Global consulting and information technology services firm Accenture beat its own guidance in Q2, reporting higher revenue than expected and revising its estimates upward to 24-26% over a previous prediction of 19-22%. The firm’s Q2 revenues amounted to $15 billion, reflecting a year-on-year increase of 24%, up from revenue of $12.1 billion a year ago and at least $300 million higher than its previous guided range of $14.3 to $14.7 billion.
The positive numbers come at a time when businesses around the world are continuing efforts to digitize, pouring billions of dollars into cloud migration and modernization efforts as they continue to adapt to new ways of living, working, and doing business brought about by the pandemic. Global IT spending is expected to hit $4.5 trillion in 2022, according to new data from IT research firm Gartner, driven by an increase in the managed and consultancy services market as well as enterprise software.
In spite of the good news, the firm remains cautious about the rest of the year, citing the ongoing Russian invasion of Ukraine and the resulting political and economic consequences as a factor that could temper growth and impact its operations.
“The invasion of Ukraine by Russia and the sanctions and other measures being imposed in response to this conflict have increased the level of economic and political uncertainty. Accenture’s Q3 and financial year 2021-22 (the firm follows a September to August fiscal year) business outlook does not include assumptions for a significant escalation or expansion of economic disruption or the conflict’s current scope, which could have a material adverse effect on the company’s results of operations,” the company said in a release.
At the moment, many consultancies are publicly pledging to halt their business in Russia. The responses of these firms, which range from no longer taking on new Russian clients to legally separating from Russian partner consultancies, were largely intended to pressure the Russian government into stopping its war and withdrawing from Ukraine. Their efforts, combined with government sanctions, have not produced immediate results as the conflict continues into its second month.