Accenture shares jump as artificial intelligence orders surge

Shares of Accenture ( ACN ) rose on Thursday after the consulting giant reported third-quarter results that reported earnings beat estimates and an increase in artificial intelligence (AI)-related bookings.

Accenture reported revenue of $16.47 billion for the quarter, up from $16.56 billion in the third quarter of 2023 and below analysts’ expectations of $16.55 billion, according to estimates compiled by Visible Alpha.

Net income attributable to the company was better than estimates, however, as Accenture reported a profit of $1.93 billion, or $3.04 per share, compared with last year’s $2.01 billion and $3.15 per share, but was better from the $1.91 billion and $3.01 per share expected by analysts.

AI bookings are on the rise

The company said its AI efforts are paying off, with more than $900 million in new generative AI bookings this quarter, bringing Accenture’s total AI bookings to $2 billion fiscal year-to-date.

Overall new bookings were $21.06 billion, up 22% from the same period last year, with 44% of bookings coming from consulting services and the remaining 56% from Accenture’s managed services business.

“We also achieved two significant milestones this quarter – Generative AI sales of $2 billion year-to-date and revenue of $500 million year-to-date – demonstrating our early leadership in this key technology,” Accenture CEO (CEO) Said Julie Sweet.

Dividend announced, guidance updated

The company also announced another quarterly dividend, announcing plans to pay $1.29 per share on August 15 to shareholders of record on July 11. Accenture also repurchased $1.4 billion of its own stock during the quarter and said it had $3.3 billion remaining in its current repurchase plan.

Accenture forecast fourth-quarter revenue in the range of $16.05 billion to $16.65 billion, compared with analyst estimates of $16.54 billion. Accenture revised its full-year guidance to forecast revenue growth from 1.5% to 2.5%, narrowing from its previous range of 1% to 3%.

Accenture also lowered its full-year diluted earnings per share (EPS) guidance to a range of $11.29-$11.44, down from the previous range of $11.41-$11.64. The company had previously said it faced an “uncertain macro environment” and noted that customers were cutting back on some discretionary spending.

Accenture shares rose 6.2% to $302.90 as of 10:21 a.m. EST on Thursday, but are down more than 13% so far this year.