Accenture cuts jobs, trims forecasts on worries of lower IT spending
Accenture cuts jobs, trims forecasts on worries of lower IT spending
The Accenture logo is seen in this image.
Accenture Plc lowered its annual revenue and profit forecasts and said on Thursday it would cut about 2.5% of its workforce, the latest sign that the worsening global economic outlook was sapping corporate spending on IT services.
More than half of the 19,000 jobs to be cut will be in its non-billable corporate functions, Accenture said, sending its shares up more than 4% before the bell.
Since late last year, the tech sector has laid off hundreds of thousands employees due to a demand downturn caused by high inflation and rising interest rates.
Rival Cognizant Technology Solutions last month pointed to "muted" growth in bookings, or the deals IT services firms have in the pipeline, in 2022 and forecast quarterly revenue below expectations.
IBM Corp and India's top IT services firm Tata Consultancy Services have also flagged weakness in Europe, where the Ukraine war has affected client spending.
Accenture now expects annual revenue growth to be between 8% and 10%, compared with its previous projection of a 8% to 11% increase. Earnings per share is expected in the range of US$10.84 to $11.06 compared with $11.20 to $11.52 previously.
"Companies remain focused on executing compressed transformations," Chief Executive Julie Sweet said in a post-earnings call referring to how businesses were trying to become leaner in the turbulent economy.
A survey of more than 1,000 IT decision makers by U.S.-based Enterprise Technology Research said they plan to reduce their 2023 budget growth. The growth expectations are now 3.4%, down from 5.6% increase captured in October 2022.
"Our forward-looking technology spending intentions data for both sectors (IT Consulting and Outsourced IT) are approaching zero!" said Erik Bradley, chief engagement strategist at the technology market research firm.
"In short, the data indicates a very difficult environment ahead for consulting firms."
Reporting by Chavi Mehta in Bengaluru; Editing by Sriraj Kalluvila and Arun Koyyur
Opening a Registered Education Savings Plan (RESP) is a great way to fund your child’s future education. Personal finance contributor Christopher Liew outlines the contribution rules for RESPs and explains how to find out how much contribution room you have left so that you can avoid penalties.
If you're like many would-be vehicle shoppers, you may be wondering when prices will finally drop. The good news is that the vehicle market seems to be finally stabilizing, says personal finance contributor Christopher Liew.
Personal finance contributor Christoper Liew shares the latest information about who’s eligible for the grocery rebate, when they can expect their payments, and some helpful tips on making the most of your grocery rebate.
As a former financial advisor, I’ve always been fascinated by how the 'culture' around money differs from one region of the world to another,' writes personal finance commentator Christopher Liew. 'Today, I’ll outline some of the interesting money habits that I’ve noticed while travelling the globe, starting with some of our own!'
With the rising cost of food and living expenses, you might be considering asking for a raise. On CTVNews.ca, personal finance contributer Christopher Liew explains how inflation could determine the extent of your raise, as well as other key factors.
On CTVNews.ca, personal finance contributor Christopher Liew explores some of the top sources of passive income in Canada, for those looking to increase their earnings.
Getting an income tax refund can be a happy bonus for your household budget, but an unexpected tax bill can be an unpleasant surprise, especially if you don't have the cash on hand to pay it.
Those prices have been increasing even more along with the rising cost of groceries overall. Celiac Canada says gluten-free products cost between 150 and 500 per cent more than their regular gluten-containing equivalents.
The Accenture logo is seen in this image.
