A contracting agency known as Leidos took in additional than $16 billion in income final 12 months, most of it by way of contracts with federal companies just like the Division of Veterans Affairs.

So when the Trump administration’s price range cutters took purpose on the V.A. final month, it appeared like unhealthy information not only for the division’s workers but additionally for Leidos and dozens of different private-sector corporations.

“No extra paying consultants to do issues like make Energy Level slides and write assembly minutes!” the division’s secretary, Doug Collins, wrote on X. General, the division stated, it was canceling greater than 850 contracts price practically $2 billion.

However shortly after Mr. Collins’s announcement, the outlook for a few of the V.A.’s contractors appeared to brighten. The division put the cancellations on pause, saying it wanted to overview the contracts to keep away from “eliminating any advantages or companies” to veterans or V.A. beneficiaries. It later narrowed the list of canceled contracts by a number of hundred.

And consultants on authorities contracting stated cuts to the company, which introduced final week that it was searching for to trim 80,000 of its roughly 480,000 workers, may even result in elevated spending on federal contracts.

These consultants famous that reducing workers with out reining in a authorities perform — like offering well being care and advantages to veterans, work during which Leidos performs a key function — sometimes means the job will fall extra closely on contractors.

“For those who reduce individuals and also you don’t reduce the mission, it’s important to depend on different sources to do the work,” stated Stan Soloway, a Protection Division official within the Clinton administration who has led a commerce group representing authorities contractors.

A Leidos spokesman, Brandon Ver Velde, stated in a press release, “We strongly help the purpose of making a dramatically extra environment friendly and efficient federal authorities that prices taxpayers much less cash,” including that “delivering improvements that do that’s core to our mission.”

Nevertheless it shakes out, the insular and little-understood world of federal contractors is in no way resistant to the uncertainty that President Trump and Elon Musk, the pinnacle of his authorities effectivity initiative, have delivered to the federal equipment.

Within the months after the presidential election, because it grew to become clear that Mr. Trump and Mr. Musk would rein in federal companies, the share costs of publicly traded contractors like Leidos and Booz Allen Hamilton plummeted. (The costs are nonetheless up from earlier this decade.)

Then one of many authorities’s prime officers involved in procurement, the performing head of the Basic Companies Administration, despatched a memo final month asking the heads of federal companies to overview a listing of doubtless nonessential contracts — those who generate solely “a report, analysis, teaching or an artifact” — and defend any they deemed important.

A follow-up memo listed the ten highest-paid consulting corporations throughout the federal government and stated they have been scheduled to obtain over $65 billion in charges starting this 12 months. “Please present us with a listing of the contracts with these corporations that your company intends to terminate and those who it intends to take care of,” the memo added.

Leidos and Booz Allen have been on the record. Workers of some contractors stated their corporations had mentioned job cuts amid the scrutiny.

However the Trump administration seems to have softened its stand since then. After conferences with executives of enormous contracting corporations, The Wall Street Journal reported, one other prime G.S.A. official stated in a press release that “we worth their partnership” and that “we welcome them working with us to lower our extreme authorities spending whereas persevering with to supply the important companies the federal government wants.”

Inventory analysts who observe corporations specializing in federal contracts stated they have been usually bullish on the businesses’ prospects. “Quick time period, there’ll most likely be some disruption and uncertainty for the contractors,” stated Scott Mikus, a director at Melius Analysis who follows federal contractors. “However most likely within the medium to long run it’s factor.”

Matthew Akers, an fairness analyst at Wells Fargo, famous that for all of the attention-grabbing headlines, the federal government had canceled few giant contracts up to now. “If there was low-hanging fruit they may have reduce,” he stated, “I feel they’d have completed it.”

Leidos seems for instance the purpose. Based by a nuclear physicist in 1969, the corporate was soon hired to check the consequences of nuclear weapons by the federal authorities, which had simply stopped conducting atmospheric assessments in favor of simulations. The corporate, then often known as Science Functions Inc. (and later SAIC), entered the well being care enterprise the next year, successful a federal contract to check radiation therapy for most cancers.

Like many federal contractors, SAIC benefited when the Clinton administration trimmed the federal work power by a whole lot of hundreds and ended up rising the federal government’s reliance on non-public corporations, based on a 2011 report by the Venture on Authorities Oversight, a nonprofit group that displays federal contracting. The George W. Bush administration expanded contracting additional.

