Financial Data and Key Metrics Changes - Revenue for Q3 FY2025 was $17.7 billion, reflecting a 7% growth in local currency and exceeding the guided range [5][10][12] - Operating margin expanded by 40 basis points to 16.8% compared to adjusted results from the previous year [10][18] - Diluted earnings per share (EPS) grew by 12% to $3.49 compared to adjusted EPS of $3.13 in Q3 FY2024 [10][18] - Free cash flow for the quarter was $3.5 billion, with a cash balance of $9.6 billion at the end of the quarter [19] Business Line Data and Key Metrics Changes - Consulting revenues were $9 billion, up 7% in U.S. dollars and 6% in local currency [13] - Managed services revenues reached $8.7 billion, reflecting a 9% increase in both U.S. dollars and local currency, driven by double-digit growth in technology managed services [14] - New bookings totaled $19.7 billion for the quarter, with consulting bookings at $9.1 billion and managed services bookings at $10.6 billion [11][12] Market Data and Key Metrics Changes - Revenue growth in The Americas was 9% in local currency, led by banking and capital markets, industrial, and health sectors [14][15] - EMEA region saw a 6% growth in local currency, driven by life sciences, banking, and insurance [15] - Asia Pacific revenue grew by 4% in local currency, with growth in public service and banking, partially offset by declines in chemicals and natural resources [15] Company Strategy and Development Direction - The company aims to be the preferred partner for client reinvention, focusing on GenAI as a key driver for transformation [5][22] - A new integrated business unit called Reinvention Services will be established to enhance service delivery and embed data and AI into solutions [36][75] - The company is committed to investing in talent and capabilities, with significant training hours and strategic acquisitions to support growth [6][7] Management's Comments on Operating Environment and Future Outlook - Management noted heightened uncertainty in the global economic and geopolitical environment, impacting client interactions and spending [21][22] - The focus remains on helping clients navigate challenges and drive reinvention, with GenAI being a critical tool for achieving better results [22][23] - The outlook for Q4 FY2025 anticipates revenues between $17 billion and $17.6 billion, with a growth expectation of 1% to 5% in local currency [37][39] Other Important Information - The company has invested over $297 million in four strategic acquisitions and increased its workforce in data and AI to approximately 75,000 [6][7] - The brand value increased by 27% to $103.8 billion, reflecting strong market recognition [7] - The company plans to return at least $8.3 billion to shareholders through dividends and share repurchases [41] Q&A Session Summary Question: Talent retention and leadership changes - Management noted a slight increase in attrition but emphasized that it remains within normal ranges and that leadership changes are common as leaders pursue new opportunities [43][44] Question: Impact of heightened uncertainty on revenue generation - Management highlighted the resilience of their model, noting that clients are focusing on significant projects despite economic challenges [45][48] Question: GenAI demand and acquisition pace - Demand for GenAI remains strong, though growth has slightly slowed. The acquisition strategy is consistent, targeting about 2% inorganic contribution annually [53][55][62] Question: Changes in acquisition strategy and focus - The acquisition strategy remains aligned with business needs, focusing on building capabilities internally when necessary [61][62] Question: Federal contracting impact on bookings - Federal contracting had an immaterial impact on bookings, with Q4 headwinds arising from both slower procurements and cancellations [89][90]

Financial Data and Key Metrics Changes - Revenue for the quarter was $16.7 billion, reflecting an 8.5% growth in local currency and a 5% increase in U.S. dollars [20][24] - Operating margin was 13.5%, a decrease of 20 basis points compared to the adjusted operating margin from the previous year [21][29] - Diluted earnings per share (EPS) were $2.82, representing a 2% growth over adjusted EPS from the same quarter last year [21][29] - Free cash flow for the quarter was $2.7 billion, with a cash balance of $8.5 billion at the end of the quarter [30][31] Business Line Data and Key Metrics Changes - Consulting revenues were $8.3 billion, up 3% in U.S. dollars and 6% in local currency [24] - Managed Services revenue was $8.4 billion, up 8% in U.S. dollars and 11% in local currency, driven by double-digit growth in technology managed services [24] - New bookings totaled $20.9 billion, with consulting bookings at $10.5 billion and managed services bookings at $10.4 billion [23] Market Data and Key Metrics Changes - In the Americas, revenues grew 11% in local currency, led by banking and capital markets, industrial, health, and consumer goods [26] - EMEA revenues grew 8% in local currency, driven by public service, life sciences, and consumer goods [26] - Asia-Pacific revenue grew 1% in local currency, with growth in insurance and utilities, partially offset by declines in chemicals and natural resources [27] Company Strategy and Development Direction - The company continues to focus on large-scale transformations and has positioned itself as a partner of choice for clients, particularly in Gen AI, with $1.4 billion in new bookings [10][11] - Significant investments were made in strategic areas, including over $250 million across six acquisitions and approximately 15 million training hours for employees [11][12] - The company aims to increase its data and AI workforce to approximately 80,000 by the end of FY 2026 [11] Management's Comments on Operating Environment and Future Outlook - Management noted an elevated level of uncertainty in the global economic and geopolitical environment but remains confident in the fundamentals of the industry [16][17] - The company anticipates ongoing uncertainty in its federal business due to new procurement actions slowing down [15][16] - For the third quarter of fiscal '25, the company expects revenues in the range of $16.9 billion to $17.5 billion, reflecting an estimated 3% to 7% growth in local currency [58] Other Important Information - The company has been recognized as one of the World's Most Ethical Companies for the 18th consecutive year and ranked number one in its industry [13] - The company plans to return at least $8.3 billion through dividends and share repurchases [61] Q&A Session Summary Question: Are clients hitting the pause button on new initiatives? - Management indicated that there has been no overall change in client activity, with some discussions focusing on accelerating cost discussions [66][68] Question: What was the growth rate in U.S. Federal revenue? - Management did not provide specific growth rates for U.S. Federal revenue but emphasized that the overall guidance reflects potential impacts from federal procurement actions [70][72] Question: What is the margin outlook and cost of execution? - Management noted a decrease in gross margins due to higher subcontractor costs and business optimization actions, but expects a 10 to 20 basis point expansion in operating margin for the year [78][80] Question: How are budgets set and how have conversations changed? - Management observed that there was no meaningful increase in budgets for services, with discretionary spending remaining constrained [90][93] Question: How is the company managing its workforce mix? - Management stated that the mix of subcontractors can fluctuate based on client work, with a focus on maintaining a utilization rate of 91% [125]