Accenture Plc beat quarterly estimates for revenue and earnings on Friday but forecast second-quarter sales slightly lower than expectations, signalling pressure as companies curtail IT spending due to macro economic uncertainty.
After a boom during the pandemic, spending on IT and transformation projects is normalising as companies see growth slowing.
Firms are prioritising 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 November 30 were $16.22 billion, 3 per cent lower than the previous year and about 12 per cent down from the prior quarter. Shares fell 3 per cent lower in premarket trade.
Revenue in the reporting quarter grew 5 per cent to $15.7 billion, higher than analysts' average estimate of $15.58 billion. Accenture flagged a negative impact of about 9.5 per cent on sales from a stronger dollar.
The company earned $3.08 per share, beating analysts' estimate of $2.91.