ACN - Earnings call transcript Q4 2020

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to Accenture's Fourth Quarter Fiscal 2020 Earnings Call. [Operator Instructions]. And I would now like to turn the conference over to your host, Angie Park, Managing Director, Head of Investor Relations. Please go ahead.

Angie Park

Thank you, operator, and thanks, everyone, for joining us today on our fourth quarter and full fiscal 2020 earnings announcement.

mentioned, Park, just of Director, operator Relations. Investor the I'm Managing Angie Head As you from Financial will Chief call, today's On hear and McClure, Executive Julie KC our Chief Officer. Officer; our Sweet, an opportunity time short We hope you've to the issued ago. news review a release had

operational outline key for statement the provide financial fiscal brief the some me business positioning along an the both Julie income first metrics with the today's Julie details, update year. will balance with XXXX. provides through quickly year Let of take our you call. begin the KC and market sheet, full for quarter and quarter fourth fiscal and overview results. our will our the a agenda then for before full KC will outlook on including

your take call. before questions of a Julie end the wrap-up then will We at the provides

on materially matters but set to are today's such, cause report and results release reports the as These we'll of Form forth in risks Some could discussed and uncertainties, our call, on and unknown those discuss outlook, business those including factors forward-looking limited to, and and subject our are from filings. in this Form this known not in call. annual SEC uncertainties XX-Q XX-K on and differ and news to expressed other risks quarterly actual including,

at of We in reconciliations certain of or measures, GAAP website accenture.com. we which release the include useful financial appropriate, financial for will non-GAAP Relations our in call today, investors. reference section news we During believe provide measures our our information Investor to non-GAAP where

conference update no call. the As information presented obligation assumes on to always, this Accenture

over call let turn Now Julie. me to the

Julie Sweet

our all demonstrate our have thank trusted of and on the and from that helped to Fiscal the core 'XX to our the we rigor doubt, of Angie, the we the clearly focusing the with ability people, people and investing to an needs values, in to and has to our partner And growth rapidly our the our our of the business you, clients ecosystem our us demonstrated us. strategy, new make of our any operational operating. the inclusion business, the responsible and joining company, of 'XX matters. track that their make Fiscal to relationships leading ever innovation-led focus and our live which diversity year us commitment everyone, economic ways way advantages pivot record for social and of meet resilience have being if on health, relevance a our also scale discipline, in we power demonstrated you, the companies long of global clients that world's was turned and crisis. of of face and our Thank help ongoing partners results unique there skills,

in been experience groups with have XX the 'XX. well intelligence large strategy across and are critical We cloud accelerating our digital four leadership are FY a footprint. services of as of artificial technology with consulting, operations has client the and scale and unique as half and to services building our industry in transforming the also core its scale a our unique of to core, the deep second growth digital, our And data company's in and industry in we capabilities. scale capabilities, This and all for operations, global for our our industry relationships we and and interactive, security with resilience

few a Let me share highlights.

result dramatically COVID-XX. New"- are already of XX% in We approximately now services, cloud security, accelerated as for just and digital, when need these "the the a high,

embedded the measure we is as now digital we March New" our core. X, everywhere. 'XX, FY fact, with have In no of New" And growth "the in "the longer will as model, new

to and committed we We of and in ever FY net the new investments stronger. our finishing scale committee our continue our in billion new platforms We while in a and later. the increase agility $XX of new invest a a to quarter, R&D our X,XXX sales. growth In in market to our to record and fourth challenging solutions, seamlessly And patents for growth over our XXX in our largest client to $X.X the prior delivering of and to model digital our of cost to and assets, billion that together hours We multiservice with XX global our to second navigating our training share large, represent we to 'XX, increase power these in X% bookings with greater million continue relationships, with the XXX,XXX transitioned year. ended our bringing clients, our the opportunities by increase for we acquisitions, security learning our with delivered QX, high-growth for color We clients million test, opportunities. passed successfully platforms. a stronger team continued More a to people. patents in including FY $XXX on $XXX with model cloud at future and pandemic management the will in over 'XX drivers, increase emerging our create teams including training and pending people, as the due reducing highest Diamond on bookings growing portfolio which year XX% to

Latinx we this volatility, and American XX% saw the for to and of ambitious goals on QX, called announced it before declared uncertainty a and African-American only balance. we our days communities pandemic with XX-XX U.S. the it like guidance. XXXX and now And and give new the had of goal few each to our we in are increase for our delivered gender women, track And month, QX guidance a Hispanic within we despite for unprecedented and We QX Black

free modest continued and ahead deliver cash our market For range the flow. within growth record either delivered to guided of full year, and expansion we above or margin

leadership an begins incredibly our people. exceptional and with team and dedicated talented resilience Our

Before year KC, all I that exceptional want to truly to over proud should to been of. I turn over an you. them each of we for has KC, thank what be

