Accenture Adjusts Financial Outlook Amid Varied Quarterly Performance
$ACN
Accenture Plc. (NYSE:ACN) is a leading global professional services company, offering a broad range of services and solutions in strategy, consulting, digital, technology and operations. With a strong presence in the IT services industry, Accenture is renowned for its expertise in driving technological innovation and delivering transformational outcomes for a diverse client base that spans multiple industries. This strategic positioning allows the company to play a pivotal role in the digital transformation journeys of its clients worldwide.
Accenture Plc. has recently adjusted its financial outlook for the year, following a mixed performance in its third fiscal quarter of 2024. The company reported earnings of $3.13 per share, which fell short of the Zacks Consensus Estimate by 0.32%. This represents a slight decrease from the $3.19 per share reported in the same quarter of the previous year. Total revenue for the quarter was $16.47 billion, a marginal decline of 0.6% year over year and slightly below the Zacks Consensus Estimate of $16.52 billion. The firm’s revenue streams showed varied performance across different sectors and regions.
Managed Services revenue increased by 2% on a reported basis and 4% in local currency, totaling $8 billion, although it fell short of expectations. Consulting revenues decreased by 3% on a reported basis to $8.5 billion. Notably, Health & Public Service revenues grew by 8%, while Financial Services saw an 8% decline. Geographically, revenues from North America showed a modest increase of 1%, amounting to $7.8 billion. However, revenues from the Growth Markets and EMEA regions experienced declines, with Growth Markets revenues decreasing by 4% and EMEA by 2%.
In terms of new bookings, Accenture reported a significant increase, with total bookings reaching $21.1 billion, marking a 22% rise from the previous year. This boost was largely driven by a surge in bookings related to generative AI technologies, totaling over $900 million. The operating results remained stable, with a gross margin of 33.4% and an adjusted operating margin of 16.4%, showing a slight improvement from the previous year. The company also highlighted its cash management, reporting $1 billion in free cash flow and repurchasing 4.3 million shares for $1.4 billion. Looking ahead to the fourth quarter of fiscal 2024, Accenture has revised its revenue guidance downward to between $16.05 billion and $16.65 billion, compared to the previously stated range of $16.25 billion to $16.85 billion.
The company also adjusted its full-year earnings per share guidance to $11.85-$12.00, down from the earlier forecast of $11.97-$12.20. These adjustments, Accenture remains optimistic about its growth prospects, particularly with the increasing adoption of artificial intelligence solutions across various industries. The strategic focus on expanding its AI capabilities is expected to continue driving growth and innovation in the coming quarters.
**DISCLAIMER: THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND SHOULD NOT BE INTERPRETED AS INVESTMENT ADVICE. INVESTING INVOLVES RISK, INCLUDING THE POTENTIAL LOSS OF PRINCIPAL. READERS ARE ENCOURAGED TO CONDUCT THEIR OWN RESEARCH AND CONSULT WITH A QUALIFIED FINANCIAL ADVISOR BEFORE MAKING ANY INVESTMENT DECISIONS.**
