Ireland-based Accenture’s shares took a heavy beating on Friday after the professional services company reported a largely better-than-expected set of financial results for the March-May period.
Accenture shares finished lower by $21 or 6.9 per cent to settle at $285.4 apiece after falling as much as 10.8 per cent in intraday trade. The stock had settled at $306.4 apiece the previous day.
Accenture follows a rare September-August financial year. Its latest earnings report was for the March-May quarter.
Why do Accenture results matter? Why do Indian IT investors track ACN earnings?
Indian IT companies as well as Dalal Street investors closely track Accenture numbers to keep a tab on global technology demand trends.
Accenture–whose shares are listed on American stock exchange NYSE and traded with the symbol ‘ACN’–operates in a business model similar to that of some of some of the Tier 1 Indian IT firms, like TCS and Infosys.
Accenture also caters to similar international markets as Indian software exporters.
Given its rather unique financial year, its earnings are out about a month before Indian IT firms’ results.
Now, let’s get to Accenture’s earnings. Here are some of the key highlights from the Irish company’s latest financial results:
Accenture Earnings Takeaways
Top-line
Accenture’s March-May revenue increased 8 per cent in dollar terms and 7 per cent in local currency, exceeding analysts’ estimates, foreign media reported.
The quarterly revenue stood at $17.7 billion.
Earnings per share
The company logged earnings per share (EPS) of $3.49, reportedly better than estimates.
Guidance
Accenture tweaked its guidance for revenue as well as EPS for the full financial year.
It now expects annual revenue growth to be in the range of 6-7 per cent, better than its earlier projection of 5-7 per cent.
Its full-year EPS is now forecast in the range of $12.77-12.89, up from the earlier $12.55-12.79.
Then what troubled Accenture investors?
- Second Straight Fall in Quarterly Bookings: Accenture’s bookings dropped 6 per cent to $19.70 billion for the March-May period, worse than a 3.0 per cent decline recorded in the previous quarter. Bookings determine a company’s future revenue through contract wins.
- Tariff Uncertainty: Analysts say that IT firms are reeling under pressure amidst uncertainty surrounding US tariffs, with the Donald Trump administration’s actions leading to potential deal cancellations and delays.
When will Indian IT firms report financial results next?
India Inc is set to exit the first quarter of FY26 in less than a fortnight, with results for the period due in the following weeks.