Accenture CEO says DOGE’s cost-cutting drive is hitting business, as worry spreads among staff

• Consulting firm Accenture said that its business has slowed amid DOGE’s cost-cutting agenda.
• Accenture stock fell 7% on Thursday following the release of earnings.
• An Accenture Federal Services employee told BI, “You can sense the fear” in the department.

Accenture CEO Julie Sweet has warned that DOGE’s cost-cutting efforts have started to impact the consulting firm’s revenues and slowed procurement of new projects with the federal government.

“The new administration has a clear goal to run the Federal government more efficiently. During this process, many new procurement actions have slowed, which is negatively impacting our sales and revenue,” Sweet said in a Q2 earnings call with analysts on Thursday.

Accenture is one of 10 consulting firms whose contracts with the federal government are being assessed amid Elon Musk’s DOGE spending-efficiency drive.

Employees told Business Insider this week that the review is causing uncertainty within Accenture Federal Services (AFS), the firm’s federal arm.

“You can sense the fear,” one told BI.

In February, employees told BI Accenture had announced in a town hall that it would reduce the amount of time employees were allowed between projects, known in the industry as being “on the bench.” Workers who did not have a project lined up when their contract concluded would be let go.

This week, two AFS employees who spoke to BI said that since mid-February they had seen an increase in posts on Teams group chats from colleagues looking for projects.

“Every channel is filled with quite a few of these types of messages,” said one senior AFS employee.

Some were looking to transfer from federal to the commercial side of Accenture — Accenture LLP — one senior employee said. But the person added that there were few opportunities to do so, and instead people on their team were being let go.

Accenture did not immediately respond to a request for comment from BI.

Sweet’s comments on the company’s earnings call came less than a month after the General Services Administration, the US government’s main procurement arm, told federal agencies to justify their contracts with the highest-paid consulting firms contracting with the government and determine which could be cut. The list includes firms like Deloitte, Booz Allen Hamilton, and IBM.

AFS generated 8% of Accenture’s $16.7 billion global revenue in Q2, Sweet said on the call.

Accenture’s global Q2 revenue rose 5% on the previous year, but shares fell by 7% on Thursday amid the uncertain outlook.

“While we continue to believe our work for federal clients is mission critical, we anticipate ongoing uncertainty as the government’s priorities evolve and these assessments unfold,” Sweet said.

According to data available on USAspending.gov, 26 new contracts were awarded to Accenture in the first half of this financial year, compared to 51 for the same period in 2024.

Sweet said that Accenture has been driving efficiency in the federal government for decades and could provide commercial solutions to help support the government’s agenda.

“We see major opportunities over time for us to help consolidate, modernize, and reinvent the federal government to drive a whole new level of efficiency,” she said.

The CEO also highlighted that tariffs and consumer sentiment had led to an “elevated level of what was already significant uncertainty in the global economic and geopolitical environment” compared to the previous quarter.

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