Accenture (ACN) Q3 Earnings & Revenues Miss Estimates

Core Insights - Accenture plc reported lower-than-expected third-quarter fiscal 2024 results, with earnings of $3.1 per share and total revenues of $16.5 billion, both missing consensus estimates and showing year-over-year declines [1][2]. Revenue Details - Managed Services revenues were $8 billion, up 2% year-over-year but below the estimate of $8.2 billion. Consulting revenues were $8.5 billion, down 3% year-over-year but above the estimate of $8.3 billion [2]. - Health & Public Service revenues grew 8% year-over-year to $3.5 billion, exceeding the estimate of $3.4 billion. Resources segment revenues were flat at $2.3 billion, missing the expectation of $2.5 billion. Product segment revenues were $5 billion, flat in USD but up 2% in local currency, surpassing the estimate of $4.9 billion [2]. - Communications, Media & Technology revenues decreased 4% to $2.8 billion, meeting estimates. Financial Services revenues fell 8% to $2.9 billion, missing the estimate of $3.1 billion [3]. - Geographically, EMEA revenues were $5.8 billion, down 2% and meeting estimates. Growth Markets revenues were $2.9 billion, down 4% but up 8% in local currency, missing the estimate of $3 billion. North America revenues increased 1% to $7.8 billion, beating the estimate of $7.7 billion [3]. Booking Trends - Accenture reported new bookings of $21.1 billion, a 22% increase year-over-year, with consulting bookings at $9.3 billion and Managed Services bookings at $11.8 billion [4]. Operating Results - The gross margin for the quarter was 33.4%, unchanged from the previous year. Adjusted operating income was $2.7 billion, also flat year-over-year, while the adjusted operating margin increased by 10 basis points to 16.4% [5]. Balance Sheet & Cash Flow - At the end of the quarter, Accenture had cash and cash equivalents of $5.5 billion, up from $5.1 billion in the previous quarter. The company generated $1 billion in cash from operating activities and had capital expenditures of $14.3 million [6]. - Free cash flow was $1 billion, with $1.4 billion spent on repurchasing 4.3 million shares and $811 million paid out in dividends [6]. Guidance - For the fourth quarter of fiscal 2024, Accenture reduced its revenue guidance to a range of $16.05-$16.65 billion, with the midpoint below the consensus estimate [7]. - For fiscal 2024, the adjusted earnings per share guidance was lowered to $11.85-$12, with the midpoint also below the consensus estimate. The company expects an adjusted operating margin of 15.5% and operating cash flow of $9.3-$9.9 billion [8].