Thu, Mar. 24, 11:57 AM
- Accenture's (ACN +3.8%) FQ2 beat has been accompanied by guidance for FY16 (ends Aug. '16) adjusted EPS of $5.21-$5.32, up from a prior $5.09-$5.24 and mostly above a $5.22 consensus.
- FY16 constant currency revenue growth guidance has been hiked to 8%-10% from 6%-9%. With forex still expected to have a 5% impact, dollar-based revenue growth guidance is at 3%-5%, in-line with a 3.7% consensus.
- FQ3 revenue guidance of $8.1B-$8.35B is in-line with an $8.17B consensus. FY16 op. cash flow and free cash flow guidance respectively remain at $4.1B-$4.4B and $3.6B-$3.9B.
- Bookings: New bookings rose by $200M Y/Y to $9.5B. Consulting bookings rose by $800M to $5B, while outsourcing bookings (pressured to an extent by cloud services adoption) fell by $600M to $4.5B. Forex had a 6% impact on bookings growth.
- Segment performance: Telecom/media/tech revenue +6% Y/Y to $1.6B. Financial services +6% to $1.7B. Health/public service +12% to $1.5B. Products (manufacturing) +8% to $2B. Resources (hurt by weak oil/commodity prices) -3% to $1.2B.
Overall, consulting revenue rose 12% to $4.3B, while outsourcing was roughly flat at $3.7B. CEO Pierre Nanterme asserts Accenture "gained significant market share."
- Regional performance: North America revenue +11% to $3.8B. Europe (9% forex impact) +5% to $2.8B. "Growth markets" (14% forex impact) -4% to $1.4B.
- Financials: Buybacks once more boosted EPS: $829M was spent to repurchase 8.1M shares. $6.4B is left on Accenture's buyback authorization. Op. margin rose 10 bps Y/Y to 13.7%. Accenture ended FQ2 with $3B in cash and less than $30M in debt.
- Along with the numbers, Accenture has declared its semi-annual $1.10/share dividend (2% yield). The next dividend will be paid on May 13 to shareholders on record as of April 15.
- Accenture's FQ2 results, earnings release
Thu, Jan. 14, 1:12 PM
- Infosys (NYSE:INFY) has jumped to its highest levels since November after beating FQ3 revenue estimates (EPS was in-line) and raising its FY16 (ends March '16) dollar-based revenue growth guidance to 8.9%-9.3% from a prior 6.4%-8.4%, and above a 7.4% consensus. Credit Suisse has responded by upgrading to Outperform.
- IT outsourcing peers Cognizant (CTSH +5.3%), Accenture (ACN +2.6%), and Wipro (WIT +2.6%) have joined Infosys in outperforming. The Nasdaq is up 1.8%, and the S&P 1.6%.
- FQ3 details: Forex had a 4% impact on Infosys' FQ3 sales growth (8.5% vs. 12.5%). Gross margin fell to 37.2% from 38.7% a year ago. Operating expenses rose 11% Y/Y to $296M. Infosys ended FQ3 with $4.5B in cash, and no debt.
- CEO Vishal Sikka: "Alongside grassroots innovation, we continue to see growing adoption of our Aikido services, bringing the power of intelligent systems, automation and software to amplify the skills and imaginations of our people. This combination helped us deliver encouraging results despite the traditional seasonality of the quarter and the additional headwinds..."
- COO Pravin Rao: "The healthy volume growth this quarter has been encouraging. The lesser working days and our investments into additional trainees resulted in softer pricing and utilization for the quarter ... We continue to simplify our policies and enable greater agility within the company, with the goal of boosting our productivity."
- Infosys' FQ3 results, earnings release
Dec. 17, 2015, 11:51 AM
- Though Accenture (NYSE:ACN) beat FQ1 revenue estimates (while missing on EPS), it's guiding for FQ2 revenue of $7.5B-$7.75B, mostly below a $7.74B consensus.
