DOGE Is Now a Risk Factor: How Government Contractors Are Rewriting Their 10-Ks
Twelve months ago, the Department of Government Efficiency did not exist. Today, it has terminated 13,440 federal contracts worth $61 billion and canceled 15,887 grants worth $49 billion. Companies that derive most of their revenue from the U.S. government are now adding DOGE as an explicit, named risk factor in their SEC filings - a disclosure category with zero historical precedent. Here is what those filings reveal about who is actually getting hurt, who is bluffing, and how to tell the difference.
The DOGE Disclosure Shock
→The scale: $110 billion in combined contract terminations and grant cancellations in under 12 months
→The disclosure shift: Government contractors are adding DOGE by name to their 10-K risk factors for the first time
→The split: Civilian-heavy contractors face real revenue risk; defense-heavy firms are more insulated
→The opportunity: One company, Palantir, is positioning itself as a DOGE beneficiary - not a victim
$110 Billion in 12 Months: The DOGE Impact by the Numbers
The Department of Government Efficiency has moved faster than any government restructuring initiative in modern history. What started as an executive order in January 2025 became a $110 billion reordering of federal spending within a year. To put that in perspective: that is roughly the annual revenue of the entire U.S. government contracting industry outside defense.
Contracts Terminated
$61 billion
Across civilian and defense agencies
Grants Canceled
$49 billion
Research, education, healthcare programs
Navy Cuts
$3.7 billion
Leading defense sector efficiencies
Army Cuts
$3.2 billion
Maintenance and modernization programs
Air Force Cuts
$2.3 billion
IT and logistics contracts
Total Defense Efficiencies
$11 billion
Identified across all defense branches
Why This Is Unprecedented in SEC Filings
Government budget risk has appeared in contractor 10-K filings since the 2013 sequestration. But that was a systemic, bipartisan spending cap. DOGE is different: it is a targeted, executive-driven initiative that can terminate specific contracts and grants outside the normal budgeting process.
The result: Companies cannot treat this as standard budget risk anymore. They have to disclose it as a distinct, named threat - the same way companies added COVID-19 as a specific risk factor in 2020.
Timeline: From Executive Order to 10-K Risk Factor
The speed at which DOGE moved from political initiative to SEC disclosure requirement tells its own story. Here is how the impact cascaded through corporate filings:
DOGE Established
January 2025Department of Government Efficiency created via executive order
Filing impact: Too early for 10-K impact; some companies note in 8-K current reports
First Contract Terminations
Q1 2025Initial wave of civilian agency contract pauses and cancellations
Filing impact: 10-Q filings begin adding cautionary language about government restructuring
Scale Becomes Clear
Q2-Q3 202513,440 contracts ($61B) and 15,887 grants ($49B) terminated
Filing impact: Annual 10-K filings include explicit DOGE risk factors for first time
Defense Budget Shows $11B in Efficiencies
Q4 2025Budget documents reveal Navy $3.7B, Army $3.2B, Air Force $2.3B in cuts
Filing impact: Defense contractors update risk factors; some reclassify revenue segments
FY2025 10-Ks Being Filed
Early 2026Full fiscal year impact now visible in annual filings
Filing impact: First complete annual picture: backlog changes, revenue impact, forward guidance
How the Language Changed: Before, During, and After DOGE
The most revealing thing about DOGE is not the dollar figures - it is how companies changed the words they use in their SEC filings. Risk factor language in 10-K filings is written by securities lawyers who choose every word carefully, because those words carry legal liability. When the language shifts, it means the threat is real.
Pre-DOGE (2024 10-K)
Standard boilerplate"Our business depends on continued government spending on defense and intelligence programs. Budget sequestration, continuing resolutions, or government shutdowns could delay or reduce contract awards."
Analysis: Generic budget risk - same language used for 15+ years
Transitional (Q1-Q2 2025)
Cautious acknowledgment"Recent executive actions to restructure federal agencies and reduce government spending could result in contract terminations, scope reductions, or delays in new procurements affecting our revenue and backlog."
Analysis: References restructuring but avoids naming DOGE directly
Current (FY2025 10-K)
Direct and specific"The Department of Government Efficiency and related executive initiatives have resulted in the termination, modification, or suspension of certain federal contracts and grants. These actions have affected and may continue to affect our contract backlog, revenue visibility, and ability to plan capital allocation."
