Accenture Q3 FY25 Results & What It Means for Indian IT Sector

Accenture Q3 FY25 results beat estimates but bookings disappoint—what this means for Indian IT and FY26 outlook.

Accenture’s Q3 FY25 earnings, released on June 20, 2025 at 5:30 PM IST, offer crucial insights into global IT demand—especially in discretionary spending and consulting bookings. As a bellwether for global IT trends, its performance signals broader implications for Indian IT majors.

1. Q3 FY25 Financial Highlights

Metric	Q3 FY25 vs. Q3 FY24
Revenue	$17.7 B (+8 % YoY, +7 % CC)
New Bookings	$19.7 B (-6 % USD, -7 % CC)
• Consulting Bookings	$9.08 B
• Managed Services Bookings	$10.62 B
Generative AI Bookings	$1.5 B
Operating Margin	16.8 % (+80 bps YoY)
EPS (GAAP)	$3.49 (+15 % YoY)
Free Cash Flow	$3.5 B

Outlook: Raised FY25 guidance to 6–7% CC revenue growth, EPS of $12.77–$12.89, and free cash flow of $9–9.7 B .

2. Market Reaction & Key Concerns

Booking Miss & Stock Decline: Shares dropped
CEO & Leadership Changes: Formation of “Reinvention Services” to fuse AI strategy led by Manish Sharma. Other execs reshuffled
Discretionary Spending Weakness: Clients delaying consulting and smaller digital initiatives amid macro uncertainties
Managed Services Softness: Despite robust revenue, bookings in Managed Services underperformed consensus

3. Accenture as Indian IT Bellwether

Sector Signal: Accenture flags caution for global discretionary IT spend; its results are often a precursor to Indian IT trends
Peer Impact: Post results, Nifty IT fell, and stocks like TCS, Infosys, HCL, Wipro dropped ~3%
Mid‑Tier Upside: As mega deal flows soften, agile T2 Indian players like Coforge and Hexaware gain share

4. Discretionary vs. Large Deals

Continued freeze on small consulting contracts and delays in U.S. federal IT projects amid government budget constraints
But large digital transformation deals, notably in BFSI and Healthcare, sustain growth—with Cat 30+ deals worth over $100 M .

5. AI Strategy: Core to Growth

Launched “Reinvention Services” to centralize AI-based consulting, tech, and operations
Generative AI bookings hit $1.5 B—still growing but sequentially slower
Trained ~500 K employees in GenAI, and ramping post‑quantum cybersecurity via partnerships

6. Detailed Indian IT Comparison

TCS, Infosys & Mphasis recommended by Antique, given their stronger balance sheet and selectivity in deal pipeline.
Tier‑2 Growth Edge: Coforge, Hexaware, Persistent gaining mid‑market traction; critical as clients favor agile over mega vendors
Labor & Attrition Trends: Accenture’s attrition eased to ~12%; Indian IT also seeing salary hikes, with Accenture India promoting 43k staff

7. Risks & Outlook

Headwinds: U.S. fiscal tightening, global trade tension, reduced federal spending. Booking softness could persist into H1 FY26
Recovery Timeline: Accenture projects modest pick-up in 2H FY26; visibility remains limited until discretionary spend revives
Valuation Pressure: Premium multiples for AI positioning may compress if bookings continue to lag, per investment note valuation concerns .

8. Investor Takeaways

Growth Picking Up but Vulnerable – Strong Q3 revenue/margin beat, but poor booking signals upcoming headwinds.
AI Strategic Anchor – Reinvention Services and training investment vital for maintaining growth momentum.
Indian IT Exposure Alert – Large Indian vendors reliant on discretionary demand face caution; mid-tier players better positioned.
Stock Strategy – Defensive stance recommended: focus on strong balance sheets and selectivity in deal pipelines.

🧩 Conclusion

Accenture’s Q3 FY25 results deliver a mixed picture: robust financials but constrained bookings, signaling cautious sentiment on discretionary IT. The company’s AI pivot is strengthening its positioning, yet macro exposure remains risky. Indian IT peers should heed this warning—particularly those heavy in small-ticket consulting—while mid-tier firms stand to benefit from a shift toward agile, digital-first demand.

Disclaimer: The projections of potential returns are based on current market conditions and company performance. Actual results may vary due to various factors, including market dynamics, economic conditions, and changes in the competitive landscape. Investors should conduct their own research and consult with financial advisors before making investment decisions.

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