The corporate went public in 2006 and renamed itself Leidos in 2013, spinning off SAIC as a smaller consulting enterprise. A sequence of acquisitions vastly expanded its measurement and attain.

In the present day, Leidos makes merchandise as diverse as airport scanners and guided missiles. It develops offensive and defensive cyber capabilities, conducts intelligence evaluation, upgrades pc techniques at a number of federal companies, performs medical exams for veterans and runs a federally funded cancer research lab, the place it employs greater than 2,000 scientists, technicians and directors.

Whereas these will not be companies that might usually be housed inside a single firm, authorities contracting creates a robust rationale for combining them: All the companies profit from Leidos’s intimate data of the often-convoluted and time-consuming strategy of successful federal contracts.

“Understanding the procurement course of, from the award to the contract efficiency to invoicing to the cost cycle, is admittedly, actually vital,” stated Robert Guerra, who spent a long time in senior positions at federal contracting corporations. “You might want to have techniques in place to do it.”

With the federal government buying greater than $450 billion in companies and greater than $250 billion in items every year, leaping by way of such hoops will be profitable. Based on a federal securities submitting, Leidos, which employs practically 50,000 individuals, earned greater than $16 billion in income final 12 months and about $1.25 billion in revenue. The corporate stated that just about 90 p.c of its income got here immediately or not directly from federal contracts, and that contracts with the Pentagon or U.S. intelligence companies generated about half of its income.

To date, Leidos has suffered little lack of enterprise. In a report circulated in February, Mr. Akers of Wells Fargo stated Leidos is likely to be extra uncovered to cuts than different contractors as a result of extra of its enterprise lay on the civil aspect of the federal government’s ledger than with the navy. He famous that Mr. Musk’s Division of Authorities Effectivity had already recognized financial savings of greater than $200 million from a Leidos info expertise contract with the Social Safety Administration.

However the determine gave the impression to be an error, and the one financial savings from a Leidos contract with the Social Safety Administration gave the impression to be price about $500,000, as Mr. Akers famous in a later report.

In different circumstances, Trump administration priorities are prone to deliver new alternatives for the corporate. Leidos not too long ago gained a contract with the V.A. to supply screenings that confirm veterans’ incapacity standing, and it could be effectively positioned to broaden its veteran well being care enterprise amid the cuts on the division.

“They do medical and incapacity exams,” Mr. Mikus stated. “Veterans are nonetheless going to want care as you’re making an attempt to work down the backlog of circumstances.” Leidos stated that it didn’t see itself as a substitute for V.A. workers however that it may assist the division serve veterans higher.

Peter Kasperowicz, a V.A. spokesman, stated by electronic mail that the company was working to redirect billions of {dollars} in “non-mission-critical efforts” to scale back backlogs and enhance care. He added, “Contracts will likely be canceled in some cases, and in different cases new contracts will likely be created to scale back duplicity and leverage higher shopping for energy.”

In fact, it could be a mistake to imagine that the uncertainty created by Mr. Trump and Mr. Musk will finally move, returning the contracting enterprise to its pre-election state. Federal contracting has historically offered corporations with secure, predictable income however decrease revenue margins than extra unstable private-sector work. If the federal authorities is now not a dependable buyer, the economics of the enterprise might change.

“You’ve bought to cost in ‘What chance do I feel this may occur?’” stated Mr. Guerra, the longtime contractor, alluding to the chance that the Trump administration will abruptly cancel a contract. He urged that corporations may start to imagine a contract was price, say, 5 p.c lower than the acknowledged quantity to account for such danger.

Nonetheless, the business has arguably survived worse, together with spending cuts from a deal between President Barack Obama and congressional Republicans.

Across the similar time, in June 2013, information retailers printed revelations offered by Edward J. Snowden, a Booz Allen worker who leaked one of the crucial important troves of categorized paperwork in U.S. historical past. The share worth of his employer rapidly dropped greater than 5 p.c as buyers appeared to fret that the federal government would curtail its use of contractors on delicate nationwide safety work.

However inside a month or two, the disaster had handed, and Booz Allen inventory was up about 20 p.c. As of this month, its share worth had appreciated many occasions over.

Jack Begg and Kirsten Noyes contributed analysis.