Analysis: Names DOGE explicitly; quantifies impact areas; forward-looking risk
The Disclosure Progression Pattern
This three-stage evolution - boilerplate, cautious acknowledgment, explicit naming - is the same pattern we saw with COVID-19 disclosures in early 2020 and China tariff disclosures in 2018. When companies move from generic to specific risk language in consecutive filings, it means the legal team has concluded the risk is material.
The key signal: If a company named DOGE in their most recent filing but used generic language before, their lawyers believe the impact is significant enough to require specific disclosure. That is a stronger signal than any analyst estimate.
Company-by-Company: Who Is Most Exposed
Not all government contractors face the same DOGE risk. The critical variable is the civilian-vs.-defense revenue split. DOGE has primarily targeted civilian agency contracts - IT modernization, consulting services, healthcare administration - while core defense and intelligence programs have been more insulated.
| Company | Govt Revenue | Civil/Defense Mix | Risk Level | Disclosure Status |
|---|---|---|---|---|
| Booz Allen Hamilton (BAH) | 97% government | ~45% civilian / ~55% defense | High | Added DOGE-related risk language in Q3 2025 10-Q; expanded in FY2025 10-K |
| Leidos (LDOS) | 87% government | ~35% civilian / ~65% defense | Medium-High | New risk factor referencing government restructuring in FY2025 10-K |
| SAIC | 95% government | ~40% civilian / ~60% defense | Medium-High | Expanded government budget risk factors; referenced efficiency initiatives |
| CGI Group (GIB) | ~35% government | ~70% civilian / ~30% defense (of govt portion) | Medium | Added U.S. government spending risk to North American segment discussion |
| Palantir (PLTR) | ~55% government | ~25% civilian / ~75% defense | Low-Medium | Minimal new DOGE language; positioned as efficiency enabler |
The Palantir Exception
Among major government technology companies, Palantir stands out as a potential DOGE beneficiary rather than a victim. DOGE reportedly uses Palantir tools for its government spending analysis, and the company has positioned its Foundry and Gotham platforms as the kind of efficiency-enabling technology that DOGE advocates.
Filing signal: Compare how Palantir discusses government efficiency in its 10-K versus how BAH or Leidos discuss it. One company sees opportunity language; the others see risk language. That divergence tells you everything about which side of the DOGE equation each company sits on.
Sector-by-Sector: Where DOGE Cuts the Deepest
The DOGE impact is not evenly distributed across the government contracting ecosystem. Understanding which sectors face the most disruption requires reading the 10-K filings of companies across the industry.
IT Services & Consulting
Highest ExposureCivilian agency IT modernization contracts are DOGE primary targets
Accenture Federal, Deloitte Federal, IBM Consulting, CGI Federal
GSA top 10 consulting firms face $94B in unexercised contract ceilings under scrutiny
In plain English: Like a retailer where the landlord is reconsidering whether to renew the lease
Defense & Intelligence
Medium ExposureCore defense programs largely protected; support services face cuts
Lockheed Martin, Northrop Grumman, RTX, General Dynamics
$11B in defense efficiencies identified but focused on logistics, not weapons programs
In plain English: The factory is safe but the back office is getting audited
Healthcare IT & Services
High ExposureHHS, CMS, and VA contracts under direct DOGE review
Maximus, Conduent, EXL Service, Cognizant (federal health)
Medicare/Medicaid IT and eligibility processing contracts at risk
In plain English: The programs survive but the contractors running them may not
Research & Grants
Highest Exposure15,887 grants totaling $49B canceled; affects universities and research orgs
Not directly publicly traded, but university-adjacent biotech and research firms affected
NIH, NSF, DOE grant pipelines disrupted; downstream effects on pharma R&D
In plain English: The seed funding for the next generation of innovation is being questioned
The Five-Step DOGE Exposure Checklist
If you hold shares in any company that derives revenue from U.S. government contracts, here is how to assess your exposure using their SEC filings. Each step targets a specific section of the 10-K.
1. Calculate Government Revenue Exposure
What percentage of total revenue comes from U.S. government contracts?
