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Accenture (ACN) reported a strong operating performance in 4Q. Revenue grew 6% yoy to $18.7bn (7% in LC), well above its 1-5% LC guidance, supported by an uptick in small deals, faster mobilization of new contracts, and over-delivery in federal. The management indicated that broader demand dynamics remained largely unchanged. Per management, pricing was stable through FY26 but declined in many areas in 4Q, suggesting competitive intensity remains a constraint, while AI-led productivity may allow vendors to support incremental volumes with lower hiring. Fixed-price and outcome-based work now account for >65% of bookings, reflecting the shift away from effort-based pricing. ACN plans to increase its FY27 M&A investment to $5bn (excluding $3bn that shifted from 4QFY26 to 1QFY27 due to regulatory timing) to expand into highergrowth, non-FTE revenue areas such as AI, data, cybersecurity, data centers, and IP-led assets. ACN has guided for 3–6% LC revenue growth in FY27, including a 2–2.5% inorganic contribution, implying organic growth of ~1– 3.5% in FY27 vs ~3% in FY26. Overall, the print supports a stabilizing demand backdrop rather than a strong cyclical recovery. The NIFTY IT Index has underperformed the broader market by 4.4%/4.6% over the past 1M/6M amid concerns around weak demand, macro uncertainties, soft discretionary spending, AI-led disruption to the traditional book of business, and evolving industry economics, partly offset by rupee depreciation. Our pecking order among large caps is TCS, INFO, LTM, HCLT, TECHM, and WPRO.

4Q revenue above the high end of guidance

Revenue grew 6% yoy to $18.7bn in 4Q (7% in LC). Consulting revenue grew 6% yoy to $9.3bn (7% in LC), while Managed Services revenue rose 7% to $9.4bn (7% in LC). New bookings stood at $22.2bn (up 4% yoy, 5% in LC), including Consulting bookings of $9.4bn (up 6% yoy; book-to-bill: 1.0x) and Managed Services bookings of $12.8bn (up 3% yoy; book-to-bill: 1.4x). Voluntary attrition (annualized) in 4Q was 13%, down 1% qoq and 2% yoy. Headcount increased 5% yoy, taking total headcount to ~814.4k.

Broad-based growth momentum across geographies and verticals

Revenue growth in 4Q was broad-based across industry groups, led by CMT (11% yoy in LC), followed by Health & Public Services (9%), Financial Services (6%), Resources (6%), and Products (4%). The recovery in Health & Public Services indicates that the US federal drag has largely annualized out. By geography, growth was uniform at 7% yoy in LC across all three markets, Americas, EMEA, and Asia Pacific, pointing to a stabilizing demand environment rather than isolated pockets of strength.

Guides for 3-6% LC revenue growth in FY27

ACN guided for 3-6% LC revenue growth in FY27 (including an inorganic contribution of ~2-2.5%, vs ~1.5% in FY26). The guidance assumes a flat FX impact on reported USD revenue (vs ~2% in FY26). It guided for a GAAP operating margin of 15.9-16.1% for FY27, implying expansion of 50-70bps yoy, and adjusted operating margin expansion of 10-30bps (vs 15.8% in FY26). ACN expects 1QFY27 revenue of $18.95-19.60bn (2–6% LC), assuming a -1% FX impact.

A read-through for Indian IT

peers ACN’s 4Q print is mildly reassuring for Indian IT services, with broad-based growth, a revenue beat, and healthy FY27 guidance indicating enterprise technology demand remains resilient, although the underlying demand environment, particularly discretionary spending, has not materially improved. The 4Q beat was driven by small deals, faster mobilization, and federal over-delivery, while growth remained anchored by large-scale reinvention programs, ecosystem partners, and Data and AI. Consulting growth also rebounded, with FY27 guidance implying a more balanced growth profile; however, the read-through for Indian IT is limited given their lower Consulting exposure and different book of business. AI demand continues to build, with ~100 additional clients initiating their first advanced AI work in 4Q (FY26 total at >400), supporting ACN’s view that AI-led opportunities will outweigh efficiency-related headwinds. Beyond the nearterm demand signal, ACN’s increasing investments in AI, talent, ecosystem partnerships, R&D, and M&A raise the competitive bar for Indian IT, while its shift toward IP-, platform- , and outcome-led offerings could accelerate the move away from the traditional FTE-led model and intensify competitive pressure over the medium term.

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