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ACN’s earnings (excluding 8 cents from non-recurring items) of $3.1 per share missed the Zacks Consensus Estimate marginally and decreased 1.9% from the year-ago quarter. Total revenues of $16.5 billion missed the consensus estimate by a slight margin and declined on a year-over-year basis.
Based on the type of work, Managed Services revenues of $8 billion increased 2% from the year-ago quarter on a reported basis and 4% in terms of local currency, missing our estimate of $8.2 billion. Consulting revenues declined 3% year over year on a reported basis and 1% in terms of local currency to $8.5 billion, beating our estimate of $8.3 billion.
Segment-wise, Health & Public Service revenues of $3.5 billion grew 8% from the year-ago quarter on a reported basis and 9% in terms of local currency. The figure outpaced our estimate of $3.4 billion. Revenues from the resources segment amounted to $2.3 billion, flat on a reported basis and rising 3% on a local currency basis. It missed our expectation of $2.5 billion. Revenues from the product segment amounted to $5 billion, flat in terms of U.S. dollars and growing 2% on a local currency basis. This figure outpaced out estimated $4.9 billion.
Communications, Media & Technology revenues of $2.8 billion decreased 4% on a reported basis and 1% in terms of local currency, meeting our estimate. Financial Services revenues of $2.9 billion decreased 8% from the year-ago quarter’s reading on a reported basis and 5% in terms of local currency. It missed our estimate of $3.1 billion.
Geographically, revenues of $5.8 billion from the EMEA declined 2% in both reported and local currency basis, meeting our estimate. Revenues of $2.9 billion from Growth Markets decreased 4% year over year on a reported basis but gained 8% in terms of local currency, missing our estimate of $3 billion. Revenues of $7.8 billion from North America increased 1% from the year-ago quarter on a reported and local currency basis. The figure beat our anticipation of $7.7 billion.
Booking Trends
Accenture reported new bookings worth $21.1 billion in third-quarter fiscal 2024, rising 22% from the year-ago quarter on a reported basis and 26% in terms of local currency. Consulting bookings totaled $9.3 billion and Managed Services bookings amounted to $11.8 billion.
Operating Results
The gross margin (gross profit as a percentage of net revenues) for third-quarter fiscal 2024 was 33.4%, flat with the year-ago quarter. Adjusted operating income was $2.7 billion, flat on a year-over-year basis. The adjusted operating margin of 16.4% increased 10 basis points from third-quarter fiscal 2023.
Balance Sheet & Cash Flow
Accenture exited third-quarter fiscal 2024 with cash and cash equivalents of $5.5 billion compared with $5.1 billion at the end of second-quarter fiscal 2024. ACN generated $1 billion in cash from operating activities. Capital expenditure in the reported quarter was $14.3 million.
The free cash flow was $1 billion. Accenture repurchased 4.3 million shares for $1.4 billion, including 4.1 million shares repurchased in the open market. The company paid out a dividend of $811 million in the third quarter of fiscal 2024.
Q4 & 2024 Guidance
For fourth-quarter fiscal 2024, the company reduced its revenue guidance to $16.05-$16.65 billion compared with the $16.25-$16.85 billion mentioned previously. The mid-point ($16.35 billion) of the revised guided range is below the Zacks Consensus Estimate of $16.52 billion.
For fiscal 2024, Accenture has reduced its guidance for adjusted earnings per share to $11.85-$12 compared with $11.97-$12.2 mentioned previously. The mid-point ($11.93) of the revised guided range is lower than the Zacks Consensus Estimate of $12.06. Accenture expects its adjusted operating margin for the fiscal year to be 15.5%. The operating cash flow is anticipated to be $9.3-$9.9 billion. The free cash flow is expected between $8.7 billion and $9.3 billion.
Currently, Accenture carries a Zacks Rank #4 (Sell).
The Interpublic Group of Companies, Inc. (IPG - Free Report) reported mixed first-quarter 2024 results.
IPG’s adjusted earnings (excluding 7 cents from non-recurring items) of 36 cents per share met the Zacks Consensus Estimate but decreased 5.3% on a year-over-year basis. Revenues before billable expenses (net revenues) of $2.2 billion surpassed the consensus estimate marginally but decreased 13.4% year over year. Total revenues of $2.5 billion declined 1% and met our estimate.
EFX’s adjusted earnings (excluding 50 cents from non-recurring items) were $1.5 per share, beating the Zacks Consensus Estimate by 4.2% and increasing 4.9% from the year-ago quarter. Total revenues of $1.4 billion missed the consensus estimate by a slight margin but increased 6.7% from the year-ago quarter.
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Accenture (ACN) Q3 Earnings & Revenues Miss Estimates
Accenture plc (ACN - Free Report) has reported lower-than-expected third-quarter fiscal 2024 results.
