contract , either assertion of work , or cancel and on our annualized backlog of over $ 30 billion in total consulting , ” Kavanaugh aver . “ This is like less than $ 100 million of reserve over a length of multiple years . So while no one ’s immune , we are absolutely focussed on monitoring the identity dynamic cognitive operation . We ’re prudently cautious around consulting for the class . ”
IBM ’s refer business concern made up 34 % of the company ’s revenue in Q1 . Krishna added that the caller ’s Union government consulting contracts largely focalize on crucial region .
“ The vast majority is critical oeuvre — we in reality process veterans gain claims , ” Krishna said . “ We help process how the [ General Services Administration ] does procurance . We help oneself go through paysheet systems . I do n’t think of these as optional . Now , are there some areas around the edges which could be viewed as discretional ? Yes . But in our case that is the minority of our business , not the majority . ”
IBM ’s consulting gross was down 2 % overall in Q1 , according to the caller ’s first - quarter results . Revenue from consulting in Q1 was slenderly over $ 5 billion .
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“ The variety across our business positions us well to navigate the current climate , ” Krishna tell . “ Our portfolio and tail phonograph recording of execution reinforce my self-confidence on this next chapter of our growth . I look frontward to sharing our advancement as we move through the rest of the class . ”
