Dublin-based Accenture, widely considered as the bellwether for the Indian IT industry, has forecast revenue growth between 3-6% for financial year 2024-25, higher than the 2% growth it has seen in FY24. However, the revenue guidance translates to a range of $66.8 billion to $68.8 billion, the mid point of which still falls short of analysts’ estimate of $68.7 billion, as per Bloomberg data.
But for the first quarter of fiscal 2025, the company’s guided revenue range of $16.85 billion to $17.45 billion topped street estimates of $16.9 billion, encouraged by increased bookings in generative AI deals. Accenture said it recorded $1 billion worth of new bookings in Generative AI in Q4 and that of $3 billion in the entire FY24.
These new GenAI deals translated to nearly $900 million in revenue in FY24, compared to just $100 million in the preceding financial year, according to an internal company email seen by FE.
As for the fourth quarter, the company posted revenue of $16.4 billion, marking a 5% growth year-over-year and inline with analysts’ estimate. Adjusted operating income stood at $2.46 billion compared to $2.38 billion during the same period last year. Earnings per share, adjusted for business optimisation costs, came at $2.79, compared to $2.71 last year.
During the quarter, the company signed new deals worth $20 billion, bringing its total bookings for the year to $81.2 billion. Among these, consulting new bookings were $8.6 billion, while managed services new bookings were $11.6 billion.
In terms of geography, its biggest market North America saw a 6% growth during the quarter, resulting in revenue of $7.97 billion. Europe, Middle East and Africa saw 2% rise in revenue while its growth markets reported an increase of 3%.
Revenue from its product vertical, which contributes the highest to overall revenue, grew 6% to $4.95 billion, followed by its health and public services verticle with 11% rise in revenue to $3.61 billion.
IT companies across the world have grappled with a slowdown in enterprise client spending in the last two years, but with the US Federal Reserve entering a rate-cut cycle, some analysts expect discretionary demand to potentially revive. Analysts with JM Financials noted that the reduced interest burdens on corporations may allow them to hike operational expenses.
