This post was originally published on this site
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 (NYSE:ACN), 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.
