IT Services & Consulting Stocks Q4 Results: Benchmarking Accenture (NYSE:ACN)

Let’s dig into the relative performance of Accenture (NYSE:ACN) and its peers as we unravel the now-completed Q4 it services & consulting earnings season.

IT Services & Consulting companies stand to benefit from increasing enterprise demand for digital transformation, AI-driven automation, and cybersecurity resilience. Many enterprises can't attack these topics alone and need IT services and consulting on everything from technical advice to implementation. Challenges in meeting these needs will include finding talent in specialized and evolving IT fields. While AI and automation can enhance productivity, they also threaten to commoditize certain consulting functions. Another ongoing challenge will be pricing pressures from offshore IT service providers, which have lower labor costs and increasingly equal access to advanced technology like AI.

The 8 it services & consulting stocks we track reported a satisfactory Q4. As a group, revenues beat analysts’ consensus estimates by 1.3% while next quarter’s revenue guidance was in line.

In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.

Accenture (NYSE:ACN)

With a workforce of approximately 774,000 people serving clients in more than 120 countries, Accenture (NYSE:ACN) is a professional services firm that helps organizations transform their businesses through consulting, technology, operations, and digital services.

Accenture reported revenues of $17.69 billion, up 9% year on year. This print exceeded analysts’ expectations by 3.2%. Overall, it was a very strong quarter for the company with a decent beat of analysts’ EPS estimates.

Accenture achieved the biggest analyst estimates beat of the whole group. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 9.1% since reporting and currently trades at $315.89.

Is now the time to buy Accenture? Access our full analysis of the earnings results here, it’s free.

Best Q4: Grid Dynamics (NASDAQ:GDYN)

With engineering centers across the Americas, Europe, and India serving Fortune 1000 companies, Grid Dynamics (NASDAQ:GDYN) provides technology consulting, engineering, and analytics services to help large enterprises modernize their technology systems and business processes.

Grid Dynamics reported revenues of $100.4 million, up 25.8% year on year, outperforming analysts’ expectations by 2%. The business had a very strong quarter with a solid beat of analysts’ EPS estimates and full-year revenue guidance beating analysts’ expectations.

Grid Dynamics achieved the fastest revenue growth and highest full-year guidance raise among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 10.9% since reporting. It currently trades at $12.54.

Is now the time to buy Grid Dynamics? Access our full analysis of the earnings results here, it’s free.

Weakest Q4: ASGN (NYSE:ASGN)

Evolving from its roots in IT staffing to become a high-end technology consulting powerhouse, ASGN (NYSE:ASGN) provides specialized IT consulting services and staffing solutions to Fortune 1000 companies and U.S. federal government agencies.

ASGN reported revenues of $968.3 million, down 7.7% year on year, exceeding analysts’ expectations by 0.6%. Still, it was a slower quarter as it posted a miss of analysts’ EPS estimates.

ASGN delivered the slowest revenue growth in the group. As expected, the stock is down 10.1% since the results and currently trades at $52.58.

Read our full analysis of ASGN’s results here.

Kyndryl (NYSE:KD)

Born from IBM's managed infrastructure services business in a 2021 spinoff, Kyndryl (NYSE:KD) is the world's largest IT infrastructure services provider that designs, builds, and manages technology environments for enterprise customers.

Kyndryl reported revenues of $3.8 billion, down 1.3% year on year. This result surpassed analysts’ expectations by 0.8%. Taking a step back, it was a mixed quarter as it also recorded a decent beat of analysts’ EPS estimates but revenue guidance for next quarter slightly missing analysts’ expectations.

The stock is up 18.3% since reporting and currently trades at $39.19.

Read our full, actionable report on Kyndryl here, it’s free.

DXC (NYSE:DXC)

Born from the 2017 merger of Computer Sciences Corporation and HP Enterprise's services business, DXC Technology (NYSE:DXC) is a global IT services company that helps businesses transform their technology infrastructure, applications, and operations.

DXC reported revenues of $3.17 billion, down 6.4% year on year. This number beat analysts’ expectations by 0.9%. However, it was a slower quarter as it logged a significant miss of analysts’ EPS guidance for next quarter estimates.

DXC had the weakest full-year guidance update among its peers. The stock is down 7.7% since reporting and currently trades at $15.30.

Read our full, actionable report on DXC here, it’s free.

Market Update

Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.

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