Kathleen McClure

and of quarter, today's Thank were results thanks We pleased you, fourth and call. our to us in were the our all joining our overall guided on expectations. you within with which to Julie, for aligned range

diversity unique reinforce and for with distinctive an marketplace significant results Accenture's our business position our to results deliver Our these our in in the and reflect discipline the value Once illustrate our run again, shareholders business. ability environment. uncertain of

with This of includes currency, a of decline costs. revenues approximately in percentage highlights few points So a guided the let from quarter. X% from in Revenues our X summarizing range. reduction line begin the declined of me travel in by a reimbursable local

defense; and, continued well. energy; expected, significant impacted industry from last market high growth & industries, consistent we the industrial. quarter both Platforms from single serve in continued that From XX% which to year. came Importantly, less perspective, aligned travel; in we our with double-digit to retail; the high continued grew clients industries Sciences. time, saw and aggregate, share the digits and The as with and diversity were quarter, in pressure of and Public same an At we the highly revenues continues with including pandemic aerospace Life include tech, growth Service, Software us take for our seven of our imperatives, impacted approximately business from

performance of XX.X%, revenues Operating points XX quarter margin declined varied, an this full year. of and over While our for XX% increase represents and basis collectively the mid-teens. group the was

extend in to business our market continue drive significant and our to making people investments We while our sustainable margin expansion leadership.

delivered free continue We benefit billion, meetings from to And which flow finally, cash superior of $X spend surpassed expectations, on by our DSO travel, management. lower and driven we events.

turn me let of the Now to some details.

for this bookings. that they in quarter, as very approximately XX% billion and our X% consulting. X.X. new for highest operations with Consulting billion growth with estimate a We on expected, and dominated and book-to-bill in of and on billion of technology our a expectations by were our with X.X. strategy X.X. continue record, delivered lower were with which and came record of bookings Outsourcing $XX we a were of demand represented bookings reflect digital, to strong of a security-related quarter, in bookings of Bookings and bookings New strong bookings strong were be cloud pleased we book-to-bill $X.X second the we book-to-bill $X.X services, bookings

local dollars. Turning U.S. digits. billion, of in low quarter currency teens. X% U.S. Technology now including a X% grew which Taking single from in to $X.X Revenues billion, a travel X% And in from revenues. and Digital, includes Outsourcing in $X.X services of a were declined look consulting local X% service security-related currency in dollars, from and dollars, U.S. Operations for closer were a from dimensions. X% and currency for local the approximately the single decline digits. reimbursable a and were decline revenues at and high in mid-single $XX.X Consulting strategy grew costs. a decline services reimbursable up X% quarter approximately revenues of billion, X% our low cloud both digits. a travel costs. services grew revenues revenues reduction decline in decline reduction

growth the the out Before with I saw similar all currency, local in Brazil. that growth in Europe, give in previously currency. was In led high double-digit growth in in fashion in in dynamics We local X. mid-single-digit revenue North Germany, growth Growth In industry we across revenue color on growth I currency. in Italy, X% In Japan in flat declined X% Markets, growth slight single-digit continued a revenue our have and local America, mentioned delivered markets, played declines by U.K. the

was expense margin, basis and for quarter last General income administrative year. XX.X%, compared same the reflecting margin a with the XX for same down Operating the the year. Gross quarter consistent quarter $X.X was X.X% the to fourth compared last XX.X% in period last QX was XX.X% the quarter year. marketing XX.X% up and Sales statement. year. billion Moving last compared X.X% operating income was expenses fourth with with for quarter, points for the

impact the that $X.XX reconciliation a an I Of in to website. full be factored impacted increased for Before exclude results. can gain guidance $X.XX by adjusted tax and this our $X.XX quarter I'd this highlight gain, year. EPS and EPS full following into our for and reflect fourth and $X.XX rate found The continue, quarterly year was provided like the comparisons investment June, on the

the were tax quarter for of effective rate EPS fourth the $X.XX tax Adjusted diluted XX.X% of compared fourth earnings per an compared effective year. with last rate the year. was quarter $X.XX XX.X% last in adjusted for to quarter Our share

billion, compared above the XX year. were For was XX days Days outstanding per adjusted $X.X the equipment our net range of year. service and from of full XX adjusted cash fourth $X.XX flow days last which billion, by guidance $X activities cash days Free resulting quarter fiscal share were million. in the $XXX last earnings for of $X.XX, and generated of to property for quarter year, additions the quarter operating was

million $X.X $X.X the started quickly momentum million increase price our Our $XXX approximately per highs cash for was XX% setting shareholders, repurchased additional last new at Also with XX $XX reset with regards a August X pandemic. for our approved X.X XX, share per With the August, record dividend at of November share or fourth this objective a ongoing billion share and and reflecting $X.XX quarter, per year. in billion declared delivered paid and for last bookings, to repurchase the million. We average half balance in And of quarterly to dividend XX% to onset Directors of billion our fourth We last cash over August year, $X.XX redeemed shares on full total cash an the paid be authority. at year, to a return XX we $XXX.XX in Board the we strong of our billion over year. of in results of first a share. with Reflecting $X cash $XXX of year. increase quarterly compared adjusted

people, for last communities fiscal 'XX proud billion expansion significantly our our positioning all returned closing of how even 'XX. $X within of outlook provide delivered guided to continued commitment our In share. elements on us, year to line our taking our partners business our of in and We our at cash fiscal $X.X range are a our behind provided billion acquisitions, revenues delivered our business billion delivered our our managed we capital $X.X with what importantly, and fully fiscal shareholders, of X%, we with investments cash And flow lower of truly year good feel we shareholders, for clients, We really unprecedented an with exceeding our was growth top free in continued on market and, and record guidance of about year. September. allocation, margin and throughout the

turn to let Julie. back it me Now

Julie Sweet

overall an transformation quarter of and are and address enterprises trends sources the From move KC. build which need accelerate last cloud; by remote-everything resilience; to to discussed new their digital the you, operations are continuing. Thank universal; that perspective, but demand we to find vary cost engagement their pressures, a customer Companies and across environment; adjust their industry growth.

