Why IT Company Accenture's Shares Are Falling Today

Accenture PLC ACN shares are trading lower by around 5% after it reported Q4 FY23 results. 

The company reported Q4 revenue growth of 4% Y/Y to $15.98 billion, missing the consensus of $16.07 billion.

Consulting revenues decreased by 2% Y/Y to $8.20 billion, while Managed Services revenues increased by 10% Y/Y to $7.79 billion.

New bookings fell 10% Y/Y to $16.6 billion in the quarter. 

Adjusted operating margin was 14.9%, an expansion of 20 bps. The gross margin expanded by 30 bps to 32.4%.

Adjusted EPS of $2.71 beat the consensus of $2.66. 

Free cash flow was $3.23 billion, down from $3.61 billion a year ago. 

As of August 31, 2023, Accenture's total cash balance was $9.0 billion.

"Our ability to remain laser-focused on meeting the needs of our clients is reflected in new bookings of $72 billion in fiscal 2023; 106 clients with quarterly bookings of more than $100 million; and reaching a record 300 Diamond clients, our largest relationships. Our clients' generative AI bookings of $300 million in the last six months position us at the heart of the beginning of AI-fueled reinvention," said Julie Sweet, chair and CEO, Accenture. 

Related: Accenture's AI Vision: Invests In Generative AI Platform Writer

Dividend: Accenture raised the quarterly dividend per share by 15% to $1.29, payable on November 15, 2023, to shareholders of record as of October 12, 2023. 

Share Repurchase: Accenture repurchased or redeemed 3.2 million shares for $1.0 billion in Q4. The Board of Directors approved an additional share repurchase authority of $4.0 billion, bringing total outstanding shares to about $6.5 billion.

Q1 FY24 Outlook: Accenture expects revenues of $15.85 billion to $16.45 billion, vs. consensus of $16.43 billion.

FY24 Outlook: Accenture expects revenue growth of 2%-5% in local currency and adjusted EPS of $11.97-$12.32 vs. consensus of $12.46.

The company expects free cash flow of $8.7 billion to $9.3 billion and to return at least $7.7 billion through dividends and share repurchases to shareholders in FY24.

Also Read: Accenture Rides On Longer-Term AI Opportunity, Analyst Forecasts Steady Margin Expansion

Price Action: ACN shares are down 5.21% at $298.019 premarket on the last check Thursday.