Accenture Plc (NYSE:ACN) stock fell 1.48% (As on March 22, 11:21:00 AM UTC-4, Source: Google Finance) after the company cut its annual revenue forecast in the latest sign that the once booming consulting market is slowing. Pointing to an “uncertain macro environment”, the New York-listed group said that its full-year revenues would grow between 1 and 3 per cent, below an earlier prediction of 2 to 5 per cent, underlining the challenges facing the consulting sector. Consulting revenues fell 3 per cent to $8bn while sales at its managed services, or outsourcing, division grew 3 per cent to $7.8bn. The overall slump was driven by the group’s communications, media and technology and financial services subdivisions, where sales fell 8 per cent and 6 per cent respectively during the quarter. However, operating income rose 5.7 per cent to $2.05bn in the quarter. Accenture said demand for generative AI projects remained robust, with over $600mn in bookings during the quarter, taking total bookings in this area to $1.1bn during the first half of its financial year. Adjusted net income for the quarter was $1.80 billion, compared with $1.74 billion for the second quarter of fiscal 2023.

Further, operating cash flow for the quarter was $2.10 billion, and property and equipment additions were $110 million. Free cash flow, defined as operating cash flow net of property and equipment additions, was $1.99 billion. For the same period last year, operating cash flow was $2.33 billion; property and equipment additions were $108 million; and free cash flow was $2.22 billion. Days services outstanding, or DSOs, were 43 days at February 29, 2024, compared with 42 days at both August 31, 2023 and February 28, 2023. Accenture’s total cash balance at February 29, 2024 was $5.1 billion, compared with $9.0 billion at August 31, 2023.

ACN in the second quarter of FY 24 has reported the adjusted earnings per share of $2.77, beating the analysts’ estimates for the adjusted earnings per share of $2.66, according to Zacks Investment Research. The company had reported the flat revenue growth to $15.8 billion in the second quarter of FY 24, missing the analysts’ estimates for revenue of $15.82 billion. Gross margin for the quarter was 30.9% compared to 30.6% in the second quarter of fiscal 2023. Selling, general and administrative (SG&A) expenses for the quarter were $2.72 billion, or 17.2% of revenues, compared with $2.65 billion, or 16.7% of revenues, for the second quarter of fiscal 2023.