- FY16 guidance: The consulting/outsourcing giant still expects FY16 (ends Aug. '16) EPS of $$5.09-$5.24 (consensus is at $5.21) and free cash flow of $3.6B-$3.9B. FY16 local currency revenue growth guidance has been upped to 6%-9% from 5%-8%, but with forex now expected to have a 5% revenue impact (up from 4%), dollar-based revenue growth guidance is still at 1%-4% (consensus is at 3.6%).
- Bookings: FQ1 new bookings were flat Y/Y at $7.7B (forex had an 8% impact). Consulting bookings rose by $500M to $4.4B; outsourcing bookings fell by $500M to $3.3B. Peers such as IBM and HP have also seen soft outsourcing demand; cloud adoption is generally considered a culprit.
- Segment performance: Telecom, media, and tech revenue +1% Y/Y to $1.6B. Financial services +2% to $1.75B. Health & public service +4% to $1.42B. Products +3% to $1.99B. Resources (hurt by weak oil prices) -4% to $1.25B.
- Regional performance: North America revenue +9% to $3.76B. Europe -1% to $2.88B (+12% exc. forex). Growth markets -12% to $1.36B (+6% exc. forx).
- Financials: $658M was spent to buy back 6.5M shares. Gross margin fell 20 bps Y/Y to 32%, but spending controls allowed op. margin to rise 20 bps to 15.2%. GAAP costs/expenses rose by less than $100M Y/Y to $7.24B. Accenture ended FQ1 with $3.1B in cash, and almost no debt.
- Expectations were relatively high: Shares went into earnings less than a dollar away from a high of $109.86.
- Accenture's FQ1 results, earnings release
Sep. 24, 2015, 8:28 AM
- Accenture (NYSE:ACN) -4.4% premarket despite beating FQ4 earnings and revenue expectations, as it guides its Q1 revenue outlook below Wall Street estimates.
- ACN foresees FQ1 revenues of $7.70B-$7.95B vs. $8.12B analyst consensus estimate, due mainly to a stronger dollar; for FY 2016, ACN sees EPS of $5.09-$5.24 vs. $5.22 consensus, and revenues up 1%-4% (up 5%-8% in local currency) to $31.3B-$32.3B vs. $32.6B consensus.
- For FQ4, revenue before reimbursements rose 1.4% to a better than expected $7.89B, but excluding currency impacts, revenue would have grown 12%.
- FQ4 consulting business revenue rose 14% Y/Y in local currency terms, and revenue in the outsourcing business gained 9%; consulting accounts for slightly more than half of ACN's total revenue, while outsourcing contributes the rest.
- ACN's board also approves $5B in additional share repurchase authority.
- Also: Accenture declares $1.10 dividend
Sep. 8, 2015, 3:52 PM
- Accenture (ACN +2.8%) is buying S3 Technology, a provider of consulting, testing, service monitoring, and diagnostic services for pay-TV providers. Terms are undisclosed.
- Accenture plans to integrate S3's offerings with its Digital Video Services unit, and its Video Solution software. The company states the deal will help it provide clients with solutions that pair traditional linear TV broadcasts with "non-linear services such as catch-up TV and video on demand."
- Separately, Argus has upgraded Accenture to Buy. The firm cites valuation, healthy top-line growth (when adjusted for forex), and growing margins/free cash flow. "Accenture’s breadth of services, its unmatched number of verticals served, and the reach of its global delivery network have enabled the company to establish 'unique relationships' with top-tier companies among its global 2,000 customer base."
- Shares are rallying on a day the S&P is up 2.4%.
- Recent Accenture acquisitions
Jun. 25, 2015, 9:38 AM
- With an FQ3 beat in tow, Accenture (NYSE:ACN) now forecasts FY15 (ends in August) adjusted EPS of $4.73-$4.78 vs. a prior $4.66-$4.76; consensus is at $4.74. FY15 constant currency revenue growth guidance has been hiked to 9%-10% from 8%-10%; consensus in U.S. dollars is 1.7%. Free cash flow guidance remains at $3.4B-$3.7B.
- Bookings: New consulting bookings rose by $200M Y/Y to $4.5B; new outsourcing bookings fell by $500M to $4B. Forex had a 10% impact on new bookings. Accenture still expects FY15 new bookings of $33B-$35B.
