Accenture has delivered better-than-expected earnings and revenue for the first quarter of fiscal year 2025 (Q1 FY25), exceeding analyst expectations and prompting a rise in its share price during premarket trading. The company has raised its full-year revenue growth outlook, reflecting confidence in its ability to capitalise on growing demand for digital transformation and AI-driven services.
Following the announcement, Accenture’s stock climbed by over 6% in early trading, reflecting investor confidence. The multinational consulting company reported revenues of $17.7bn, a 9% year-over-year (YoY) increase. New bookings for the quarter reached $18.7bn, comprising $9.2bn in consulting contracts and $9.5bn in managed services agreements, driven by robust demand across industries.
Segment growth and AI contributions
Segment performance highlighted strong growth, with the health and public service unit posting a 13% revenue increase to $3.8bn, and the products segment climbing 12% to $5.43bn. Notably, generative AI contributed $500m in revenues for Q1, with $1.2bn in new AI-related bookings secured during the quarter. In response to the strong quarterly performance, the company updated its guidance for fiscal 2025, projecting revenue growth of 4-7%, up from the previous estimate of 3-6%.
Looking ahead, the company expects Q2 FY25 revenue between $16.2bn and $16.8bn. Accenture has also outlined plans to strengthen its capabilities in AI, data and digital transformation, including a workforce expansion targeting 80,000 data and AI specialists by 2026. The company credited the increased adoption of AI and digital tools by clients as a major growth driver. According to the company, a strong digital core is essential for this reinvention. For FY25, Accenture expects a significant portion of its growth to come from helping clients with digital transformation, building their digital core and utilising it to boost productivity and foster growth. Accenture is leveraging generative AI across industries to help clients optimise operations, from predictive maintenance in manufacturing to automating workflows in advertising operations.
“We are also infusing our GenAI tools to enhance the software development lifecycle and automate manual tasks, such as resolving technical issues with customer orders, invoices or service availability,” said Accenture chair and CEO Julie Sweet on the earnings call. “Now this will free up employees to focus on strategic growth initiatives and improve the overall customer experience.”
Accenture’s operational efficiency also underpinned its performance, with its GAAP operating margin improving to 16.7% from 15.8% in the same period last year. This was further supported by disciplined cost management and strategic investments, including $6.6bn in acquisitions over the last fiscal year.
Read more: Accenture’s Q4 FY24 earnings exceed estimates, driven by Gen AI technology