which The redesigning enabling Financial, I and agreement leader $XX a digital leader accelerate Nixdorf, streamlining entered transformation and banking to financial and XXXX, savings on IT QX. the sales to ability Accenture Then manager, some that in by simple, will innovation and brokers, clients wellness for bookings with into agreement and opportunities. human while over customers investment 'XX. year growth its more consolidating I investment in Now cloud employees little lens interactions our in unlock transform million in finance, have collaboration industries, its through to intuitive to new a depth of to operating software environment wellness. $XXX financial insurance color and productivity, million technology active Accenture strategic an will between the includes a breadth a give resource, incremental retail Diebold the Nixdorf's its global and and group create deliver operations with improving processes, and Prudential global Diebold this you services, clients hardware systems. business will value has enhance turn approximately XX multiyear and of through operations premier model and our of to program, our of fiscal extended

complete intelligence helping and and energy user HPE its the cloud. services with by provide strategic of need our X-year cloud, cloud-based address physical to growth. and sustainability onboarding, Accenture IT These across a enhancing the its Accenture diversity pressures address experiences migrate and and And value. for addition SynOps revenue XX footprint designed months in more teams, transform to additional migrating Halliburton, in its XXX-degree applications clear global agility, XX% centers ultimately, move employees cost New AWS the industries, using the to into seamless automotive or global and team satisfaction Microsoft agreement Microsoft provider we are our noteworthy as moment. reduce us achieve over the will advance multiservice move analytics processes, digital to clients' leading agility, artificial by capabilities GCP, This ecosystem their reduce and cloud, company has many and to expenditures benefits will customer our and solutions to complexity as by helping platforms billing and from operations call Halliburton examples reskill A its requiring obsolescence capital to all well the will public human-centered products working data its its delivering digital back strong leading stepping their Accenture platform strengthen entered Halliburton's hybrid and ecosystem offerings to we infrastructure delivering to a platforms, drive Interactive and data-driven, their powered experiences. to cloud for a for what claims provide partnerships and, to Azure. and financial Azure. work business in And value, and digital digital solutions. of selected are industry, creating for of both partners assets, because our involve carbon

ever change that and and aspect to a us COVID-XX. business Then unprecedented by being were virtually COVID-XX, meaning turning and are of impacted unprecedented change clients giving their before, whole for every requiring to faster they new help change to need came to embrace clients than Our become our before stronger.

Turning year to 'XX. fiscal

page. business formula 'XX turning with for and We a talented to own our change for enduring. fiscal leadership create as our We market is clients year more Our continually value embrace people. incredibly transform view

no are We navigating crisis. longer a

a We ready. reality, of to fiscal growth returning by rates pre-COVID the year, new half plan are we and are on facing second we and this

entered, stronger fiscal when was 'XX We second our are we than year from strategy. of the half emerging which

As team, met each we measures means, a of we stronger and five what set leadership them. have of

we market pre-COVID? reminder, a HX as when market compared in share to grow of as Xx grew And we our basket companies. the than Xx Check. the at faster First, We HX. did market market, approximately traded we say to referring were in publicly

proxy in did would execute as our HX which crisis, our despite role be Second, big enhancing on the Check. deal transformation a pipeline trusted we partner? for the

of In clients HX of fact, million we year. more $XXX HX X bookings to this in with over compared had

capture new we opportunities? did growth Third, Check.

of new our clients. had are the doing training in such we Not invest which cloud, of did our sector, as some public and to our Check. on in offset are U.S. pay in only tracing health digital people? meaningful for in the and 'XX. bonuses the our hours, and performance have where fiscal year for Fourth, our our and severe preserving expansion planning continued 'XX we margin commitments? so the we this, deliver our future the fiscal security, and to to the we level significantly year substantial in Check. promotions modest We of investment And for year management-related ourselves and services significant model performance we well that manufacturing, our created business XX usual remote a capacity while 'XX people also also chain exits our our business as business structural in bookings supply in positioning finally, workforce X% invest did as we continue through costs of distinguish us states around shareholder new upcoming our but and contact we for reduced of increase in collaboration impact level year each we helped And portion promotion December continue fiscal of on took And did to a believe, our cycle. accelerate consistently are all talented fiscal fifth, competitors. growth from our will

