Accenture’s Bet on Cloud and Digital Services Is Paying Off
Consulting and outsourcing services provider Accenture (ACN) reported a better-than-expected quarterly revenue on Thursday, as the company’s investments to boost its digital and cloud services pay off.
Shares of the company fell 1.3% to $125.40 in premarket trading after Accenture trimmed its annual revenue forecast.
The company said it now expects net revenue to rise 6% to 7% for the year ending August, compared with an earlier forecast for a 6% to 8% increase.
Accenture, however, raised its forecast for full-year profit, citing a lower-than-anticipated impact from a strong dollar.
The company now expects full-year adjusted earnings per share of $5.84 to $5.91, compared with a previous forecast of $5.70 to $5.87.
Accenture, like other IT service providers, has beefed up its security, cloud and analytics services to meet burgeoning demand from businesses for digital services.
The Dublin-domiciled company has been investing heavily on acquisitions to boost these services, which now make up about half its total revenue.
Accenture’s net revenue climbed 5.1% to $8.87 billion in the third quarter ended May 31, beating analysts’ average estimate of $8.83 billion, according to Thomson Reuters I/B/E/S.
Net income attributable to Accenture fell to $669.5 million or $1.05 per share, from $897.2 million or $1.41 per share, a year earlier.
Excluding one-time items, Accenture earned $1.52 per share, in line with analysts’ expectations.