Core Insights - Accenture is restructuring its workforce to adapt to the AI era, involving both layoffs and new hiring initiatives [1][2] - The company aims to upskill its employees while also exiting those who cannot be retrained for necessary AI skills [2] - Despite workforce reductions, Accenture anticipates an overall increase in headcount across all markets in the next fiscal year [2] Financial Performance - Accenture reported $69.7 billion in revenue for fiscal 2025, reflecting a 7% increase from the previous year [8] - The company incurred approximately $615 million in restructuring charges in the latest quarter, primarily for severance, with expectations for this figure to rise to about $865 million [3][4] Talent Strategy - Accenture is focusing on "rapid talent rotation," which involves reducing employees whose skills do not align with new demands while expanding in areas such as data, cloud, and AI consulting [9] - The firm has nearly doubled its AI and data specialists to 77,000 since fiscal 2023 and has trained over 550,000 employees in generative AI fundamentals [4] Industry Context - The strategy employed by Accenture mirrors trends in the broader tech industry, where companies like Microsoft and Meta are also adjusting their workforce by laying off employees while hiring in priority areas [9][10]

Economic Data and Federal Reserve Outlook - Recent economic data has created uncertainty regarding the Federal Reserve's future interest rate cuts, with initial jobless claims dropping by 14,000 to a seasonally adjusted 218,000 for the week ended September 20 [10][11] - The U.S. economy grew faster than previously estimated in the second quarter, driven by strong consumer spending and business investment [10][11] - Investor expectations for another 25 basis points cut in the Fed's October meeting have decreased to 83.4%, down from approximately 92% [10][11] Market Performance - Most S&P 500 sectors ended lower, with energy gaining 0.9% and technology increasing by 0.03%, largely due to Intel's shares rising by 8.9% [5][11] - The Dow Jones Industrial Average fell by 173.96 points (0.38%) to 45,947.32, the S&P 500 lost 33.25 points (0.50%) to 6,604.72, and the Nasdaq Composite decreased by 113.16 points (0.50%) to 22,384.70 [6][11] - CarMax shares dropped by 20.1% following a report of lower second-quarter profit, while Accenture shares fell by 2.7% despite reporting revenue above expectations [6][11] Investor Sentiment and Future Expectations - Investors are keenly awaiting upcoming quarterly results from companies, particularly as market valuations are considered high after recent record highs [7][11] - There is a mixed sentiment among monetary policymakers regarding the direction of interest rates, with some advocating for accelerated policy easing [8][11] - The upcoming monthly U.S. jobs report is anticipated to be significant for market direction [7][11]

LOGIN SUBSCRIBE | FastCo Works advertisement BYÂ Reuters Listen to this ArticleMore info 0:00 / 0:00 Accenture beat fourth-quarter revenue estimates and unveiled a sixmonth, $865 million restructuring to realign its workforce and operations for rising demand in digital and AI services. The restructuring program highlights the broader trend of companies adapting their workforce and operations to meet growing demand for digital and AI services, while using restructuring to cut costs and funnel savings into tr ...

