Accenture to lay off 19,000 employees in next 18 months
Accenture's layoffs will largely impact the non-billable employees and will span out over the next 18 months.
Accenture, the global technology consulting company, will lay off its workforce by 19,000—about 2.5% of its total headcount—as it looks to trim down costs in anticipation of lower demand.
“During the second quarter of fiscal 2023, we initiated actions to streamline our operations and transform our non-billable corporate functions to reduce costs. Over the next 18 months, these actions are expected to result in the departure of approximately 19,000 people (or 2.5% of our current workforce)," Accenture said in its filings with the US SEC.
Accenture, often regarded as the bellweather for the IT services industry, expects over half of these layoffs will consist of people in its non-billable corporate functions.
The company had a total headcount of 738,000 at the end of the second quarter.
It also marginally lowered its revenue growth guidance for fiscal 2023 to 8%-10% from the earlier 8%-11%. Accenture made these announcements during its second-quarter results for FY23.
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Accenture reported revenue of $15.8 billion for the second quarter ended February 2023, a 5% growth in US dollars compared to the similar period last year. However, the operating profit margin contracted to 12.3% compared to 13.7% a year ago.
The company spoke of a difficult economic environment, where the majority of companies focused on optimising cost, which would mean lower IT spending.
The financial performance of Accenture will send negative signals for the Indian IT industry, which will start reporting its results next month. This could result in muted hiring and lowered attrition as the sector looks to tide through the crisis engulfing its key markets—North America and Europe.
Edited by Suman Singh
