Accenture has reported stronger-than-expected fourth-quarter earnings for fiscal 2024 (Q4 FY24), fuelled by increased demand for its services that help enterprises implement generative AI (Gen AI) technology. The company also announced a $4bn share buyback programme.
The generative AI unit of the professional services firm has overtaken growth across other business segments, as companies increasingly turn to automation to cut costs and drive efficiency.
Generative AI boost for Accenture
For the fiscal year 2024, Accenture’s revenue from generative AI deployments drastically surged to $900m from the $100m reported in the last fiscal year. Additionally, Gen AI-related bookings have shown consistent quarterly growth, totalling $3bn for the year. For Q4 FY24, bookings in this segment stood at $1bn.
The company’s outgoing chief financial officer KC McClure emphasised that generative AI will serve as a key growth driver for Accenture over the next decade.
Accenture stated that it has continued expanding data and AI capabilities steadily, increasing its data and AI team to 57,000 practitioners. The firm aims to take the count to 80,000 by the end of fiscal 2026.
Furthermore, the company is leveraging Gen AI to automate manual tasks, improve the software development lifecycle, and enhance the customer experience by freeing employees to focus on strategic growth initiatives.
In addition, Accenture claimed that its strong digital infrastructure allows for real-time data collection and processing, with Gen AI being used for producing new and contextualised insights.
“We delivered full-fiscal year new bookings of $81bn, including a record 125 quarterly client bookings of more than $100m, and now have 310 Diamond clients, our largest relationships,” said Accenture’s chair and CEO Julie Sweet. “We continue to accelerate our leadership in Generative AI, which we believe is the most transformative technology of the next decade, delivering $3bn in new bookings for the year. Our successful strategy to lead reinvention for clients and continued investments in our business have positioned Accenture for strong growth in fiscal 2025.”
Accenture’s overall Q4 FY24 revenues stand at $16.4bn, marking a 3% increase compared to the same quarter in the last fiscal year. This growth included consulting unit revenues of $8.26bn and managed services division revenues of $8.15bn.
The company’s GAAP operating income for the reported quarter rose to $2.35bn from to $1.91bn in the corresponding quarter of FY23. Adjusted operating income for the quarter reached $2.46bn.
For the full fiscal year 2024, Accenture achieved revenues of $64.9bn, an increase of 1% compared to prior fiscal year. The company’s GAAP diluted EPS for the year rose 6% to $11.44 compared to $10.77 reported in FY23.
Accenture has committed to returning a minimum of $8.3bn to shareholders in the coming fiscal year through buybacks and dividends, with $6.7bn already returned. Despite these positive trends, the company’s forecast for annual revenue growth projected at 3% to 6%, falling slightly below analysts’ expectations of 5.9% growth.
Accenture’s estimations also include a 3% boost from recent acquisitions, including that of retail technology services firm Logic in August. For the next fiscal year, Accenture plans to invest $3bn in acquisitions.
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