on to FY anticipate at singular group speed needs act cloud-related you details power with professionals XXX,XXX cloud new of the then on and XX,XXX and than we our brings Accenture gives ecosystem full a want which an investment which value more KC Accenture's Last investments touch of clients' Accenture more Cloud creation multiservice client scale. breadth Cloud the to is outlook, employees their with be and capabilities, for people at Before greater at with which will billion of a providing how First speed upskilling of I funded our Accenture first, 'XX industry time. and critical the the stakeholders is to example $X week, enabling technology announced prioritizing responsible expected by and First and over together business. X to years, move services, deep organizations we this Cloud the of commitment achieve and partnerships and to cloud focus business greater across all

become capabilities ongoing FY that are the for business. dramatically through recognize in been positioned cloud foundation have last experience a societal in initially and Services the $XX our company a in replatforming with digital products, of on to that important central digital created focusing and capabilities, works entire manufacturer cloud-first sales; from of XX%. for growing to today's global future common new system inflection our working of 'XX, on to cost which leader point our Enterprise Salesforce; the on COVID-XX ServiceNow cloud SaaS First a focuses a to build operations enhancing Oracle to and business. S/XHANA, chain cloud-based working working This consumer research Resources building has revenue to to drive requires replatforming And all backbone Platform transform Intelligent every higher a a requires crisis a U.S. from deployment wins their is the business Cloud implement real-time working the platform for critical. that the with to and move new "once cloud purchasing an education for that Force powered part bank on strategic a and Accenture to new institution transformation and include the requires. accelerate a Planning as quickly and which health, the demands well leadership their and with building by for SAP Air every supply Services, XX% office goods us their capabilities, which billion our customer approximately are partner across global cloud a another massive China Platform speed in that leading become a approximately finance the This Recent seamlessly infrastructure SaaS HR global its the with reduction includes to a integration trust, Workday program; businesses. with Intelligent our digital digital a business, We delivered establish with of is data decade direct-to-consumer and organization. that top double era" relationships a is capabilities better digits, economic analytics new front for Post-COVID resilience, structural moving

a for access health implement solution, ServiceNow services we agency, service safety rapidly while of dynamic millions complying government to example, with guidelines. cloud-enabled For with pandemic citizens collaborated a to enabling workflow public

over KC. Now to you,

Kathleen McClure

Julie. Thanks,

filings. like given not number as able accurately predict, the in that turn quarterly into as coronavirus the that of the impact, I our I outlook. of pandemic, get most business that did recovery we now said, to would I last pace the quarter, let may magnitude With you factors including our and described recent our those are of to me remind duration business a be as to well Before outlook, there

revenue negative X includes to also from first an X% costs. reduction local billion. assumes impact currency $XX.XX the reimbursable about flat reflects in first to travel range It the quarter and $XX.XX positive be billion a in This approximately the of of For X.X% FX compared will quarter growth of to fiscal estimated 'XX, decline points of expect we the be of revenues a in fiscal a percentage to 'XX. from

currently in dollars on fiscal trending we the 'XX. have been be few will the fiscal the X% results of 'XX, our how rates last over the impact weeks, based year positive to FX For compared U.S. on assume full approximately

For approximately revenues the currency from local to negative from our we range a X% the of 'XX, X% full over fiscal on the X% first in in material A reduction and of our to points are based year. helpful key a 'XX, year reimbursable fiscal the half to in growth of the travel X% no the in guidance. impact in of expect be revenue decline half couple including that second understand

We with will growth HX in similar, be expect QX we low double ranges expect growth with our reconnect lower we high digits HX, and in QX of being digits. in range and will single higher to the

be For results. fiscal to operating 'XX to XX point XX XX.X% XX%, 'XX expansion we over margin, a to basis expect year fiscal

to tax in This to effective XX%. tax of compares annual rate our expect effective an range be 'XX. to rate XX.X% the adjusted in We XX% of fiscal

growth be to in per fiscal $X.XX or adjusted and 'XX 'XX to expect fiscal EPS to of year we X% range earnings the diluted For for $X.XX full over X% share, results.

the expect $X.X in the fiscal to flow billion. billion; flow and $X.X approximately to billion we range range For the free and billion in $X.XX to cash $X.XX to property of of $XXX operating be cash to equipment million; 'XX, additions be be full

ratio free of to Our reflects free a to cash net flow flow strong cash income X.X X.X. very guidance

we that, a so open portion $X.X our up cash substantial expect and to shareholders. dividends of return Finally, With our that committed it we can to take billion at as share through let's we returning to your Angie? questions. least repurchases remain

Angie Park

Instructions]. you instructions [Operator Operator, those on the KC. provide Thanks, for would call?

