Accenture consulting revenue falls in third quarter year-over-year

(Alliance News) - Accenture PLC saw its third quarter marked by a loss in consulting business ...

Alliance News 20 June, 2024 | 8:18PM
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(Alliance News) - Accenture PLC saw its third quarter marked by a loss in consulting business revenue, though it was partially offset by growth in its Managed Services business and an increase in bookings.

In its third quarter ended May 31, the Dublin-based information technology consulting firm saw revenue decrease 0.6% to USD16.47 billion from USD16.56 billion in the third quarter of last year.

Despite the fall in revenue, shares were up 8.0% at USD308.13 in New York on Thursday afternoon.

The company attributes the decrease to its consulting business revenue falling 2.7% year-over-year to USD8.46 billion from USD8.69 billion.

"The decline in consulting revenue in local currency for the third quarter of fiscal 2024 was driven by a decline in [Europe, Middle East and Africa], partially offset by solid growth in Growth Markets and modest growth in North America. While we continue to experience demand for these services, we are seeing a slower pace and level of client spending, especially for smaller contracts with a shorter duration," Accenture said in its report.

Its Managed Services business revenue grew 1.8%, however, to USD8.01 billion from USD7.87 billion, partially offsetting the loss.

"We continue to experience growing demand to assist clients with application modernization and maintenance, cloud enablement and cybersecurity-as-a-service. In addition, clients continue to be focused on transforming their operations through technology, data and AI, and leveraging our digital platforms and talent to drive productivity and operational cost savings," the company added.

Using generally accepted accounting principles, Accenture operating income rose 12% to 2.63 billion from USD2.36 billion while operating margin was 16%, compared to 14.2% last year.

GAAP diluted earnings per share were down 3% to USD3.04 from USD3.15 in the third quarter of last year.

In the quarter, Accenture returned USD2.20 billion to shareholders through USD811.0 million in cash dividends and USD1.40 billion in buybacks.

It had cash equivalents of USD5.50 billion, down 39% from USD9.00 bullion at the end of its last financial year on August 31, 2023.

During the quarter, it saw new bookings worth USD21.10 billion, up 22% from last year.

On June 11, Accenture announced it will move its Latin America market from its Growth Markets to its North American market designation. As a result, the North American market will be renamed The Americas market and its Growth Markets business will become the Asia Pacific market. The change is effective September 1.

By Aidan Lane, Alliance News reporter

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Rating
Accenture PLC Class A 329.78 USD -0.52

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