- Accenture shares fell nearly 19% after lowering full-year revenue growth forecast to 3%-4%
- Infosys ADRs dropped over 8% and Wipro declined more than 4% following Accenture's outlook
- Accenture's August quarter revenue guidance missed analyst estimates at $17.75-$18.4 billion
Shares of consulting and technology giant Accenture plunged nearly 19% on Thursday, marking their steepest single-day decline on record, after investors reacted negatively to the company's latest earnings outlook and concerns around the pace of AI-driven revenue growth.
The selloff spilled over to Indian IT majors being traded in the US, with American Depositary Receipts (ADRs) of Infosys falling more than 8% and Wipro declining over 4%.
Investor sentiment soured after Accenture narrowed its full-year revenue growth forecast to 3%-4% in local currency. Excluding the impact from its U.S. federal business, revenue growth is expected to be 4%-5%. The company's revenue guidance for the August quarter, at $17.75 billion-$18.4 billion, also missed the Bloomberg-compiled analyst consensus estimate of $18.47 billion.
ALSO READ: Accenture In Freefall: Stock's 12-Month Decline At 50% After Q3 Triggers Fresh Sell-Off
The weaker-than-expected outlook overshadowed an otherwise solid quarterly performance. Revenue rose by $1 billion to $18.7 billion in the quarter ended May, representing growth of 6% in U.S. dollar terms and 3% in local currency. New bookings, however, slipped to $19.3 billion from $19.7 billion a year earlier, raising concerns about demand momentum.
Accenture's shares were already under pressure before the earnings release, having fallen nearly 50% over the past year and more than 41% in 2026 so far. Following the guidance update, futures tied to the stock dropped as much as 13.75% to $134.5 in pre-market trading, signalling a sharp selloff at the opening bell.
The market reaction came despite improvements in profitability. Accenture expanded its operating margin by 20 basis points to 17%, while diluted earnings per share rose 9% year-on-year to $3.80.
The company also generated $3.6 billion in free cash flow during the quarter and returned $2.2 billion to shareholders. That included $1.2 billion through share buybacks and redemptions of around 6 million shares, along with $1 billion in dividend payments. Accenture also raised its quarterly dividend by 10% to $1.63 per share.
ALSO READ: Accenture Shares Crack 14% As IT Major Trims Revenue Forecast; New Bookings Slip To $19.3 Billion
For fiscal 2026, the company lifted its earnings guidance and now expects GAAP diluted earnings per share in the range of $13.38 to $13.50, representing growth of 10%-11%. Adjusted diluted earnings per share are projected at $13.78-$13.90, up 7%-8% from a year earlier. The company maintained its free cash flow forecast of $10.8 billion-$11.5 billion for the full year.
Despite the earnings upgrade, investors appeared focused on slowing bookings growth and the softer revenue outlook, prompting concerns about the pace at which enterprises are converting AI investments into large-scale spending commitments.
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