{"id":653537,"date":"2026-10-13T15:16:12","date_gmt":"2026-10-13T15:16:12","guid":{"rendered":"https:\/\/www.newsbeep.com\/ie\/653537\/"},"modified":"2026-10-13T15:16:12","modified_gmt":"2026-10-13T15:16:12","slug":"will-dublin-headquartered-accenture-survive-or-thrive-in-the-age-of-ai-the-irish-times","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ie\/653537\/","title":{"rendered":"Will Dublin-headquartered Accenture survive or thrive in the age of AI? \u2013 The Irish Times"},"content":{"rendered":"

In the space of three months, Accenture<\/a>\u2019s shares have suffered the steepest one-day fall and their second-largest one-day gain since the consultancy listed on the stock market a quarter of a century ago.<\/p>\n

The wild swings reflect investors\u2019 inability to decide if artificial intelligence<\/a> (AI) is an existential threat to the world\u2019s largest IT consulting firm or a once-in-a-generation boost.<\/p>\n

Investors fret that the technology will allow clients to replace consultants for many tasks. Accenture is betting that companies will desperately need its help to roll out the new technology.<\/p>\n

The company, whose market capitalisation has recovered from $76 billion (\u20ac68 billion) in June to about $130 billion, hopes it might settle the argument at an \u201cinvestor day\u201d event on Wednesday.<\/p>\n

Here are the metrics investors are watching as they try to assess Accenture\u2019s ability to reinvent itself for a new era.<\/p>\n

Organic revenue growth<\/p>\n

Technology shifts such as the introduction of cloud computing have typically boosted revenues for information technology (IT) consultants as companies seek help to adapt.<\/p>\n

But the dawn of the generative AI era has coincided with historically weak growth at Accenture, a slowdown partially masked by so-called inorganic revenues from acquisitions.<\/p>\n

\u201cAI is so radically different and transformational [from other technologies] that some companies are hanging tight on some of the bigger transformational work that Accenture does while they figure it out,\u201d said David Grossman, an analyst at Stifel.<\/p>\n

Accenture, which reported sales of $74.2 billion last year, has blamed economic uncertainty for the sluggishness. Companies have also diverted IT budgets away from smaller consulting projects and towards AI experimentation.<\/p>\n

\"\"Budget 2027: Does this giveaway budget have potential banana skins that might lie ahead for the Government?<\/p>\n

Some investors worry that organic growth could evaporate entirely because of the deflationary effects of AI.<\/p>\n

As the technology reduces the effort required by consultants, it may significantly reduce the number of hours Accenture can bill clients for. It has also raised clients\u2019 expectations about cost savings, potentially contributing to the pricing pressure the IT consultants have been reporting in recent months.<\/p>\n

\u201cSome of these projects with 1,000 people in India<\/a>, at some point your competition is going to come and reprice that to be 20 per cent of what you\u2019re getting paid today,\u201d said Nate Singer, chief executive of Heron Intelligence, a due-diligence firm that monitors professional services. \u201cYou can\u2019t infill with new business fast enough.\u201d<\/p>\n

Accenture executives lay out a much more optimistic view. They hope to secure years of lucrative work advising companies on how to prepare for AI, for example by improving the way clients manage data so they can use the technology more effectively.<\/p>\n

[\u00a0Accenture reports earnings of $93bn in Ireland, more than Apple and Microsoft combinedOpens in new window<\/a>\u00a0]<\/p>\n

They also argue AI will unlock new services they can sell, from transforming how insurance companies process claims to monitoring what AI agents are getting up to behind their corporate owners\u2019 backs.<\/p>\n

For its new fiscal year, which started in September, Accenture has hedged its bets, forecasting a modest decline in organic growth to about 2 per cent this year. Wednesday\u2019s investor event will be a test of whether the company has the confidence to make projections for growth further in the future.<\/p>\n

Revenue per employee<\/p>\n

Professional services firms\u2019 product is the expertise of their people. As a simplistic proxy, revenue per employee shows firms\u2019 pricing power and profitability.<\/p>\n

Now the metric is an AI barometer.<\/p>\n

The figure is being used as an indicator of two things: whether the new technology is making staff more productive, and whether firms are successfully moving away from hourly billing to supplement revenues with AI-related product, software and agent sales.<\/p>\n

Accenture\u2019s revenue per employee fell in the 2010s as it built its labour-intensive outsourcing services for clients. Impatient investors now want to see a step change in the other direction.<\/p>\n

