Accenture Plc, an IT services provider, stated on Thursday that it will reduce its projected annual sales and profit and cut about 19,000 jobs. The action is a part of the company’s attempt to reduce expenses and streamline operations. Accenture CEO Julie Sweet stated in a statement that the company is taking steps to “lower our costs in the fiscal year 2024 and thereafter while continuing to invest in our company and our people to capitalize on the significant growth opportunities ahead.”
The majority of the departures are anticipated to be from corporate duties that are not billable. Over the following 18 months, the business plans to finish the job cuts. Accenture’s shares increased by more than 4% before the starting bell as a result of the news of the layoffs.
Additionally, Accenture has lowered its annual sales and profit forecasts. In place of the previous prediction of an increase of 8% to 11%, the business now anticipates annual revenue growth to be between 8% as well as 10%. Accenture expects revenue for the current quarter to be in the region of $16.1 billion and $16.7 billion. According to data from Refinitiv, analysts expected $16.64 billion in sales on average.
Following a recent trend, leading tech firms have announced mass layoffs, including Accenture. Aside from Twitter and Meta, other businesses that recently declared layoffs include Microsoft, Amazon, Twitter, and Meta. Amazon revealed on Thursday that it is firing 9,000 more people, primarily from Twitch, AWS, and advertising. The large e-commerce company had already let go of close to 18,000 workers.
Numerous businesses, including those in the tech sector, have experienced business disruption due to the epidemic. The shift to digital business and the new reality of remote work has required many businesses to adapt. As a consequence, some businesses were forced to reduce expenses, including by making layoffs.
Accenture is an example of a firm that has been enhancing its operations and capabilities. The business declared in September 2021 that it would spend $3 billion over the following three years to assist its customers in becoming more resilient and sustainable. The funding will concentrate on areas like sustainable supply chains, circular economies, and renewable energy.
Additionally, the business has been developing its skills in cybersecurity, cloud computing, and digital change. Accenture stated in August 2021 that it would buy German cybersecurity company IT-Designers GmbH to expand its cybersecurity capabilities.
Accenture maintains optimism about its opportunities for future development despite the layoffs. The business has been actively seeking out fresh talent and making investments in its employees. Accenture stated that it would increase diversity and inclusion by hiring 150,000 people worldwide by 2025 September 2021.
In conclusion, Accenture’s decision to reduce its revenue and profit forecasts and eliminate jobs reflects the difficult business climate that many companies are experiencing as a result of the pandemic. The business may weather the ongoing uncertainty thanks to its decision to streamline operations and cut costs. To take advantage of potential future growth opportunities, the firm is still committed to investing in both its operations and workforce.
