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Accenture warns of potential impact from Russia-Ukraine conflict

Randy Mancini 2 Mar 17
FILE PHOTO: Illustration shows a smartphone with displayed Accenture PLC logo
FILE PHOTO: Accenture PLC logo is seen on a smartphone in front of displayed same logo in this illustration taken, December 1, 2021. REUTERS/Dado Ruvic/Illustration

March 17, 2022

(Reuters) -IT consulting firm Accenture Plc said on Thursday its operations could be adversely impacted if the Russia-Ukraine conflict escalates, as the sanctions on Moscow increase the level of economic and political uncertainty.

Accenture forecast third-quarter revenue above Wall Street estimates, but it excluded the impact of the war.

The company said its forecast did not include “assumptions for a significant escalation or expansion of economic disruption or the conflict’s current scope.”

Shares of the Dublin, Ireland-based company rose nearly 5% in premarket trading. The stock has fallen nearly 22% so far this year.

Earlier this month, Accenture said it was discontinuing business in Russia in response to the country’s invasion of Ukraine. The company’s revenue in Russia stood at $120 million during fiscal 2021.

New bookings for the second quarter stood at $19.6 billion, lifted by demand for its cloud and security-related services as more businesses transform to hybrid work model.

Analysts have also suggested that the enterprise software markets that include players such as Oracle and Salesforce are showing more positive trends in client spending.

Revenue for the second quarter stood at $15.05 billion, compared with analysts’ average estimate of $14.65 billion, according to Refinitiv IBES data.

Accenture, whose clients include more than three-quarters of the Fortune Global 500 companies across communications, media & technology as well as financial services industries, is also strategically investing in cloud, acquisitions and partnerships to gain more market share.

The company expects current-quarter revenue between $15.70 billion and $16.15 billion, compared with analysts’ average estimate of $15.11 billion, according to Refinitiv IBES data.

(Reporting by Tiyashi Datta in Bengaluru; Editing by Shinjini Ganguli)