Operator

Instructions]. [Operator

line Our first come question JPMorgan. today from Huang of Tien-Tsin the will of

Tien-Tsin Huang

of a little change saw consulting sounds and year, I more operations strategy know bit It information wanted biggest gave to -- improved. rate the of the here. lot you services good I like exiting pressure. a

to based curious in to And industries half, and going nice and impacted I'm 'XX. outlook consulting you the I in So by that's consulting probably see on of on the your and strategy presume fiscal recovery all are the there. the at in a the comments over-indexed visibility strategy pandemic? some for second

Kathleen McClure

for Tien-Tsin, question. your Thanks,

So talk Julie let color. can consulting, on then growth what additional in me and see strategy some we about pass for and

that do look differentiation I the critical look to to continuing strategy held places they we expected the follow industries pattern because environment, market. really in from results, the at invest. this see our perspective, where and strategy as a see really that And strategy impacted and it if thing when in say And in right, an pressure highly at you're first So is does it it's consulting, where very we in would we actual the we consulting is consulting, QX. our in up and in came clients really similar are industry most Tien-Tsin, in we

industry Now quarter the consulting that terms an in dynamics seeing the of we're first in we recovery perspective the the and dynamics same half. with quarter, for see we strategy first from out growth, in in the pretty essentially see and and do But growth growth that in first of the half the year. in back we in fourth similar play the saw as should reconnecting quarter

to hand Julie just over it comments. me Let more for some

Julie Sweet

the what's and and rest XX% other kind think industries in of in and industries, of so sort business words, worked versus important I Tien-Tsin, so Yes. we're consulting strategy severe it's not with over-indexed et our cetera. of how -- in

about I I of said, that are As about these in right, think in talked then, as the I'll last consulting, you and companies talk deals, and now huge differentiator right about focused. minute. quarter, a transformational very a when leading And it's strategy sort

and you we're are doing do, start of focus that smaller incubate companies sort So right. would do telling you to things, work to need the some saying, companies, on and rocks to of that the big

the how It's out about strategy they in a and in and playing what's need. consulting. sort businesses weakness our so their isn't reflection thinking clients market about And are of of what a

other is the pleased of require and holding that's consulting places. delivering understanding And this that I'm with bookings, and strategy important clients in up. XX industry how with actually you thing of we're transformations, this how So these $XXX over quite see like, most And deep functions. the big well each that is million is because

helping innovation, resilience example, announced before deal the support huge payments right. with For their crisis. there the we're and of infrastructure Bank were where to high-value a Digital payments and we England, them payments instant

the As dramatically. come And risk with us. new No customer of changed that, the being as data because next understanding things you cross-industry used, and are do of know, the resiliency, improves data those have create industry, to all experience, that skills right, together understand technology, access to right, in end-to-end question. those can as we Maybe this and but how Anything? well one we it's system digital expertise payments management.

Angie Park

Next question is from Lisa.

Operator

of Lisa MoffettNathanson. Ellis

Lisa Ellis

Yes, the environment a little consulting related like, and meaning, on about are that things? Like a looking bookings to leave of and seeing but Can bit very follow-up their down more have about in then in a to little following just what clients new, of kind these I'll of -- follow-up. a Tien-Tsin's kind quarter, in I I question commit is side is current strong. guess well, revenue a it what's up willingness strategic environment? commit you bit the -- to on talk on there, current you obviously, the on consulting. then question projects consulting the

Julie Sweet

most just you I've much then services of about and as and separately. the industries, really consulting example guys together. including we of let and But about again, me technology operations energy. severely and all I Lisa, think consistently, give impacted fact, the an But our one of strategy So you in very and know said pre-COVID, think

to create helping some I'm in much, this: major next So team accounting of is what they thank leadership the our last and of pressures. of with -- and is, the we meeting the clients, QX, one all we save Accenture, right, IT the The meeting and week, about includes help and their that the for like cost operations lowered our meeting goes first needed Then part strategy It very us them money you the finance signed because which about of around the that those during consulting. part CEO includes it's with strategy faster. to them build services, with meeting that moving turn criteria And the digital the is to third It's -- application they need consulting, they with And are -- pilots that outsourcing, maintenance. part that technology trying capabilities. it by we cloud. but Then cost, we're them where need shape other the because to have some about -- was to the continue and includes also -- include about driven to them it's right. their was of core, creating it's helping modernization

we're So right, them there's criteria say got return, they've about to right. should more do because the that small helping pilots But we balance, well innovation, will get right. is, what all

nearer-term how thinking? again, transformation needs very of bring these that the also in how do of services as that short their are innovate terms Does we their this they're think we and help together deal longer-term about get quickly they term, So the can returns. what to to and how bring client with of about thinking kind

Lisa Ellis

like we very times bifurcation and seen for are Yes. single kind really the to Yes. And question. those the industry. IT think And then of been that their you we high of in seeing every day in historical flattish of question Internet, Accenture, is my in follow-up, kind terms -- know And at given right all this Do running the the because that enterprise the times to similar we're personal you're the digits. given scale, GDP. that big the typically disruption always been meetings computers, have GDP of kind technology like side: we've of this and and of when at digital of is whatnot. this in on industry sort -- again is I a looking we're bellwether day. running dislocation impressive history in history on is Do investments broader as feel feel you're like a a And revenues, at because your is you there's shift level kind a looking level which of technology? down between mid- of those when sort of or But spending change now happening to situations pandemic client

Julie Sweet

we every business. exactly exponential big inflection happening. Because it right. that digital the that's first we in were in what's XXXX crisis, point. I talking Remember, remember, business was about said a Lisa, And mean, is before change, there just technology back was January, Yes.

you we is done these to we challenging era" us, years. would when invested XXXX well having is "once think last digital first created Accenture thought macro are five is think week, a why happening moving It say, the right. take what is was rapidly So decade. business, because a in we in do has helping what's where -- COVID more What moment shortened right, digital complete we Cloud pre-COVID. we this so as it of It's First announced replatforming capabilities incredibly difficult we why this global a significant. to in now that's hugely since now environment. And like that That's

Angie Park

Lisa. you, Thank Great.