- Geographic performance: North American revenue +11% Y/Y to $3.6B. Europe -10% to $2.7B (+7% exc. forex). Growth markets -2% to $1.5B (+13% exc. forex).
- Segment performance: Telecom/media/tech revenue +8% to $4.7B. Financial services +2% to $4.9B. Health/public service +9% to $4.1B. Products +4% to $5.6B. Resources -2% to $3.8B.
- Financials: $518M was spent on buybacks (lifted EPS). Gross margin fell 30 bps Y/Y to 32.5%. Op. margin rose 20 bps to 15.4%, thanks to SG&A falling to 17.1% of revenue from 17.5%. Accenture ended FQ3 with $4B in cash, and $27M in debt.
- Shares have made new highs. They're up 13% YTD.
- FQ3 results, PR
Mar. 26, 2015, 1:35 PM
- In addition to beating FQ2 estimates, Accenture (NYSE:ACN) has hiked its FY15 (ends Aug. '15) local currency revenue growth guidance to 8%-10% from 5%-8%. However, forex is now expected to have an 800 bps impact on FY15 revenue growth, up from a prior 500 bps.
- Due to the forex hit (widely expected), FY15 EPS guidance has been cut to $4.61-$4.71 from $4.66-$4.80 (consensus is at $4.75). Likewise, FQ1 revenue guidance of $7.35B-$7.6B (assumes an 1100 bps forex hit) is below a $7.63B consensus.
- New consulting bookings fell by $400M Y/Y in FQ2 to $4.2B, and new outsourcing bookings by $400M to $5.1B. Forex had a 600 bps impact on bookings growth.
- North American revenue was a strong point, rising 13% Y/Y to $3.41B. Europe fell 2% to $2.66B (700 bps forex hit), and "growth markets" rose 3% to $1.42B (900 bps forex hit). Telecom/media/tech revenue +8%; financial services +2%; health/public service +12%; products +6%; resources -1%.
- Hurting EPS: Gross margin fell to 29.9% from 31.3% a year ago. Boosting EPS: SG&A spend fell to 16.3% of revenue from 17.9%, and $601M was spent to buy back 6.8M shares. Free cash flow was $220M, below net income of $743M.
- Shares have surged to new highs.
- FQ2 results, PR
Dec. 18, 2014, 1:14 PM
- In addition to beating FQ1 estimates, Accenture (ACN +4.3%) has hiked its guidance for FY15 (ends Aug. '15) local currency revenue growth to 5%-8% from 4%-7%. On the other hand, forex is now expected to have 500 bps impact on revenue, up from a prior 200 bps.
- As a result, FY15 EPS guidance has been lowered to $4.66-$4.80 from $4.74-$4.88 - consensus is at $4.81 - and FQ2 revenue guidance of $7.25B-$7.5B is mostly below a $7.46B consensus. The market appears to have discounted forex pressures in advance.
- FQ1 new bookings totaled $7.7B, down from $8.7B a year ago. Consulting bookings fell to $3.9B from $4.3B, and outsourcing bookings to $3.8B from $4.4B.
- Gross margin fell 110 bps Y/Y to 32.2%, but cost controls helped SG&A spend fall to 17.1% of revenue from 18.7%. As a result, op. margin rose 20 bps to 15%. $670M was spent on buybacks.
- North America revenue +11% to $3.44B; Europe +5% to $2.91B; "Growth Markets" +3% to $1.55B. Forex respectively had 400 bps and 600 bps impacts on Europe and Growth Markets revenue growth.
- Accenture has made new highs. Outsourcing rivals Infosys (INFY +3%), Wipro (WIT +4.9%), and Cognizant (CTSH +4.3%) are also outperforming on a good day for equities.
- FQ1 results, PR
Sep. 30, 2014, 11:59 AM
- CLSA has launched coverage on IT outsourcing giants Accenture (ACN +2%) and Cognizant (CTSH +2%) with Outperform ratings.
