Accenture (ACN) Fell on Investors’ Concerns Over Long-Term Impact of AI

Group 1: Market Overview - Global equity markets experienced significant growth in Q3 2025, with the MSCI ACWI Index increasing by 7.62% [1] - Global fixed income markets also saw an uptick, as evidenced by a 0.60% rise in the Bloomberg Global Aggregate Bond Index during the same period [1] Group 2: Fund Performance - The Aristotle International Equity Fund (Class I-2) reported a return of 1.15% for the quarter, underperforming compared to the MSCI ACWI ex USA Index, which returned 6.89%, and the MSCI EAFE Index, which returned 4.77% [1] Group 3: Accenture plc Analysis - Accenture plc (NYSE:ACN) was highlighted as a significant detractor in the investor letter, with a one-month return of 8.69% but a substantial 25.28% decline over the past 52 weeks [2][3] - The company's revenue from AI-related services nearly doubled to $5.9 billion in fiscal 2025, but concerns about the impact of AI on its outsourcing business have arisen, particularly due to its reliance on billable hours [3] - Federal contracts, which historically account for about 8% of Accenture's revenue, have been affected by the U.S. government's DOGE initiative, adding to the company's challenges [3] - Despite these issues, Accenture is investing in its workforce, employing approximately 77,000 AI and data specialists, and is returning capital to shareholders through a 10% year-over-year increase in dividends and a 15% increase in share buybacks [3] - The current valuation of Accenture shares is at a 10-year low, despite earnings per share and free cash flow being over 50% and 40% higher than mid-2020 levels, respectively [3]