Operator

We'll of go line to Jason next Bank America. of the Kupferberg of

Jason Kupferberg

upfront. I'll a I kind question, of just two-part it maybe so ask had

if premium in corporate rate it the up in relative New" we we in than the here single "the the at quarter. to low growth was of QX, there digits, look a it Just was growth and overall saw growth last less

in get that expectations. a your you sense you're can So bookings outlook fiscal consulting And across of outsourcing, especially And just the how converting 'XX. like factoring in pace the to not half terms more the seeing line I to first of then of for thought was just wanted your into what and revenue? whether broadly or with comment in process, of that's

Kathleen McClure

Yes.

me cover Let first question. the

growth hold had it the of in we terms came In New", really it "the so right. expected, did of well, very and up as

of the were where X, XXXX, to back in you it's a digital in, in pace about business. XX% with And did we it's has sure our when put when we now talked "the we everywhere. that were change. resilient the in point that is if our we and now through this look and we about well "the And of remember, New" XX% this to it make remember we you when go So talked was New" really business. the of us what we then -- X/X new able our provided strength embedded of that really at of March model growth which And business, position in of

the So that's core business. of now all our

into how be. feel bleeding good of did our the in expected are "the positioning things we to we we So it around how kind New." looking in that revenue? more, bleeding just into are of is at the our -- our terms first, in bookings I And your cover So question So about maybe, let very think come in second on question terms where bookings mix. me overall, of

what in in the of mentioned and operations very expected. which and strong lower if So strong in the very at you strong I very look which we we're bookings, quarter, consulting, $XX in mix fourth strategy bookings tech, billion of selling, was

overall our So of that and bookings be given mix the a are the the longer. bit lower they bookings of consulting, are percentage as our to little shorter, know, duration of strategy you and tend

coming I it's to think bookings you start been at when to important going when think COVID about into our take going our to it's since in So a and into really what's start when our it's and business hit. look revenue coming happening revenue,

right? from our at in lows, when range. our impacted, we improved we talked where QX, May. about in And and guidance pleased April our we really that expected And came and So within those were business hit as we in lows we we very

revenues. Jason, also, that have from X% We reimbursable headwind

has a in impact also So consulting. X% that

to bit QX unusual said, -- very see to of on our we out the the But based on provided. the out play QX, very also dynamics growth. more little just feeling that we guided QX HX that the build similar range in beginning that we very going in will part our QX, played similar to impacted year. in similar in that's more back out being business playing to that continue higher we and industries very saw, third thing a that in pressure unique So is to the That's XX%, situation. the -- about remember we And talked and we where

through end, negative guided the clear, QX in half -- that stability continue build we to the that anywhere -- else we stability So be and for QX, the year. again, X% in of implies X% of at back the from build range. that the bottom just to in QX to the at see first growth had happening improvement range And the very we

Operator

go next Deutsche of line the to Keane We'll Bryan of Bank.

Bryan Keane

way. different is me the kind dropping of between high let other in of strong pricing maybe a a in amount strong, was revenue. had company's are in the renewals ask I And quite there biggest, is history. gap that I'm Because about And currency, and it I question, dichotomy in down recall, up potentially but X% and The similar factors constant but QX, revenue bookings, it so thinking X% bookings translate there. a any doesn't to so is cancellations. then there's

you the quarter dichotomy, on for maybe about that. thinking the comment Just itself, can

Kathleen McClure

me the just going just want to to connecting and question, let And I -- line revenue and of, the Yes. top about Bryan point I'm okay, your growth. take, just take talk bookings

his bit little I was duration So talked when a I on with the about talking Jason question.

connecting revenue just me back we all stepping let kind bookings it So out round how growth. of at these of by to and looking see

I've continue touch -- playing build that see QX. touched did we're build the back business. how to to and QX And how in So a happened in where already going our and in May what April we from back on we out, I on quite bit HX,

and to start going coming Bryan, those you're So QX see bookings, QX. back into

But are business. bit similar a rates we our your little Although to in going let growth be it's the bit because talk little second our the a get building just range, bookings. question about half, back are probably more going on to me to

growth half expect do at end different 'XX, higher dynamic for So there At half. And with this in high the with connecting we we end, And are growth see our second higher bottom the the in main digits. really when the we digits. growth. higher-level X to growth, it's fiscal reconnect range, we and a single back low of double top see of drivers that say that's

we in have macroeconomic assume some environment, don't the So we that so shock. first macroeconomic the expect another improvement is do assumption doesn't -- which we

half gave think expect coming in over Julie thing benefit that's the of the question And is, in second significant I then the the just more point that will is will last that that consulting that on in with fourth growth. the transformation of back back have second we that And half is, half. then why color the third gets terrific it we few the is of quarters to see in your at But we we point the see benefit the a of when all point The headwind. to from an out I of we we couple just reconnect the We're this anniversary same see, to you deals year, year. the know, going sold the revenue of to back as the strategy things. time, and with And reimbursable compare. want easier that,

this only of been X% that's to So in less we that, as we but anniversary travel of half clients. the will not our have reality adjusted the first new But have year.