- Accenture has been range-bound in 2014. Cognizant, meanwhile, hasn't yet recovered from the early-August nosedive it took after providing soft guidance provided with its Q2 EPS beat.
Aug. 6, 2014, 9:43 AM
- Though its Q2 revenue was in-line, Cognizant (NASDAQ:CTSH) expects Q3 revenue of $2.55B-$2.58B and EPS of $0.63+ vs. a consensus of $2.66B and $0.60. Full-year guidance is for 14%+ revenue growth and EPS of $2.54+ vs. a consensus for 16.9% growth and EPS of $2.38.
- The company blames its top-line softness on "weakness at certain clients and longer than anticipated sales cycles for certain large integrated deals." The IT outsourcing industry in general has been pressured by a growing customer preference for smaller deals, and (in certain segments) the adoption of cloud services.
- Gross margin fell 70 bps Y/Y to 40.4%, and SG&A spend rose 15% to $483M. Cognizant spent over $100M on buybacks, and has increased its buyback authorization by $500M; $900M remains available under the company's buyback program.
- Peers Infosys (INFY -4.2%), Wipro (WIT -2.5%), and Accenture (ACN -1.5%) are also trading lower. Infosys dropped last month after providing cautious remarks about near-term demand to go with an EPS beat.
- Q2 results, PR
Jun. 26, 2014, 12:35 PM
- Though Accenture (ACN -1%) beat FQ3 estimates, it now expects FY14 (ends Aug. '14) EPS to be in a range of $4.50-$4.54. That's at the low end of a prior $4.50-$4.62 range, and compares with a $4.53 consensus. FQ4 revenue guidance of $7.45B-$7.7B is in-line with a $7.56B consensus.
- New bookings totaled $8.8B in FQ3 - $4.3B consulting, $4.5B outsourcing - up from $8.3B a year ago and down from $10.1B in seasonally strong FQ2. FY14 new bookings are now expected to be at the high end of a prior $33B-$36B guidance range.
- Geographical performance: Americas sales +6% Y/Y vs. +2% in FQ2; EMEA +13% vs. +2%, Asia-Pac (hurt by forex) -1% vs. +7%.
- Segment performance: Telecom/media/tech +7% vs. flat; financial services +7% vs. +4%, health/public +10% vs. -1%; products +11% vs. +4%; resources +2% vs. -2%.
- Gross margin +150 bps Q/Q and -110 bps Y/Y to 32.8%. SG&A spend fell to 17.5% of revenue from 17.9% in FQ2 and 18.7% a year ago. $441M was spent to buy back 4.8M shares.
- FQ3 results, PR
Apr. 2, 2014, 5:38 PM
Mar. 27, 2014, 10:58 AM
- Accenture (ACN -5.6%) now expects FY14 (ends in August) local currency revenue growth of 3%-6% and (thanks to a lower tax rate) EPS of $4.50-$4.62, up from prior forecasts of 2%-6% and $4.44-$4.56. But the company has lowered its free cash flow guidance range by $300M to $2.9B-$3.2B.
- FY14 new bookings guidance has been raised by $1B to $33B-$36B. FQ3 revenue guidance is set at $7.4B-$7.65B, in-line with a $7.56B consensus.
- Consulting bookings rose by $200M Y/Y in FQ2 to $4.6B, and outsourcing bookings by $800M to $5.5B. Consulting revenue -1% Y/Y, even with FQ1. Outsourcing revenue +4% vs. +5%.
- Much like IBM, Cisco, and several other tech giants, Accenture continues to struggle in Asia-Pac: Sales fell 7% Y/Y (4% exc. forex) to $908M after dropping 6% in FQ1. Americas sales +2% to $3.36B, EMEA +2% to $2.8B.
- The health/public service vertical was a weak spot, with sales dropping 1% after rising 5% in FQ1. Financial services +4%, telecom/media/tech flat, products +4%, resources -2%.
- Gross margin -30 bps Y/Y to 31.3%. SG&A spend fell to 17.9% of revenue from 18.3% a year ago.
- $739M was spent on buybacks. Accenture still expects to spend $3.7B or more in FY14 on dividends and buybacks.
