Accenture Q2 2010 results – facts, metrics & learnings
DATE: March 30th, 2010
Accenture Earnings – Quarter ending 2/28/2010
Release Date : March 25th, 2010
FACTS
- Management Consulting – Demand continues primarily in strategic sourcing and customer relationship management in addition to risk management and post merger integration.
- In Technology Consulting demand driven by infrastructure consolidation and virtualization, security, and IT governance.
- Decline in Health & Public Services revenues for Accenture due to issues with an existing contract. Continues to see uncertainty in Public Services around the world.
- Decline in Communications and Hi Tech verticals.
- Financial Services increase in revenues primarily due to risk & regulatory work, post merger integration.
- Pricing stable in higher value management consulting, IT consulting. Outsourcing has seen a down tick in pricing.
- North America still the lion share for consulting, outsourcing.
METRICS
Quarterly Revenues – $5.2 billion a 2% decrease YoY
Net Income – $462 million a decline of 8% YoY
Operating Margin – 12.6%
Cash Balance – $ 4 billion
Consulting revenues – $2.93 billion, a decrease of 3% in US dollars
Outsourcing revenues – $2.24 billion, flat in US dollars
Global Headcount of 181,000
Global Delivery count – 88,0000
Attrition rate – 15% (including involuntary attrition)
Hiring plans for the year – 50,000 globally.
Utilization Rate – 88%
New bookings for this quarter – $6.52 billion
Consulting – $3.39 billion
Outsourcing – $3.13 billion
LEARNINGS
- Financial Services continue to be the leader in driving outsourcing/offshoring revenues
- Transformation projects no longer long term initiatives. Clients looking for quick hit projects and using a bottom up approach to build on transformation rather than a top down approach.
- Projects being broken down across multiple suppliers
- Europe will continue to be challenged from on outsourcing perspective as the economies and politics of public sector offshoring create uncertainty in the marketplace for vendors.
- Deal size will continue to remain small as companies bite into smaller chunks of outsourcing deals and grow from there. Larger deals , the ones before the crisis will not be the norm anymore.
- Vendor consolidation activities which were fairly high in the last 18 months seem to have tapered off and clients are now focusing more on multiple vendor strategies vs trying to consolidate vendors.
- Companies starting to cautiously get into new initiatives this budgeting cycle.
- Demand for ERP, SAP projects is higher although the size of the initiatives is smaller
Mohit Sharma is the CEO of Corrystone Global Partners. Corrystone is a specialized globalization firm providing advisory, training and staffing services to firms in US and India. We work with firms in the US which are exploring low cost options for IT, Business Process work and looking at ways to further optimize cost and manage operational risk. For firms based in India we help with marketing presence , M&A & client management services in the US. Contact us at info@corrystone.com to learn more about how we could help you.
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