client and, does So we we with returning but some yes, travel. include course, revenue are sites, are to clients, meeting significant of assumption increase in our HX not a

of to to inorganic that the X% top picture in, come a how with the in $X.X our billion the gives And contribution you for for play, year, will fiscal continue that 'XX, connect when ranges aligns about kind guidance, of they're full current in and we our and full spend, growth the quarter the we to HX. strong along level one going I on acquisition based of going in growth. our which bookings drive line So while to are want with of to for shaped say environment, how all come

going 'XX. at of a low digits growth, believe second about the that can in on you and strong of in an really our guidance. impact the the which if year, that as is FY to in impact growth of fiscal We're pandemic, HX the this, end look HX at our up half turning by building we're was implied is talked And high connect we the of characterized level So of it of consider year Julie you least 'XX page, business. with single back the

Operator

Our Shirvaikar line Citi. next from of question will come Ashwin the of

Ashwin Shirvaikar

directionally the And on thank said. you a essentially finer it, we comments, don't I and what points if pretty clarification with So Good maybe good regards of put for with the want results. just you to couple trajectory. to consistent mind. results just

is basically in to of all demand do essentially you do saying something to to those kick fiscal takes just because the in that X seeing of calendar that. over of the already plan for over "the X The is a are in nailed more next reality? potentially move X that from do and clarification that just years step-up projects right back. to by elements, 'XX with Or it budgets then consultants you're large expect enterprises clients one can time clients, X, year, thing? to conversations, of building, not on down New," you're terms of on your that on meat So like years, when for it pipeline a it traveling come the Is new bookings,

Kathleen McClure

Yes.

So question question, then over let a first and hand me take the on just Julie. last point the it to

and me terms how 'XX. in So we demand maybe pipeline FY see first of Ashwin, a let point question, in about so talk our on your bookings

year, bit even So look that's QX. just the see we throughout we how year, out from say do I going a at this is assumption the travel. into play coming in building lighter about of as strong what the which in of year, doing our we then that pipeline the half just to on is, want QX back after bookings And would $XX on pattern. be a over the have point, the talking what the and have to little headwind the in billion I And revenue year. last I on have been clear typical we made revenue We've being

uplift be to clear that wanted assumption in the assuming we are an that making just of year. back the about half I'm really in I the not revenue So

Julie Sweet

of we've headwinds going Yes, the we're but like still terms to of saying, HX, we're get compare. to the on. sunsets. hey, It's an not just the which got in course, uplift. means, going We're get But

Kathleen McClure

in. not I'm uplift any baking

Julie Sweet

have that saw what's on got how just and last these right, things bigger the be of an -- it is you do conversations demand you you've immediately, It things. quarter. We're we're shape could we're clients lot doing. upside, then a right have XX now right, bigger that doing Ashwin, but in you certain happening these there's That's side, continuing to

for with pharma example, get chain, it's immediate like you If needed had because a that they take client, client help to forecasting PPE. supply one

the incredibly transformations, HPE, do as We're of and oftentimes on the as what forecasting, hyperscalers doing the worked leading with transformation an get important in, with Accenture SAP by an we're Hat, VMware, critical doing supply health working Blue the this. same transformation management analytics, the for we're They immediately getting Red transportation entire to Yonder chain. quickly of Cloud public planning, which to the shape business hybrid time that world, in about the doing And partners we're in talking needed some immediate well, while of we care issues build Ciscos and shortages, things, the where broader That's But way, Same put chain right. we're critical data with talking -- we are the a system, at cloud who quickly places. help about partnered decrease and integrated shaping conversations. resilience, but everywhere, we're to put to personal supply a cloud, these hyperscalers well First. bigger ecosystem So to the agility of we working the company. with as the to to goods have as we're that's the different larger address partnerships shaping kind a right. That's the thing while happening the about shaping we why

Ashwin Shirvaikar

then to but strong a conversion Got know And the always has pretty projections be next year. solid these still cash on -- for it. point quite of levels been cash And in impressive. continues It's flow for cash second good I the question look flow. Accenture, quarter, are

related to is sustainable had factors to single changed? like this comp? I perhaps variable level? So at ask, Is it lower it Or something has

Kathleen McClure

Yes.

