Salem Radio Network News Wednesday, July 6, 2022

Business

Accenture forecasts fourth-quarter revenue below estimates on forex hit

(Reuters) -IT services company Accenture Plc forecast fourth-quarter revenue below expectations on Thursday, expecting a hit from high inflation and the impact of a stronger dollar on its overseas earnings.

Shares of Accenture, a bellwether for global IT spending, fell 2.8% in trading before the bell.

A hawkish Federal Reserve and heightened geopolitical tensions have driven gains in the dollar against a basket of currencies over the last year.

A stronger dollar typically eats into the profits of companies that have sprawling international operations and convert foreign currencies into dollars. Accenture makes more than half of its revenue from outside the United States.

The company forecast fourth-quarter revenue to be in the range of $15.0 billion to $15.5 billion. Analysts on average were expecting $15.70 billion, according to IBES data from Refinitiv.

The forecast reflects the company’s assumption of a negative 8% foreign-exchange impact, Accenture said.

Revenue for the quarter ended May 31 was $16.16 billion. Analysts on average had expected $16.03 billion in revenue.

(Reporting by Chavi Mehta in Bengaluru; Editing by Shinjini Ganguli)

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