Business News/ News / Accenture to cut 19,000 jobs, trims forecasts

Accenture Plc lowered its revenue and profit projections on Thursday and informed that the company would cut about 19,000 jobs. The company became the latest to lay off employees as the global economic outlook affect corporate spending on IT services.

The reduction in revenue and profit projections came as Accenture expects the recession-wary enterprises will cut technology budgets and now expects annual revenue growth to be in the range of 8% to 10% in local currency, compared to 8% to 11% expected previously. The company now expects earnings per share to be in the range of $10.84 to $11.06 compared to $11.20 to $11.52 previously.

The company forecast current-quarter revenue in the range of $16.1 billion and $16.7 billion.

The company informed that more than half of the layoffs will affect staff at its non-billable corporate functions. The shares of the company surged 4% before the closing bell.

In the previous month, Cognizant Technology Solutions, a competing company, indicated a sluggish increase in bookings, which refers to the contracts IT service companies are expected to receive in the future. This was after their revenue projection for the first quarter was lower than what the market predicted.

The announcement of layoffs by Accenture came as a number of companies are cutting jobs in the wake of the recession and record inflation numbers. Technology giants like Meta, Google, and Amazon have announced layoffs and experts have claimed that the spate of layoffs will continue at least for the first half of 2023.

Amazon recently announced another 9,000 job cuts across its cloud services, advertising, and Twitch units as recession fears loom. Earlier this month, Meta announced job cuts starting from 1,500 employees in the human resource department.

Chief Executive Officer Mark Zuckerberg had told employees the economic climate of layoffs and restructuring could last “many years".

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Updated: 23 Mar 2023, 06:07 PM IST
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