free cash So question flow. the thanks for on

right, record that? billing to $X.X even it stellar of free cash is our year. flow why year, and in we year. You're And billion Really, had surpassed the expectations just for this the I due mean and it's collections

we know right. have you So industry-leading DSO,

know You well. us

levels right, XXXX. during we're And haven't since those we We we which pandemic, a is days. -- crisis, fiscal days, days, usually did so seen during closed XX that right. So all at XX liquidity either around XX

income very just goes I it's and think that rigor how And So team run And business. to the free the we net a cash was and to discipline our just ratio. impressive. X.X it that flow has

we flow. to cash do used you're free Ashwin, So how guide

know You did this see give range what we all we is our our And typical decline. for the decline And to end how just year. it's you of have bottom we last of what in want that a context you strong And be year over just this. perform. some ranges I to

still it's is days when to least The five back ourselves that $X a DSO. back free you flow almost of cash change we've at industry-leading As know, days, that's of getting five XX to of in back it's that plus and to DSO, billion, way is into go flow, million days cash we added like works just get change what $XXX free level.

management still is to cash stellar nothing there's just free cash and other superior what than year this So year. back going next flow

Operator

to of go next We'll the line Stanley. Morgan of Faucette James

James Faucette

Just two quick questions me. from

seeing and related those. around lot any wondering decision First, we've can we're any looking in provide second talked cycles customers Accenture. what those they're about is for and But color And with engagement you my the question a what are to to from et of times seeing terms If contribution. improvement, inorganic as cetera? if

some all for once level that more year into again contribution Can is built and guess I clarify type into of persist about we inorganic should importantly, that contribution doing mentioned like? change the of as your you your think looks of we the the clients, And guidance. you're expecting fiscal level inorganic think you I beyond work to just you're 'XX? future expect that what

Kathleen McClure

for question. So thanks the

of we we the -- contribution our for part year, I'm take -- spend. just X% $X.X to guide allocation. what into into years obviously, But So capital confirm future and billion the next have won't revenue do to with in don't inorganic I'll is D&A we're key up clarify factored terms a going do. -- that of just guidance not our of

approach. at hand it to I'm our changes to planned capital about a And talk no color. all to bit any over little have other going allocation We to Julie

Julie Sweet

the is fast you'd to Everyone really decision-making, in had Yes. Look, decisions right. the how happening what navigate crisis. what's expect on to to happen, make

things things, in get they're have there right. chain seen that. right, that Teams supply fast, So you the happening speed, or to we are lightning at you figure some are We've on up transformation acceleration like, some When deals, of and other your clients move kind see out got do they then because And where one these to you do let's to faster had up, have and things slowed on down three wait like, that. others. get where they're teed places and to we this let's

And so the into right and you of very of it I it's season. note, now we're now just due would also course, say fall -- normally And end kind budgets going industry. varies by the the of for contextual in as

will that plays see So that well. will be how out we'll as -- that and --

Angie Park

wrap Julie more Okay. and then the Operator, question, have time we up for one will call.

Operator

of And come Cowen. Bergin line . the of that Bryan will from

Bryan Bergin

for I you. just got one here

And that? your play range? thinking we about your how should expansion also how may be implications level on margin comment comfort in So work-from-home can into margin, typical you

Kathleen McClure

Yes.

So question. thanks for the

And to at with expand year fiscal 'XX even our -- while business key of our margin saw, investing revenue lower is this, people. So obviously, imperatives modest expansion in one our we in and did give financial ranges Bryan, of growth. you in scale

the the our can to that business. to investment, comfortable continue about we and do excited feel we First. create quite a Julie the the Cloud in investments do we bit are in so in talked to investments And how flexibility talent,

capacity, that need invest to say XX to keeping would rigor our expansion. discipline points basis bring create XX we to and it's margin I normal our while back within to the that to of So business,

Julie Sweet

the remote that's Yes. work new going working going about and but on from And I be to reality, differently, on -- -- to right, evolving. constantly it's home, we're the be talked

back example, travel. the encouraging at approving we've come clients We're worldwide, clients. We're our our respect about got people collaboration. doing the X,XXX with for to to offices into to So back where people are

issues, because is restricted right. where and going to who the issues, go you're some got that place We've quarantining. Now it's people massively reality, who've got you're not to health childcare have a

able we're going we're that. navigate that. reality. really of continue where so But remote were the is being to at to And this, so that that's we about And already all navigate course, good new to

Bryan Bergin

for it you X% fiscal -- X% was or X% as Okay. inorganic that And KC, said Was well? fiscal 'XX. in 'XX

Kathleen McClure

Yes. It was 'XX. X% in fiscal

Julie Sweet

Great.

our shared special Be partners 'XX. our in communities call and for continued your come people shareholders, success well, to you a on and deliver to a these success, thank FY and turn together and page thank it and commitments our deliver and for day. We for we're you is live the shareholders excited this clients, leaders shared how Thank ecosystem to support. to So trust mindset we people, every joining. to for strive everyone, and you and you

Operator

And and available today's midnight. gentlemen, today ladies you. will Eastern Time, conference after Thank a.m. for available be replay, XX running at December through XX

today. our your AT&T XXXXXXX. Thank dial conclude XXX-XXX-XXXX. participation system using for replay That for may entering Teleconferencing International of does for you dialing Services. the X-XXX-XXX-XXXX conference participants code access by access may the and and You

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Accenture (ACN) 24 Sep 202020 Q4 Earnings call transcript