The feds buy a ton of software. These companies are most exposed to the chainsaw.

The White House’s push for deep, extra-budgetary spending cuts across the federal government has emerged as a big concern for companies that count Uncle Sam as an important customer.

Wall Street analysts have started to eyeball the potential damage to profits at key federal tech contractors. Morgan Stanley analysts published their estimates of software stocks with the largest government share of overall revenues.

In addition to Palantir, the list contains market cap heavy hitters like Microsoft and Oracle. (Oracle stumbled last week, in part due to Department of Defense plans to terminate a contract to use Oracle HR software.)

Others on the list, including Crowdstrike and Workday, are also taking it on the chin on Monday. But analysts note that even for companies less reliant on government spending, the uncertainty related to White House pushes for spending reductions and tariffs is unsettling software investors.

In a note published over the weekend titled “Software in the DOG(E) House,” analysts cut their price targets across the sector and noted that a lot of damage has been done.

“Uncertainties around tariffs and DOGE are gradually impacting spending decisions across the tech sector,” Jefferies analysts wrote. “The risk of estimates going lower has translated to lower share prices and valuations.”