\u201cIf you draw the conclusion that one of the main benefits of AI is that it makes companies more efficient, you would be hard-pressed to think they won\u2019t participate in that,\u201d said Kevin McVeigh, an analyst at UBS<\/a>.<\/p>\n

[\u00a0Consultants head for a showdown with their own clients as AI upends industryOpens in new window<\/a>\u00a0]<\/p>\n

The effect on overall staff numbers is mixed. Accenture ended August 2026 with a record 814,000 staff, despite two rounds of job cuts over the previous four years.<\/p>\n

\u201cYou would think headcount would decline, given the agentic capabilities [of AI]. Coding, for example, is 40 to 50 per cent done now through AI,\u201d said Bryan Keane, an analyst at Citi<\/a>. \u201cWe\u2019re just scratching the surface on AI capabilities in terms of implementing it through the enterprise.\u201d<\/p>\n

There are changes beneath the surface. Accenture\u2019s last job cuts were focused on people who could not be retrained to use AI, and the company boasts 110,000 of its staff are now \u201cAI and data professionals\u201d, almost three times the number three years ago.<\/p>\n

Chief executive Julie Sweet indicated that hiring will skew towards cheaper, entry-level staff \u2013 in other words, AI-native young people.<\/p>\n

\u201cThose entry-level people are well positioned to take advantage of the AI tools,\u201d said Jason Kupferberg, an analyst at Wells Fargo<\/a>. \u201cThe need for mid-level managers has probably decreased across the industry, so I think the shape of the staffing pyramid is widening out at the bottom.\u201d<\/p>\n

Cost of acquisitions<\/p>\n

Accenture has kept up with advancing technology partly by making dozens of acquisitions a year, adding specialist capabilities that it can roll out to its more than 9,000 clients around the world. When the pace of technological change is higher, so are the stakes. Often, so are the prices.<\/p>\n

Accenture is not alone in wanting to bolster its business in the face of disruption, intensifying competition for deals. Venture capital is also pouring into AI start-ups, raising valuations. Despite doing fewer deals in the past 12 months than in recent years, Accenture paid more for them overall.<\/p>\n

[\u00a0Accenture links top-level promotions to use of its AI toolsOpens in new window<\/a>\u00a0]<\/p>\n

Consulting firms are all trying to add more software-like products to the mix, such as AI tools they can sell at fixed prices that can act as insurance if their model of billing for human labour erodes significantly.<\/p>\n

In an age of AI agents, there is a blurring of the line between software and services, said Citi\u2019s Keane. Services companies will have to get used to paying the higher multiples typical of software companies in their deal making.<\/p>\n

\u201cYou have to pay up for higher, faster-growth acquisitions,\u201d Keane said.<\/p>\n

An open question is how those acquisitions will be funded and whether there has to be a trade-off in the form of lower share buy-backs and dividends, or higher debt.<\/p>\n

Accenture points out that the right deals can quickly prove their worth. In January, it bought UK start-up Faculty at a valuation of more than $1 billion. Last month, it said Anthropic had hired it as an independent evaluator of the safety of its models, using Faculty technology to help tackle concerns that AI was running out of control \u2013 and in the process illustrating Sweet\u2019s claim that AI will lead to entirely new kinds of consulting work.<\/p>\n

Accenture is \u201ca bit like the Borg\u201d, said Singer of Heron Intelligence. \u201cThey buy the thing that\u2019s going to be cool, and then they plough a ton of resources behind that. They can transform themselves. They can absorb the new hot thing.\u201d \u2013 Copyright The Financial Times Limited 2026<\/p>\n","protected":false},"excerpt":{"rendered":"In the space of three months, Accenture\u2019s shares have suffered the steepest one-day fall and their second-largest one-day…\n","protected":false},"author":2,"featured_media":653538,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[22534,220,218,219,178,615,61,2568,60,80,37660,115854],"class_list":["post-653537","post","type-post","status-publish","format-standard","has-post-thumbnail","category-artificial-intelligence","tag-accenture","tag-ai","tag-artificial-intelligence","tag-artificialintelligence","tag-citi","tag-dublin","tag-ie","tag-india","tag-ireland","tag-technology","tag-ubs","tag-wells-fargo"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/653537","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=653537"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/653537\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/653538"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=653537"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=653537"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=653537"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}