Last Updated: March 24, 2023, 09:00 IST
The firm is altering its forecasts amid IT slowdown
Accenture Plc lowered its annual income and revenue forecasts and determined to chop about 2.5% of its workforce, or 19,000 jobs, the most recent signal that the worsening world financial outlook was sapping company spending on IT companies.
(Reuters) -Accenture Plc lowered its annual income and revenue forecasts and determined to chop about 2.5% of its workforce, or 19,000 jobs, the most recent signal that the worsening world financial outlook was sapping company spending on IT companies.
More than half of the roles to be reduce shall be in its non-billable company features, Accenture mentioned on Thursday, sending its shares up 6.4%.
Since late final yr, the tech sector has laid off a whole lot of 1000’s workers as a result of a requirement downturn brought on by excessive inflation and rising rates of interest.
Rival Cognizant Technology Solutions final month pointed to “muted” progress in bookings, or the offers IT companies corporations have within the pipeline, in 2022 and forecast quarterly income under expectations.
IBM Corp and India’s prime IT companies agency Tata Consultancy Services have additionally flagged weak spot in Europe, the place the Ukraine battle has affected shopper spending.
Accenture now expects annual income progress to be between 8% and 10%, in contrast with its earlier projection of a 8% to 11% improve.
Earnings per share is anticipated within the vary of $10.84 to $11.06 in contrast with $11.20 to $11.52 beforehand. The firm expects to incur $1.2 billion in severance prices by fiscal 2023 and 2024.
“Companies remain focused on executing compressed transformations,” Chief Executive Julie Sweet mentioned in a post-earnings name referring to how companies had been attempting to develop into leaner within the turbulent economic system.
A survey of greater than 1,000 IT choice makers by U.S.-based Enterprise Technology Research mentioned they plan to cut back their 2023 funds progress. The progress expectations at the moment are 3.4%, down from 5.6% improve captured in October 2022.
“In short, the data indicates a very difficult environment ahead for consulting firms,” mentioned Erik Bradley, chief engagement strategist on the expertise market analysis agency.
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(This story has been edited by News18 workers and is printed from a syndicated news company feed)
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