Accenture ups FY25 revenue guidance by 3-6%; unveils $4 bn share buyback

Global IT services giant Accenture has reported revenue of $16.4 billion for the fourth quarter, an increase of 3% in U.S. dollars and 5% in local currency compared with the fourth quarter of fiscal 2023. The revenue was above the midpoint of the company’s guided range of $16.05 billion to $16.65 billion. Accenture says the foreign-exchange impact for the quarter was around negative 2%, consistent with its Q3 earnings forecast.

The company recorded new bookings of $20.1 billion for the quarter and $81.2 billion for the full year, a 13% increase in U.S. dollars and 14% increase in local currency for the full year.

The Dublin, U.S.-based company, which employees around 3 lakh employees across its various offices in India, says its GAAP operating income was $2.35 billion, compared to $1.91 billion for the fourth quarter of fiscal 2023. The operating margin stood at 14.3%, compared to 12% for the fourth quarter last year.

The company's adjusted operating income came in at $2.46 billion compared to $2.38 billion for the fourth quarter of fiscal 2023. The adjusted operating margin stood at 15%, compared to 14.9% for the fourth quarter last year.

Adjusted earnings per share or EPS were $2.79, an increase of 3% over $2.71 for the fourth quarter of fiscal 2023. Accenture says its operating cash flow was $3.39 billion for the said quarter and free cash flow stood at $3.18 billion. New bookings were $20.1 billion during the period.

The revenues for whole fiscal year 2024 stood at $64.90 billion, compared with $64.11 billion for fiscal 2023, an increase of 1% in U.S. dollars and 2% in local currency.

Julie Sweet, chair and CEO, Accenture, says the company delivered full-fiscal year new bookings of $81 billion, including a record 125 quarterly client bookings of more than $100 million, and now has 310 Diamond clients. "We continue to accelerate our leadership in Generative AI, delivering $3 billion in new bookings for the year. Our continued investments in our business have positioned Accenture for strong growth in fiscal 2025,” says Sweet.

Revenue guidance up & mega buyback

In its guidance for the first quarter (fiscal 2025), Accenture expects revenues to be in the range of $16.85 billion to $17.45 billion. This reflects the IT service behemoth's assumption of around positive 1.5% foreign-exchange impact compared with the first quarter of fiscal 2024. For the whole fiscal year 2025, Accenture says the foreign-exchange impact on its results in U.S. dollars will be around positive 1.5% compared with fiscal 2024. For fiscal 2025, the company expects revenue growth to be in the range of 3% to 6% in local currency.

In fiscal 2024, the company says it returned $7.8 billion to shareholders, including $4.5 billion in share repurchases and $3.2 billion in cash dividends.

As part of its share buyback programme, Accenture says it repurchased or redeemed 2.1 million shares in FY24, including 2.0 million shares repurchased in the open market, for $628 million. This brought total share repurchases and redemptions for FY24 to 14.0 million shares.

The company’s board has also approved $4 billion in additional share repurchase authority, bringing Accenture’s total outstanding authority to around $6.7 billion. As of August 31, 2024, Accenture had around 626 million total shares outstanding.