By Accenture, a leading global IT services provider, has announced plans to cut about 2.5% of its workforce in response to a weaker global economic outlook that is reducing corporate spending on IT services. The company now expects annual revenue growth to be between 8% and 10%, compared to its earlier forecast of 8% to 11%. Furthermore, earnings per share are expected to be in the range of $10.84 to $11.06, down from $11.20 to $11.52 previously. Accenture’s decision to lower its forecasts comes as several other tech firms have recently reported weakened demand for their services, including Cognizant Technology Solutions, IBM Corp, and Tata Consultancy Services.
More than half of the 19,000 job cuts at Accenture will be in its non-billable corporate functions, according to the company. Despite this, Accenture’s shares rose more than 4% following the announcement. The company’s CEO, Julie Sweet, said that companies were still focused on executing compressed transformations in response to the turbulent economic conditions. In a survey of over 1,000 IT decision-makers by US-based Enterprise Technology, respondents indicated that they plan to reduce their 2023 budget growth, highlighting the ongoing challenges facing the IT services industry.