ICF lays out the risks, opportunities from Trump's push for cuts
ICF's chief executive John Wasson. Courtesy of ICF.
By
Ross Wilkers
The company has quantified the risks from actions like stop-work orders and contract terminations, but is also looking at the tech business as where some opportunity exists.
Publicly traded government contractors have a unique approach to transparency with their investors, given they have to release financial results and the factors underlying those numbers.
GovCon companies also have a customer that publicly discloses how it spends against budgets, which equates to revenue for firms.
During ICF’s fourth quarter earnings call with investors Thursday, chief executive John Wasson laid out much of what the company knows so far as a result of the Trump administration’s push to cut certain elements of federal spending.
Wasson said ICF currently estimates the maximum revenue risk at around $202 million for 2025, which equates to a 10% of the roughly $2 billion in sales posted for 2024.
Those figures cover multiple types of agency actions such as stop-work orders, delayed payments for completed work and contract terminations.
Approximately $90 million of ICF’s estimated 2025 revenue has been impacted so far with the majority of that related to the wind-down of the U.S. Agency for International Development, Wasson told analysts.
The bulk of Reston, Virginia-headquartered ICF’s work for USAID supported the collection of demographic and health data in certain countries to help better allocate resources for underserved groups.
For some added context: ICF posted around $1.1 billion in federal government revenue in 2024 to account for 55% of overall corporate sales.
All of that adds up to 2025 being a “transition year” for ICF, as Wasson characterized it for analysts.
“There's a reset of the priorities and where the focus is going to be with this administration,” Wasson said. “But I think once we get beyond '25, there will be opportunities, and our goal is to manage the business very carefully.”
One significant element of that management pertains to ICF’s workforce that stands at 9,000 employees. Wasson acknowledged the “potential for impacts” on that front, but added the company has a blueprint for redeploying people.
“We're certainly going to look for every opportunity to leverage that staff and the capabilities across the full portfolio of work,” Wasson said.
ICF’s initial outlook for 2025 pegs 55% of its total revenue coming from clients in the commercial, state and local government, and international government segments. Wasson said ICF is forecasting 15% total growth in 2025 from those markets.
But as with any disclosure of risk, publicly traded companies have an unspoken requirement of laying out the opportunities in front of them as a way to help investors and employees consider all factors.
Take IT modernization and digital transformation work for instance, which ICF has regularly called out as one of the handful of key growth drivers for the long term.
Wasson said ICF does see the potential for “revenue shrinkage of mid-to-high single digits” in its tech business for 2025, but a more positive picture for future years beyond that.
The new Trump administration is seeking to lean heavily on technology as a means to achieve its efficiency and modernization goals, including through the Elon Musk-led Department of Government Efficiency.
“As the administration puts its new technology strategy in place and finalizes that and continues to review the existing projects, I think that will slow down IT modernization efforts here for a few quarters,” Wasson said. “But we do believe, as we get to the second half of the year and we go forward, there will be new opportunities with this administration on the technology front.
“I think it's committed to efficiency, to innovation, to leveraging AI, to leveraging software across all the federal government, reducing waste fraud abuse all areas that we can play in on the technology front. So I think we would expect to see growth opportunities as we go forward into 2026 and beyond in that market.”
It is important to note that ICF’s current estimations of the risks to its business for 2025 do not contemplate impacts from an “an extensive government shutdown,” nor prolonged pauses in funding for existing contracts or new procurements.
Those two risks are hardly unique to ICF, however.
ICF also recorded $226 million in profit for 2025, representing a 6% year-over-year increase in adjusted EBITDA (earnings before interest, taxes, depreciation and amortization). That translates to a margin of 11.2% compared with the 10.9% figure for 2023.
The company plans to maintain its 2025 margin at a level comparable to 2024.