- FQ2 results, PR
Dec. 19, 2013, 10:06 AM
- Accenture (ACN +4.4%) is guiding for FQ2 revenue of $6.95-$7.25B, below a consensus of $7.28B. But the company is also reiterating guidance for 2%-6% FY14 (ends Aug. '14) local currency revenue growth, and (due to a smaller forex hit) slightly raising its FY14 EPS guidance range to $4.44-$4.56 from $4.42-$4.54 (consensus is at $4.47).
- New bookings totaled $8.7B in FQ1, up from $8.4B in FQ4 and a depressed $7.5B in the year-ago period. Consulting ($4.3B) and outsourcing ($4.4B) respectively made up 49% and 51% of bookings vs. 46% and 54% in FQ4.
- Opex rose 1% Y/Y, slightly less than rev. growth of 2%. Gross margin was 33.3%, +10 bps Q/Q and +50 bps Y/Y.
- Americas revenue +3% Y/Y vs. +8% in FQ4, EMEA +3% vs. +2%, Asia-Pac -6% vs. -7%. Plenty of other tech companies have also been struggling in Asia-Pac.
- Telecom/media/tech sales -3%, financial services +2%, health & public service +5%, products +6%, resources flat.
- $722M was spent on buybacks, down from $1.1B in FQ4. The company added $5B to its buyback plan in September.
- FQ1 results, PR
Dec. 4, 2013, 1:49 PM
- Citing the impact of faster-than-expected cloud computing adoption, Morgan Stanley's Katy Huberty has downgraded Accenture (ACN -1.9%) and NetApp (NTAP -0.9%) to Equal Weight. Meanwhile, citing more favorable risk/reward, Huberty has upgraded Western Digital (WDC +2.8%) to Overweight and Brocade (BRCD +0.5%) to Equal Weight.
- Concerns about the impact of cloud services on sales of IT outsourcing services such as Accenture's, and enterprise storage hardware such as NetApp's, have been around for some time. Recent numbers (I, II) provided by the companies, and by peers such as IBM and EMC, haven't done much to soothe those fears. Synergy Research recently estimated sales of cloud infrastructure (IaaS) and app platform (PaaS) services rose 46% Y/Y in Q3.
- Accenture now trades at 15x estimated FY14 (ends Aug. '14) EPS exc. net cash, and NetApp trades at just 10x estimated FY14 (ends April '14) EPS exc. net cash.
- Western Digital, whose hard drive sales have been pressured by PC weakness and SSD adoption, recently began shipping its first helium drives (they're lighter, denser, and more power-efficient than traditional drives), in part to better meet the needs of Web/cloud companies.
Oct. 11, 2013, 1:37 PM
- Infosys' (INFY +6.1%) FQ2 beat and in-line FY14 revenue guidance (9%-10% growth vs. 9.3% consensus) is providing a lift to IT outsourcing peers Cognizant (CTSH +5.4%), Wipro (WIT +4.2%), and Accenture (ACN +1.7%)
- Cognizant and Wipro have made new 52-week highs. In July, both companies rallied in response to Infosys' FQ1 beat. All four companies sold off last month after Cognizant provided soft revenue and bookings guidance (more the result of consulting weakness rather than outsourcing)
- Infosys' CC remarks could also be helping out the group. CEO S.D. Shibulal mentioned demand from financial services clients is picking up, retail/consumer products demand remains healthy, and European firms are showing greater interest in outsourcing across verticals. However, manufacturing spend is "relatively stagnant," and and the energy, utilities, and telecom verticals remain challenging.
- 15 cloud/big data-related deals were signed in FQ2. Cloud services represent both a growth opportunity for outsourcing firms, and (to the extent in-house projects are abandoned for public cloud services) a long-term threat.
- The rupee's decline boosted Infosys' EBIT margin by 250 bps, but wage hikes took a 300 bps toll.
Accenture Plc operates as an investment holding company with interest in providing management consulting, technology and outsourcing services. The company's business is structured around five operating groups, which together comprise nineteen industry groups serving clients in major industries... More
Industry: Management Services
Country: United States
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