ACN earnings call summary

Prepared Highlights

• Q3 revenue: $18.7B, +6% USD / +3% local currency (prepared), with consulting $9.3B (+4% USD / +1% LC) and managed services $9.4B (+8% USD / +5% LC) (CFO); excluding ~1% federal headwind, total revenue grew ~4% LC (CFO)
• Geographic growth: Americas +1% LC (US driven; ex-federal ~+3% LC), EMEA +4% LC (UK/Italy offset by Germany & Middle East), Asia Pacific +8% LC (Japan/Australia/Singapore) (CFO)
• New bookings: $19.3B, -2% USD / -3% LC; book-to-bill 1.0; consulting $10.3B (book-to-bill 1.1), managed services $9.1B (book-to-bill 1.0) (CFO)
• 30 clients with quarterly bookings >$100M; year-to-date 104 such bookings (+13% YoY) (CEO)
• Operating margin: 17.0%, +20bps YoY; gross margin 32.8% (vs. 32.9% prior year), SG&A 9.7% sales & marketing (vs. 9.9%), G&A 6.1% (flat) (CFO)
• EPS: $3.80 diluted, +9% YoY; effective tax rate 24.2% (vs. 24.0% Q3 last year) (CFO)
• Free cash flow: $3.6B (operating cash flow $3.8B, capex $186M) (CFO)
• Capital returns: $2.2B returned ($1.2B share repurchases, $1.0B dividends); YTD $8.2B returned (+$1.3B YoY) (CFO)
• Middle East conflict impact: ~$100M revenue impact (all consulting, split 50/50 direct/indirect); sales impacted ~$400M in Middle East & EMEA; large managed services deals pushed to FY2027 (CEO)
• Acquisition spend: now expect ~$9B deployed this fiscal year (including Dragos majority stake, runZero, NetRise for OT cybersecurity platform); inorganic contribution ~1.5% for FY2026 (CFO, CEO)
• OT security acquisitions (Dragos, runZero, NetRise): $208M ARR growing 48%; more than triples TAM in OT security (double-digit growth) (CEO)
• New mid-market business (Accenture Edge) targeting $240B TAM (companies $300M–$3B revenue, high single-digit growth) (CEO)
• People: ~124,000 promoted this fiscal year (+30% YoY), including >900 to managing director (CEO)

Official Guidance

• Q4 FY2026 revenue: $17.75B–$18.4B; FX impact ~-0.5%; 1%–5% local currency growth; federal business expected to return to growth (CFO)
• Full-year FY2026: revenue 3%–4% local currency growth (incl. ~1% federal headwind; ex-federal 4%–5%); adjusted operating margin 15.8% (+20bps YoY); adjusted effective tax rate 24%–25% (vs. 23.6% FY2025); diluted adjusted EPS $13.78–$13.90 (7%–8% growth over FY2025) (CFO)
• Cash flow: operating cash flow $11.5B–$12.2B; capex ~$700M; free cash flow $10.8B–$11.5B; free cash flow/net income ratio 1.3; expects to return at least $9.5B via dividends and buybacks (CFO)
• FY2027 entrance: slightly below 2% inorganic growth from current acquisitions; AFS headwind sunsets in Q4; large managed services deals pushed to FY2027 (CFO, CEO)

Mgmt Quotes

• Julie Sweet (CEO): "We believe that AI will be a tailwind for us and our industry as it scales, because it is a catalyst for reinvention and is creating new opportunities for growth and efficiency for our clients and for us."
• Julie Sweet (CEO): "We are starting to see clients who have more advanced digital cores move to larger AI transformation programs... The major theme of all of these programs is that we are moving clients from using AI to running on AI."
• Julie Sweet (CEO): "This investment more than triples our total addressable market in OT security, which is growing double digit."
• Angie Park (CFO): "Given the macro uncertainty, we expect more of the guided range to be in play for Q4."
• Angie Park (CFO): "Based upon these results, we are on track to deliver or exceed all aspects of our guidance provided in September."

Prepared Metrics