Accenture Shares Fall 18%, Hit Lowest Since 2017 After Q3 Results: Why Accenture Downgraded Revenue Guidance?

Accenture's stock price crashed by nearly 18% in a single day after the Dublin tech giant announced its Q3 results. Investors entered into panic selloffs overnight and pushed Accenture shares to hit their lowest level since 2017. What triggered the severe selling is Accenture's deals which weakened and sales guidance which was downgraded.

Accenture's management commentary signaled that increasing adoption of AI remains a meaningful demand driver; however, it has been insufficient to offset near-term challenges. These weaknesses are discretionary spending pressures, elongated deal cycles and delayed large-program conversions.

This signals that woes of the IT sector globally are likely to be cautious and mixed.

Accenture Stock Price

After the market hours of June 18th trading session, Accenture closed at $127.98 apiece on NYSE, down by 17.97%. This is the lowest performance since 2017. Overnight, Accenture lost $17.26 billion.

Accenture Q3 Results

The Ireland-based tech giant reported revenue of $18.7 billion, an increase of $1.0 billion, 6% in U.S. dollars and 3% in local currency. While its operating margins expanded by 20 basis points to 17%.

However, its new bookings stood at $19.3 billion, mildly lower compared to $19.7 billion in Q3 FY25.

But for the full fiscal year, Accenture trimmed its upper-end revenue growth guidance. Now, the behemoth expects 3% to 4% revenue growth compared to earlier prediction of 3% to 5%.

Should Investors Worry?

Notably, analysts at Choice Institutional Equities said, Accenture cited continued Middle Eastrelated disruption and delayed conversion of certain large opportunities into revenue, suggesting that visibility on discretionary spending recovery remains limited despite improving underlying activity levels.

Overall, analysts added that ACN's commentary suggests that AI is becoming an increasingly meaningful demand driver; however, it remains insufficient to offset nearterm weakness from discretionary spending pressures, elongated deal cycles and delayed large-program conversions."

Also, Accenture reported that there was a adverse impact of $100 million higher than their expectations, which was all consulting/discretionary type of work, split evenly between the direct impact on their Middle East business and indirect effects outside of the region.

"Based on our understanding, it also said that, in addition to this, Sales in the Middle East were impacted by $400 million, and also in EMEA due to longer decision-making by clients. This, based on our understanding, implies adverse growth impact of ~2% yoy on CC terms in 3QFY26," said analysts at Equirus Securities.

However, analysts at Equirus also believe that the downgrade in FY26E CC Sales growth guidance (at the upper end) to 3-4% from earlier 3-5% is not material considering the elevated macro concerns led by increased geo-political issues / US-Iran war and it is almost similar to its original growth guidance worth 2-5% it gave for FY26E with its 4QFY25 results.