Accenture reports double digit revenue growth; earnings benefit from US tax code

IT services provider Accenture (ACN) reported positive top and bottom line results for the second quarter. Revenue climbed by 14.9% to $10.06 billion, driven by a foreign exchange impact of positive 5.5%. Earnings, on a per share basis, drove up 3% year-over-year, helped by a $137 million or $0.21 per share charge related to the recent US tax law changes. The company reported net income of $919.5 million or $1.37 per share compared to the year ago earnings of $887.2 million or $1.33 per share. Accenture continues to benefit from its cloud, digital and security solutions, which account for more than 55% of its revenue.

Bookings

Second quarter new bookings were $10.3 billion, up 11.9% year-over-year, with consulting and outsourcing bookings at $5.7 billion and $4.6 billion, respectively.

Outlook

For fiscal year 2018, the company is seeing revenue growth to be in the 7% to 9% range in local currency vs. its earlier growth expectation of 6% to 8%. The Dublin, Ireland-based company eyes for GAAP diluted EPS to be in the range of $6.40 to $6.49, including the $0.21 charge related to U.S. tax law changes. On an adjusted basis, Accenture expects EPS to be in the range of $6.61 to $6.70 vs. $6.48 to $6.66, previous target.

For third quarter 2018, Accenture estimates revenue to be in the range of $9.90 billion to $10.15 billion.