Accenture Stock Climbs as AI Demand Boosts Results

Accenture ACN 18.81%increase; green up pointing triangle reported higher quarterly revenue and gave a strong outlook for the year ahead, soothing investor concerns over artificial intelligence-related disruption to its business.

The professional-services firm on Thursday said fourth-quarter revenue rose about 6% to $18.68 billion, topping Wall Street’s estimate of $18.03 billion, according to Fact.

The demand was fueled by clients’ large-scale reinventions, including many driven by AI, Chief Executive Julie Sweet said during a call with analysts.

Sweet said Accenture’s clients are at different stages when it comes to embracing the technology. Much of Accenture’s growth is coming from helping customers build the data foundations and AI stack they need to use AI at scale, she said, while the company is also starting with more clients on advanced AI work for the first time.

Sweet added that Accenture is growing the work it does with some of its biggest clients, like FedEx and BP, as they push further into AI across their businesses.

The company’s better-than-expected results and outlook come as it contends with concerns on Wall Street over whether some of the work it does for clients could be replaced by increasingly capable AI tools.

“We continue to believe the opportunities related to AI are greater than the impact of AI related efficiencies in our business, and we expect that to continue as AI enables enterprises to do much more,” Sweet said.

The stock gained 21% to $221.98, on pace for its largest percent increase on record. Shares are down about 17% year to date.

Accenture is also embracing the technology within its own business, Sweet said.

“AI is making both our own delivery and the technologies we implement more efficient, consistent with prior technology waves,” she said.

Accenture last month agreed to a $2 billion deal with Anthropic to integrate more safety protocols in the AI company’s internal systems. The company said at the time it would lean on its recent acquisition of Faculty, an applied AI company, to help in the partnership.

Accenture’s fourth-quarter profit came in at $1.99 billion, or $3.29 a share, compared with $1.41 billion, or $2.25 a share, a year earlier. Analysts polled by FactSet forecast earnings of $3.18 a share.

Accenture recorded higher revenue across each of its geographic markets and each industry group it works with, with particularly strong growth in communications, media and technology.

New bookings rose 4% to $22.17 billion.

For the full year ahead, Accenture guided for revenue growth of 3% to 6% in local currency and earnings per share of $14.39 to $14.81. Analysts expect revenue of $76.4 billion and earnings of $14.64 a share for the year.

For the current first quarter, the company expects revenue of $18.95 billion to $19.6 billion, compared with analysts’ projection of $19.35 billion.