ACN’s earnings (excluding 8 cents from non-recurring items) of $3.1 per share missed the Zacks Consensus Estimate marginally and decreased 1.9% from the year-ago quarter. Total revenues of $16.5 billion missed the consensus estimate by a slight margin and declined on a year-over-year basis.
Accenture PLC Price and EPS Surprise
Accenture PLC price-eps-surprise | Accenture PLC Quote
Revenues in Detail
Based on the type of work, Managed Services revenues of $8 billion increased 2% from the year-ago quarter on a reported basis and 4% in terms of local currency, missing our estimate of $8.2 billion. Consulting revenues declined 3% year over year on a reported basis and 1% in terms of local currency to $8.5 billion, beating our estimate of $8.3 billion.
Segment-wise, Health & Public Service revenues of $3.5 billion grew 8% from the year-ago quarter on a reported basis and 9% in terms of local currency. The figure outpaced our estimate of $3.4 billion. Revenues from the resources segment amounted to $2.3 billion, flat on a reported basis and rising 3% on a local currency basis. It missed our expectation of $2.5 billion. Revenues from the product segment amounted to $5 billion, flat in terms of U.S. dollars and growing 2% on a local currency basis. This figure outpaced out estimated $4.9 billion.
Communications, Media & Technology revenues of $2.8 billion decreased 4% on a reported basis and 1% in terms of local currency, meeting our estimate. Financial Services revenues of $2.9 billion decreased 8% from the year-ago quarter’s reading on a reported basis and 5% in terms of local currency. It missed our estimate of $3.1 billion.
Geographically, revenues of $5.8 billion from the EMEA declined 2% in both reported and local currency basis, meeting our estimate. Revenues of $2.9 billion from Growth Markets decreased 4% year over year on a reported basis but gained 8% in terms of local currency, missing our estimate of $3 billion. Revenues of $7.8 billion from North America increased 1% from the year-ago quarter on a reported and local currency basis. The figure beat our anticipation of $7.7 billion.
Booking Trends
Accenture reported new bookings worth $21.1 billion in third-quarter fiscal 2024, rising 22% from the year-ago quarter on a reported basis and 26% in terms of local currency. Consulting bookings totaled $9.3 billion and Managed Services bookings amounted to $11.8 billion.
Operating Results
The gross margin (gross profit as a percentage of net revenues) for third-quarter fiscal 2024 was 33.4%, flat with the year-ago quarter. Adjusted operating income was $2.7 billion, flat on a year-over-year basis. The adjusted operating margin of 16.4% increased 10 basis points from third-quarter fiscal 2023.
Balance Sheet & Cash Flow
Accenture exited third-quarter fiscal 2024 with cash and cash equivalents of $5.5 billion compared with $5.1 billion at the end of second-quarter fiscal 2024. ACN generated $1 billion in cash from operating activities. Capital expenditure in the reported quarter was $14.3 million.
The free cash flow was $1 billion. Accenture repurchased 4.3 million shares for $1.4 billion, including 4.1 million shares repurchased in the open market. The company paid out a dividend of $811 million in the third quarter of fiscal 2024.
Q4 & 2024 Guidance
For fourth-quarter fiscal 2024, the company reduced its revenue guidance to $16.05-$16.65 billion compared with the $16.25-$16.85 billion mentioned previously. The mid-point ($16.35 billion) of the revised guided range is below the Zacks Consensus Estimate of $16.52 billion.
For fiscal 2024, Accenture has reduced its guidance for adjusted earnings per share to $11.85-$12 compared with $11.97-$12.2 mentioned previously. The mid-point ($11.93) of the revised guided range is lower than the Zacks Consensus Estimate of $12.06. Accenture expects its adjusted operating margin for the fiscal year to be 15.5%. The operating cash flow is anticipated to be $9.3-$9.9 billion. The free cash flow is expected between $8.7 billion and $9.3 billion.
Currently, Accenture carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Snapshot of Peers
The Interpublic Group of Companies, Inc. (IPG - Free Report) reported mixed first-quarter 2024 results.
IPG’s adjusted earnings (excluding 7 cents from non-recurring items) of 36 cents per share met the Zacks Consensus Estimate but decreased 5.3% on a year-over-year basis. Revenues before billable expenses (net revenues) of $2.2 billion surpassed the consensus estimate marginally but decreased 13.4% year over year. Total revenues of $2.5 billion declined 1% and met our estimate.
Equifax Inc. (EFX - Free Report) reported mixed first-quarter 2024 results.
EFX’s adjusted earnings (excluding 50 cents from non-recurring items) were $1.5 per share, beating the Zacks Consensus Estimate by 4.2% and increasing 4.9% from the year-ago quarter. Total revenues of $1.4 billion missed the consensus estimate by a slight margin but increased 6.7% from the year-ago quarter.