Accenture Increases Revenue Forecast Despite Recession Fears
Global IT consulting firm Accenture remains in rapid growth mode — despite recession fears across the U.S. economy. The upbeat Accenture business forecast provides welcome news to peer IT consulting firms and MSPs that are striving to navigate economic headwinds such as rising interest rates, high inflation and a tight labor market.
Among the upbeat data points that Accenture shared on June 23, 2022:
- Revenue was $16.2 billion in Q3 of fiscal 2022, up 22% compared to Q3 of fiscal 2021;
- and net income was $1.82 billion, up 16% from the corresponding quarter last year.
- Moreover, Accenture expects its full-year revenue to grow roughly 25.5% to 26.5% — which is stronger than previously expected.
Still, Wall Street had mixed reaction to the quarterly results. While Q3 revenue generate beat analyst expectations, Q3 earnings per share were slightly below Wall Street’s forecast, SeekingAlpha reported.
Accenture: IT Consulting and Outsourcing Business Growth
Nevertheless, Accenture’s business appears to be performing well on multiple fronts. In a prepared statement about the quarterly results, Accenture CEO Julie Sweet said:
“Our very strong financial results for the third quarter reflect continued broad-based demand across markets, services, and industries, and the continued recognition of the outstanding talent of our 710,000 people. We continue to gain significant market share, and our services have never been more relevant as our clients turn to us as the trusted partner for the solutions they need to accelerate growth and become more resilient and efficient.”
That growth includes a mix of IT consulting revenues (up 24% in Q3) and outsourcing revenues (up 19% in Q3).
Accenture M&A Budget Targets Cloud, Cybersecurity and More
Accenture’s growth also involves ongoing acquisitions. Indeed, Accenture plans to spend roughly $4 billion on acquisitions during the current fiscal year. Roughly $1.8 billion of that $4 billion M&A budget was spent on 21 acquisitions during the first half of Accenture’s fiscal year 2022, CFO KC McClure indicated during an earnings call on March 17, 2022.
Many of the Accenture acquisitions focus on cloud services, cybersecurity, digital transformation, data and analytics, managed services, sustainability and ad agencies. We’ll be listening for updated M&A budget information during the Q3 earnings call today.