IT services provider Accenture Limited reported its second-quarter results for fiscal year 2025, revealing that its revenue guidance fell short of investor expectations. The company slightly adjusted its revenue growth forecast, now anticipating annual revenue growth for FY25 to range between 5 percent and 7 percent, compared to its previous estimate of 4 percent to 7 percent.
Accenture is often seen as a benchmark for Indian IT companies, offering valuable insights into their potential performance. As a result, its results are closely watched as a broad indicator of the potential outcomes for India’s IT sector, which heavily relies on services exports for revenue.
For the quarter, Accenture’s new bookings decreased by 3 percent in US Dollar terms, although new bookings in the Generative AI sector totalled $1.4 billion. The company’s management also highlighted an elevated level of uncertainty, particularly within public services, due to the ongoing review and potential cuts in US government spending, driven by initiatives of the Elon Musk-led Department of Government Efficiency (DOGE).
Accenture’s CEO, Julie Sweet, noted during an earnings call that federal services represented about 8 percent of its global revenue and approximately 16 percent of its revenue from the Americas in FY24.
Below are a few Indian IT stocks that witnessed a decline in their share prices, following Accenture’s financial results:
- Tata Consultancy Services Limited (TCS): With a market cap of Rs. 13 lakh crores, the stock moved down by around 3 percent to hit an intraday low at Rs. 3,466.6 on BSE, during Friday’s trading session.
- HCL Technologies Limited : The shares of a leading global IT services company fell by nearly 2.5 percent to Rs. 1,521.2 on Friday, with a market cap of Rs. 4.27 lakh crores.
- Wipro Limited: During Friday’s trading session, the share price of a leading technology services and consulting company moved down by 3 percent to Rs. 260.3 on BSE, with a market cap of Rs. 2.79 lakh crores.
- Tech Mahindra Limited: With a market cap of Rs. 1.39 lakh crores, the stock slumped by about 2 percent to hit an intraday low at Rs. 1,381 on Friday, as against its previous closing price of Rs. 1,410.5.
- Infosys Limited: The stock reached an intraday low at Rs. 1,381 on BSE, down by nearly 2 percent on Friday, compared to its previous closing price of Rs. 1,410.5, with a market cap of Rs. 1.39 lakh crores.
IT Sector Performance:
IT stocks have struggled to keep pace with the recent market recovery, primarily due to concerns about a potential recession in the US, which is their key market.
The Nifty IT index has entered bear market territory, dropping more than 15 percent from its peak in December of the previous year. However, stocks saw a positive movement on Thursday following the US Federal Reserve’s decision to maintain its projection of two rate cuts for 2025.
Written by Shivani Singh
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