Managed Services News
“Technology is at the heart of the strategy and as such we expect the labor market to remain tight and we continue to… really differentiate ourselves,” said Julie Sweet, CEO of Accenture. “Despite this market, we’ve added 100,000 new employees even in the last year, so the fact that there have been some layoffs in certain markets won’t really change much, I think.”
Despite the macro environment, inflation and the hiring shortage, Accenture CEO Julie Sweet said the Dublin-based solutions provider continues to excel when it comes to the talent supply chain.
“Technology is at the heart of the strategy and as such we expect the labor market to remain tight and we continue to…really excel,” Sweet said during Accenture’s fourth-quarter FY22 earnings call on Thursday. “Despite this market, we’ve added 100,000 new employees even in the last year, so the fact that there’s been some layoffs in certain markets, I don’t think it’s going to really change much.”
Accenture has what Sweet called an integrated Talent Control Tower, capable of predicting where and what type of skills will be needed earlier and earlier in the sales cycle.
[Related: Accenture Taps Leo Framil As CEO Of Growth Markets]
“For us, this is normal business,” she says. “The need for technology is really unbelievable. All strategies lead to technology and we are very pleased not only with our performance there but also with what we see in the future as clients continue to build the digital core as the foundation for all of their other strategic needs. Our talent supply chain is able to recognize this, predict, understand the skills and evolve.”
Accenture reported a 15 percent increase in revenue to $15.4 billion for the fourth quarter. For the full fiscal year, Accenture reported revenue of $61.6 billion, a record 22 percent increase.
Accenture’s chief financial officer, KC McClure, said the company has the ability to grow and scale profitably while managing wage inflation throughout the year.
“We expect wage inflation to continue and we have factored that into our forecast,” McClure said during the earnings call.
During the Q&A portion of the conference call, a question was asked about inflation, macroeconomics and how it will affect Accenture going forward.
McClure said the company continues to see “really strong demand” for services.
“The latest estimate for IT services continues to show that our industry will grow at about 5 percent,” she said. “We are calling for double-digit growth at the high end of our range and another year of double-digit growth that would add significantly to our current $62 billion business.”
Sweet said that when Accenture thinks about the macroeconomic climate, the company thinks about what customers need.
“This environment affects different industries differently,” she said. “You have the ones that are really connected to supply chain disruption and inflation and they continue to focus on costs. It gets all customers to really think, “Okay, what’s my resilience? Is there more than I can do? Can I use the environment to drive deeper cost reductions that require behavioral change?’”
That’s making Accenture think about what they need to do to meet clients’ needs, much like they did during the pandemic, she said.
“It’s always an opportunity to better serve our customers,” she added.
In the fourth quarter, earnings per share increased 17 percent to $10.71 for the full year. Free cash flow was $3.6 billion for the fourth quarter and a record $8.8 billion for the full year.
New bookings were $18.4 billion for the fourth quarter and a record $71.7 billion for the full year, up 21 percent year over year.
For the 2023 financial year, Accenture expects revenue growth of 8 to 11 percent in local currency. The company’s fiscal year ends on August 31.
Accenture has also been on an acquisition tour since the summer. The latest acquisition came Thursday with the acquisition of Inspirage, an IT services company based in Bellevue, Washington. Inspirage will bring its 710 employees to the Accenture Oracle Business Group to further enhance Oracle’s supply chain capabilities and expand its capabilities to help product-centric customers build intelligent and innovative supply chain networks. The terms of the deal were not disclosed.