Accenture’s forecast cut raises new concerns about IT recovery
BENGALURU: Accenture’s decision to downgrade its revenue growth guidance for FY26 has intensified concerns about the pace of recovery in the global technology spending environment. Brokers warn that Indian IT services companies may face a prolonged period of weak demand extending into FY27.The Dublin-based IT services giant lowered the upper end of its FY26 revenue growth guidance by 100 basis points, and now expects revenue growth of 3-4%, or 2.5-3.5% on an organic basis excluding the impact of federal services. The forecast disappointed investors, sending Accenture shares down as much as 18% on Thursday to about $129 on the New York Stock Exchange. US financial markets were closed on Thursday for the June 15 holiday.The resilient performance in the third quarter was overshadowed by the guidance reduction.
Revenue for the quarter ended May 31 rose 6% year over year to $18.7 billion in dollar terms, while local currency growth was 3%, Accenture’s slowest growth rate in eight quarters.The comment has renewed concerns for Indian IT companies, many of which derive a significant share of revenue from discretionary spending on technology. Analysts at Ambit Institutional Equities said weakness in Accenture – widely seen as the strongest player in global IT services – has a negative reading on demand prospects across tier-one IT companies in India and indicates a weaker-than-expected start to FY27.CLSA said the guidance cut and softer managed services order book appeared to reflect the challenging macroeconomic environment rather than disruption caused by artificial intelligence.
