Accenture Stock Falls After Q3 Earnings - Here's Why

Accenture Plc ACN shares are trading lower Thursday after it reported third-quarter results.

 The company reported third-quarter FY23 revenue growth of 3% year-over-year to $16.57 billion, marginally beating the consensus of $16.56 billion.

New bookings increased by 2% Y/Y to $17.2 billion. Consulting revenues decreased by 4% Y/Y to $8.69 billion, and Managed Services revenues increased by 10% Y/Y to $7.87 billion.

Adjusted EPS of $3.19 beat the consensus of $3.04. Adjusted operating margin was 16.3%, an expansion of 20 bps. The gross margin expanded by 50 bps to 33.4%.

Free cash flow was $3.15 billion, up from $2.87 billion a year ago. Accenture's total cash balance was $8.5 billion.

Dividend: Accenture declared a quarterly cash dividend of $1.12 per share. 

Julie Sweet, chair and CEO of Accenture, said, "Our third quarter results reflect solid bookings and revenue and very strong adjusted operating margin, earnings per share, and free cash flow, which demonstrates the rigor and discipline with which we run our business."

4Q23 Outlook: Accenture expects revenues of $15.75 billion - $16.35 billion, vs. consensus of $16.35 billion.

FY23 Outlook: Accenture now expects revenue of $66.52 billion - $67.14 billion (prior $66.52 billion - $67.75 billion) vs consensus $64.41 billion.

The company now expects adjusted EPS of $11.52 - $11.63 (prior $11.41 - $11.63) vs consensus $11.63.

Price Action: ACN shares traded lower by 5.49% at $296.00 premarket on the last check Thursday.