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3 Technologies for Navigating Tariffs, Budget Cuts, and Uncertainty 

The first 100 days of President Trump’s second term have largely focused on reshaping the federal government’s bottom line. DOGE’s targeted budget cuts have attempted to slash spending while tariffs have been implemented to increase revenue. More broadly, the President’s first 100 days have been riddled with uncertainty. The markets are reacting accordingly. Many experts are now whispering about the threat of a recession.

The day after Trump announced 10% tariffs on all imports, the Magnificent 7 lost over $1 trillion in collective market capitalization as the S&P 500 and Nasdaq had their worst day since the coronavirus pandemic.1,2 While now might not feel like the best time for technology and AI, buying into the sector now, while valuations are lower, may prove fruitful in the long run. There are three technologies in particular that are well-poised to navigate the major economic challenges of today and the future.

Software vs. Tariffs

Tariffs are a tax American companies have to pay on imported goods. When tariffs increase costs for imported materials or finished goods, companies have less margin to work with. They either have to eat the cost or pass it to the customer, both of which can hurt competitiveness. So the name of the game becomes: “Do more with less.”

Software can step in to help companies become more productive and efficient in these leaner times. Innovative companies, like Samsara, are optimizing their customers’ operations by spotting bottlenecks, optimizing schedules, and reducing redundancies. Software is also being used to reduce waste, maximize labor, and manage projects and inventory. The full brunt of tariffs won’t be felt for many months to come, but software is poised to help companies impacted by them do more with less.

AI vs. Budget Cuts

The Department of Government Efficiency (DOGE) has been tasked with cutting federal spending. Controversy and uncertainty aside, budget cuts always mean layoffs and usually mean fewer people doing the same amount of work. Much like with tariffs, organizations impacted by DOGE cuts will have to find their own efficiencies.

For the research and healthcare sectors, this may mean utilizing AI models and simulations instead of more labor- and resource-intensive methods. For example, the U.S. Food and Drug Administration (FDA) recently announced it will be deemphasizing animal testing for new drugs in favor of AI models.3 Companies that develop or integrate AI drug discovery platforms, like Shrodinger and Eli Lilly, are well-poised to benefit from the move toward AI-based pharmaceutical testing amidst budget cuts across research specialties and the healthcare sector.

Cybersecurity vs. Uncertainty

Intimately related to tariffs and budget cuts has been an overwhelming sense of uncertainty and volatility. Economic downturns, budget cuts, and uncertainty become breeding grounds for cybersecurity threats as attackers seek to take advantage of the chaos and IT teams are stretched too thin.

In addition to preventing data breaches and disruptions, investing in cybersecurity will also save companies millions of dollars. The average cybersecurity attack in 2024 cost $4.88 million.4 Cybersecurity companies, particularly those innovating in third-generation cybersecurity like Crowdstrike, Okta, Sentinel One, Zscaler, and Cloudflare, are poised to cement themselves as essentials during these uncertain times.

All of the companies included above are current holdings of the TrueShares Technology, AI, and Deep Learning ETF (LRNZ) because they are significantly involved in the application of advanced levels of artificial intelligence within their businesses. LRNZ is concentrated in 20-30 positions that are all category killers, from software, AI, and cybersecurity to semiconductors, biotech, and automotive. The most important aspect of LRNZ, though, is its use of fundamentals by a portfolio manager who is deeply embedded in the relevant news and its impact on today’s (and the future’s) most promising tech stocks. 

For more information and a full list of holdings, visit: https://www.true-shares.com/lrnz/ 

  1. https://www.cnbc.com/2025/04/03/mag-7-relinquishes-more-than-800-billion-as-tech-drives-stock-market-nosedive.html
  2. https://www.nytimes.com/live/2025/04/04/business/trump-tariffs-stocks-economy 
  3. https://www.fda.gov/news-events/press-announcements/fda-announces-plan-phase-out-animal-testing-requirement-monoclonal-antibodies-and-other-drugs 
  4. https://legal.thomsonreuters.com/blog/the-cost-of-data-breaches/ 
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