Market Overview - U.S. stocks experienced a decline, with the Nasdaq Composite falling over 1% on Thursday, while the Dow decreased by 0.64% to 45,824.16 and the S&P 500 dropped 1% to 6,571.28 [1] - Energy shares increased by 0.5%, while health care stocks fell by 1.4% on the same day [1] Company Performance - Accenture (NYSE: ACN) reported better-than-expected fourth-quarter 2025 results, with earnings of $3.03 per share, surpassing the analyst consensus estimate of $2.96, and sales of $17.60 billion, slightly exceeding the estimate of $17.36 billion [2] Commodity Market - Oil prices decreased by 0.2% to $64.88, while gold also fell by 0.2% to $3,761.50. Silver prices rose by 1.2% to $44.725, and copper prices dropped by 1% to $4.7660 [5] European Market - European shares were lower, with the eurozone's STOXX 600 falling by 0.52%, Spain's IBEX 35 Index down by 0.18%, London's FTSE 100 down by 0.24%, Germany's DAX 40 dipping by 0.62%, and France's CAC 40 falling by 0.46% [6] Asian Market - Asian markets closed mostly lower, with Japan's Nikkei 225 gaining 0.27%, while Hong Kong's Hang Seng declined by 0.13%, China's Shanghai Composite fell by 0.01%, and India's BSE Sensex decreased by 0.68% [7] Notable Stock Movements - PepGen Inc. (NASDAQ: PEPG) shares surged by 89% to $5.03 following the announcement of a $100 million public offering at $3.20 per share [8] - SciSparc Ltd. (NASDAQ: SPRC) shares increased by 101% to $7.71 after announcing a quantum computing-enabled 3D protein modeling initiative [8] - Plus Therapeutics, Inc. (NASDAQ: PSTV) shares rose by 30% to $0.5264 after securing a national coverage agreement with UnitedHealthcare [8] - Stitch Fix, Inc. (NASDAQ: SFIX) shares dropped by 14% to $4.88 after releasing fourth-quarter results [8] - CarMax, Inc. (NYSE: KMX) shares fell by 23% to $43.86 after reporting second-quarter EPS and sales below estimates [8] - Cemtrex, Inc. (NASDAQ: CETX) shares decreased by 31% to $0.4359 following a 1-for-15 reverse stock split approval [8] Economic Indicators - U.S. wholesale inventories declined by 0.2% month-over-month to $898.8 billion in August, contrary to market expectations of a 0.1% increase [11] - U.S. durable goods orders rose by 2.9% month-over-month to $312.1 billion in August, compared to a revised 2.7% decline in July [11] - The U.S. trade deficit in goods decreased by $17.3 billion month-over-month to $85.5 billion in August, better than market estimates [11] - Initial jobless claims fell by 14,000 to 218,000 in the third week of September, below market expectations [11] - The U.S. economy grew at an annualized rate of 3.8% in the second quarter, an increase from the previous estimate of 3.3% [11]

Core Insights - The introduction of a $100,000 H-1B application fee by President Trump poses significant challenges for consulting firms in talent acquisition, similar to those faced by tech companies [1][7] - Nearly 50% of H-1B applications are linked to professional, scientific, and technical services, highlighting the reliance of consulting firms on foreign skilled workers [2] - The H-1B program has been a crucial source of mid-level consultants with specialized skills, which are hard to find in the domestic market [4] Industry Impact - Consulting firms like Deloitte, EY, and Accenture are among the largest employers of H-1B visa holders, with Deloitte hiring 7,535 workers in the last three years, representing about 1% of its US workforce [5] - Accenture and EY have also significantly relied on H-1B visa holders, with 5,862 and 5,298 hires respectively, accounting for nearly 10% of their US headcounts [5] - The new application fee is expected to increase competition for talent and may lead to accelerated offshoring strategies among consulting firms [7] Strategic Responses - Consulting leaders express concern that the increased costs associated with H-1B visas will add friction to an already competitive talent market [4][6] - Major firms are anticipated to absorb some of the higher visa costs while adjusting their staffing models to maintain continuity [6] - Smaller consulting firms will need to enhance their ability to attract domestic talent, particularly for mid-level positions, to cope with the changes [6]

Core Viewpoint - Accenture's stock declined following the release of its fourth-quarter 2025 results, despite exceeding earnings and sales expectations [1][5]. Financial Performance - Quarterly earnings were reported at $3.03 per share, surpassing the analyst consensus estimate of $2.96 [1]. - Sales reached $17.60 billion, slightly above the analyst consensus estimate of $17.36 billion [1]. - Sales increased by 7% in U.S. dollars and 4.5% in local currency [2]. - Consulting revenues were $8.77 billion, a 6% increase in U.S. dollars and 3% in local currency [2]. - Managed Services revenues were $8.82 billion, an 8% increase in U.S. dollars and 6% in local currency [2]. - Products revenues reached $5.38 billion, up 9% in U.S. dollars and 5% in local currency [3]. - Health & Public Service revenues decreased by 1% in U.S. dollars and 3% in local currency to $3.56 billion [3]. - Financial Services revenue was $3.32 billion, up 15% in U.S. dollars and 12% in local currency [3]. - Resources revenue was $2.39 billion, up 8% in U.S. dollars and 5% in local currency [3]. - Communications, Media & Technology revenue was $2.95 billion, up 7% in U.S. dollars and 5% in local currency [3]. New Bookings and Margins - New bookings for the quarter totaled $21.31 billion, a 6% increase in U.S. dollars and 3% in local currency [4]. - Generative AI new bookings reached $1.8 billion in the quarter [4]. - Operating margin was reported at 11.6%, a decrease of 270 basis points, while adjusted operating margin increased by 10 basis points to 15.1% [4]. Cash Flow and Dividends - The company held $11.5 billion in cash and equivalents as of August 31 and generated $3.81 in free cash flow during the quarter [5]. - Accenture increased its quarterly dividend by 10% to $1.63 per share, payable on November 14, 2025 [6]. Outlook - For fiscal 2026, Accenture projected sales between $71.07 billion and $73.16 billion, exceeding the $69.43 billion consensus estimate [7]. - Expected GAAP EPS for fiscal 2026 is between $13.19 and $13.57, compared to the $12.88 analyst consensus [7]. - The company anticipates fiscal adjusted EPS of $13.52 to $13.90 [7]. - First-quarter sales are projected to be between $18.10 billion and $18.75 billion, against an $18.451 billion analyst estimate [7].

