Accenture’s results offer a window into the demand outlook for Indian IT services

In the global IT services industry, investors often rely on large multinational players for early signals on demand trends. Accenture, with annual revenues of around $70 billion and a diversified client base across industries and geographies, serves as one such bellwether. Its latest quarterly results, covering the September–November period, provide useful clues about the state of enterprise technology spending—and by extension, what Indian IT services companies might expect in the coming quarters.

Accenture reported revenue growth at the top end of its guidance, supported by steady client spending and resilient deal activity. Revenue rose 6 percent year-on-year to $18.7 billion, reflecting broad-based demand across regions. Growth was strongest in EMEA and Asia Pacific, while the Americas also posted moderate expansion despite mixed macroeconomic signals. Margins improved slightly, indicating that pricing discipline and cost management remain intact even in a cautious spending environment.

One of the more encouraging indicators was the strength in order bookings, which rose 10 percent year-on-year to about $21 billion. Managed services were a key contributor to this increase. This is particularly relevant for Indian IT companies, which derive a large share of their revenues from long-term managed services contracts. A healthy bookings pipeline suggests that enterprises continue to commit to multi-year technology partnerships, even as they remain selective about discretionary projects.

Financial services emerged as a notable driver of growth. Accenture’s performance indicates that banks, insurers, and other financial institutions are continuing to invest in technology, especially in areas such as core system modernisation, cloud migration, and data platforms. This aligns with recent commentary from Indian IT majors, where financial services has outpaced overall company growth in recent quarters. If this momentum sustains, it could provide near-term support to revenue growth for firms like TCS, Infosys, and HCL Technologies, for whom BFSI remains a critical vertical.

At the same time, Accenture’s management commentary reinforces the view that the broader demand environment has not materially improved. Discretionary spending remains under pressure, with clients prioritising efficiency, cost optimisation, and return on investment over large experimental projects. Seasonal softness is also expected in the near term. For Indian IT companies, this suggests that while deal flow is stable, growth acceleration will likely depend more on execution and share gains rather than a sharp cyclical rebound.

Artificial intelligence was a central theme in Accenture’s results and commentary. The company reported a sharp increase in AI-related bookings and revenues, highlighting accelerating enterprise adoption. Importantly, management indicated that advanced AI capabilities are now embedded across most client engagements, to the extent that separating AI-specific metrics is becoming less meaningful. This signals a shift from pilot projects and proofs of concept toward scaled deployment across business processes.

For Indian IT services firms, this has two key implications. First, fears that AI would be immediately deflationary for revenues appear overstated. Instead, AI adoption is driving significant downstream work in data engineering, cloud modernisation, application refactoring, and ongoing managed services. Second, the opportunity lies not just in building AI models, but in the extensive “rewiring” of enterprise technology stacks required to make AI effective at scale. This plays to the strengths of large IT services providers with deep capabilities in systems integration and operations.

That said, Accenture is widely viewed as being ahead of Indian peers in monetising new technologies at scale. While Indian IT companies have announced AI platforms, partnerships, and use cases, the revenue contribution from these initiatives has so far been modest and uneven. Upcoming quarterly results will be closely watched for clearer evidence that AI-led deals are translating into meaningful growth.

The stock market reaction to Accenture’s results was swift, with Indian IT stocks gaining ground in early trade. The rally reflects optimism that stable global demand and accelerating AI adoption could improve growth visibility for the sector. Brokerages have highlighted that large-scale digital core modernisation, followed by industry-specific solutions and long-term managed services, provides a long runway of work for Indian IT firms. Improving pricing trends in managed services are seen as an additional positive.

However, there are also reasons for caution. Accenture maintained its full-year revenue guidance, suggesting no near-term macro tailwinds. Demand from public-sector clients remains uneven, particularly in the US, and discretionary spending has yet to show a sustained recovery. Moreover, Indian IT stocks have already rallied strongly in recent months, meaning some of the optimism may be priced in.

Overall, Accenture’s results paint a picture of stability rather than acceleration. For Indian IT services companies, the message is clear: the demand environment is steady, financial services remains supportive, and AI is creating new opportunities—but execution will be critical. As expectations rise, the ability to convert AI-led deal wins into consistent revenue growth will determine which players truly benefit from the next phase of technology transformation.

Market this week

Source: BSE and NSE

• Indian equities ended the week flat amid heightened volatility, driven by continued FII outflows, sharp rupee swings, and uncertainty over the India–US trade deal.
• FIIs turned buyers in the last three sessions but still remained marginal net sellers for the week, offloading equities worth about ₹252 crore, sharply lower than the previous week’s heavy selling.
• Domestic institutional investors stayed supportive, with net equity purchases of over ₹12,000 crore, helping cushion market swings.
• The rupee hit a record low of 91.08 during the week but rebounded strongly to close at 89.65 on December 19, gaining 77 paise week-on-week.
• Overall market sentiment remained cautious, with investors tracking capital flows, currency movements, and trade-related developments

Weekly Leaderboard

Source: BSE

Stocks that made the news this week:

Ather Energy:

Ather Energy shares rose nearly 4% after its board approved entry into the insurance business through a wholly owned subsidiary. The new entity will operate as a corporate agent, offering auto insurance products in partnership with multiple insurers. The move aims to streamline insurance offerings, tailor products for EVs, simplify renewals, and enhance customer experience.

ICICI Prudential AMC:

ICICI Prudential AMC emerged as the second-best mega IPO of 2025 in terms of returns, listing at a premium of over 20% on December 19. Its IPO was subscribed more than 54 times, making it the most sought-after billion-dollar public issue since 2008.

Bandhan AMC:

Bandhan Asset Management Company has filed draft papers to launch its first Specialized Investment Fund under the new SIF framework. The proposed Arudha Hybrid Long-Short Fund will follow an interval strategy, combining equity and debt exposure with limited use of derivatives.