Where to look: 10-K Business Description and Segment Reporting sections
✓ Green Flag:Less than 30% government revenue, or primarily defense/intelligence (more insulated)
✗ Red Flag:Over 70% government revenue with heavy civilian agency exposure
2. Read the Backlog Disclosure
Has funded backlog declined or has unfunded backlog language changed?
Where to look: 10-K MD&A section, specifically order backlog discussion
✓ Green Flag:Funded backlog stable or growing; unfunded backlog conversion rate unchanged
✗ Red Flag:Backlog declining; new language about contract modifications or at-risk contracts
3. Check for New Risk Factors
Did the company add new risk factors specifically referencing DOGE or government restructuring?
Where to look: 10-K Item 1A Risk Factors - compare to prior year filing
✓ Green Flag:No new government restructuring risks, or company positions as efficiency enabler
✗ Red Flag:New, specific risk factors naming DOGE, contract terminations, or scope reductions
4. Follow the Cash Flow
Has the company changed its cash flow guidance or capital allocation plans?
Where to look: Earnings call transcripts and 10-K MD&A liquidity section
✓ Green Flag:Maintained or increased buybacks and dividends; stable free cash flow guidance
✗ Red Flag:Pulled guidance, reduced buybacks, or added language about preserving liquidity
5. Evaluate the Civilian vs. Defense Mix
What proportion of government work is civilian agency vs. defense/intel?
Where to look: 10-K Segment Reporting and any supplemental customer concentration tables
✓ Green Flag:Primarily defense, intelligence, or national security (historically more stable)
✗ Red Flag:Heavy exposure to civilian agencies, especially HHS, GSA, or education departments
The Bigger Picture: What DOGE Teaches Us About Reading Risk Factors
Beyond the specific investment implications, DOGE is a masterclass in how new risks enter the SEC filing ecosystem. The pattern is always the same: something unprecedented happens, companies initially hope it goes away, then lawyers force them to disclose, and finally the disclosure language stabilizes into a new category.
✓ Previous New Risk Categories
- • 2008: Counterparty risk (financial crisis)
- • 2018: Tariff and trade war risk (China)
- • 2020: Pandemic and remote work risk (COVID-19)
- • 2023: AI disruption risk (ChatGPT effect)
- • 2025: Government restructuring risk (DOGE)
✗ What Makes DOGE Unique
- • Targeted at specific contracts, not systemic budget cuts
- • Executive-driven, bypassing normal appropriations process
- • Speed: 12 months from creation to $110B in action
- • Unpredictable: no formula or threshold for which contracts get cut
- • Politically charged: disclosure itself becomes a statement
The Investor Takeaway
When a new risk category appears in SEC filings, the first companies to disclose are telling you the truth about their exposure. The companies that are slow to add the language are either less exposed or hoping the risk goes away. By comparing who disclosed what and when across the government contracting sector, you can build a more accurate picture of real impact than any analyst estimate provides. The filings do not lie - the question is whether you read them early enough.
The Bottom Line
Three Takeaways for Investors
DOGE Is a Filing Event, Not Just a Headline
The $110B in terminated contracts and grants is now showing up in legally binding SEC filings. When companies name DOGE in their risk factors, their lawyers have concluded the impact is material. That is a stronger signal than any political commentary.
Civilian vs. Defense Is the Key Variable
Companies with heavy civilian agency exposure face the most risk. Defense and intelligence contractors are more insulated. The 10-K segment reporting tells you the exact split - read it before making allocation decisions.
Compare Filings Across the Sector
The most valuable analysis is cross-company: who added DOGE risk factors and who did not? Who quantified the impact and who used vague language? The divergence between disclosures reveals the real winners and losers.
Track Government Contractor Filings
We monitor 8-K material events, 10-K risk factors, and earnings disclosures for major government contractors and 130+ other companies. When the next wave of DOGE contract actions hits, you will see it in the filings first.
Disclaimer: This analysis is for educational and informational purposes only. It is not investment advice. The author may or may not hold positions in the securities mentioned. Always do your own research and consult with a qualified financial advisor before making investment decisions.
All data sourced from public SEC filings, government budget documents, and reputable financial news sources. The Department of Government Efficiency impact figures are based on published government data and reporting from The Washington Post, Breaking Defense, and other outlets. Analysis and opinions are those of the author. Past performance does not guarantee future results.