Accenture second-quarter forecast disappoints as IT spending weakens


Accenture Plc beat quarterly estimates for revenue and earnings on Friday but forecast second-quarter sales slightly lower than expectations, signaling pressure as companies curtail IT spending due to macroeconomic uncertainty.

After a boom during the pandemic, spending on IT and transformation projects is normalizing as companies see growth slowing.

Firms are prioritizing shorter-duration projects with stronger return-on-investments (ROIs), dampening the outlook for services players such as Accenture, Piper Sandler lead analyst Arvind Ramnani wrote in a recent note to investors.

Accenture forecast second-quarter revenue in the range $15.20 billion to $15.75 billion. The mid-point of the guidance is lower than analysts’ estimate of $15.61 billion, according to Refinitiv.

New bookings in the quarter ended Nov. 30 were $16.22 billion, 3% lower than the previous year and about 12% down from the prior quarter. Shares fell 3% lower in premarket trade.

Revenue in the reporting quarter grew 5% to $15.7 billion, higher than analysts’ average estimate of $15.58 billion. Accenture flagged a negative impact of about 9.5% on sales from a stronger dollar.

The company earned $3.08 per share, beating analysts’ estimate of $2.91.

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