Core Insights - Accenture Plc reported stronger-than-expected fourth-quarter results, indicating resilience amid investor concerns regarding federal spending cuts and a broader slowdown in the consulting sector [1] Company Performance - The fourth-quarter results exceeded market expectations, showcasing the company's ability to navigate challenging economic conditions [1] Industry Context - The consulting sector is experiencing a slowdown, yet Accenture's performance suggests it is managing to maintain stability despite these industry-wide challenges [1]

Core Insights - Accenture reported higher fourth-quarter sales, reaching $17.6 billion, a 7% increase from the previous year, surpassing Wall Street's expectation of $17.38 billion [3] - The company experienced a net income of $2.25 per share, a 15% decline year-over-year, while adjusted earnings rose by 9% to $3.03, exceeding analyst expectations of $2.98 [2][3] - Concerns regarding federal government cuts impacting revenue may be overstated, as the government accounts for only 8% of Accenture's revenue [4] Financial Performance - Accenture's fourth-quarter sales were $17.6 billion, up 7% from the previous year [3] - New bookings for the quarter totaled $21.3 billion [3] - The company guided for 2026 revenue growth of 2% to 5%, with adjusted earnings projected between $13.52 and $13.90 per share [6] Market Sentiment - Accenture's shares have declined by 32% this year, primarily due to investor concerns about the impact of federal government cuts on consulting revenue [3] - Analysts from Stifel noted that fears regarding AI potentially harming Accenture's business could be misplaced, as technological changes often lead to increased revenue for service providers with relevant skills [4] Generative AI - Accenture reported generative AI bookings of $1.8 billion for the quarter, indicating a growing focus on this area [5]

Core Viewpoint - Accenture plc is recognized as a leading AI stock, with a maintained Outperform rating despite a slight reduction in the price target to $285.00 from $290.00, reflecting confidence in its digital franchise and growth potential in AI and cloud services [1][3]. Group 1: Company Performance and Outlook - Wolfe Research analyst Darrin Peller believes Accenture has a "best-in-class" digital franchise, supported by its cloud, security, and industry-focused offerings [1]. - The company's end-to-end capabilities and consulting expertise are expected to drive market share gains as enterprises increasingly adopt generative AI [2][3]. - Accenture's price target for year-end 2026 is set at $285, based on approximately 19 times the estimated earnings per share (EPS) of $15.03 for calendar year 2027 [3]. Group 2: Investment Drivers - Accenture's investments in AI and cloud services are anticipated to align with the growing demand for digital transformations, positioning the company favorably in the market [1][3]. - The firm expects improving discretionary demand in 2026 could lead to upside potential against consensus estimates [3]. - Accenture's strong consulting presence and unique domain expertise are seen as key factors for gaining market share in the generative AI space [2][3]. Group 3: Risks and Challenges - Despite the positive outlook, there are risks associated with tariffs and implications related to DOGE that could impact performance [2][3].

Group 1 - Accenture plc is a global professional services company based in Dublin, specializing in consulting, technology, and outsourcing services, with a price target of $315 set by UBS, indicating a potential increase of 32.43% from its current price of $237.87 [1][6] - The company is expected to release its fourth-quarter earnings on September 25, with analysts forecasting earnings of $2.96 per share and revenue of $17.35 billion, reflecting strong performance and strategic initiatives [2][6] - Accenture's planned acquisition of the French advisory firm Orlade Group aims to enhance its management capabilities for large capital projects, strengthening its position in sectors like nuclear energy, transportation, defense, and space [3][6] Group 2 - Recently, Accenture's stock price saw a slight increase, closing at $239.99, with a market capitalization of approximately $148.24 billion [4] - The trading volume for Accenture on the NYSE is 1,128,211 shares, indicating investor interest possibly driven by the upcoming earnings report and strategic acquisitions [5]