Accenture (ACN) reported mixed fiscal third-quarter results. However, the company’s stock surged in pre-market trading as investors focused on Accenture’s raised guidance.ACN depositphotos Accenture (ACN) reported mixed results for its fiscal third quarter, falling short of analyst expectations on both revenue and earnings per share. However, the company’s stock surged in pre-market trading as investors focused on Accenture’s raised guidance driven by strong demand for its artificial intelligence (AI) services. Accenture Misses Q3 ExpectationsFor the quarter ended May 31, 2024, Accenture posted revenues of $16.5 billion, representing a 1% decrease in U.S. dollars but a 1.4% increase in local currency compared to the same period last year.

The company’s consulting revenues stood at $8.5 billion, while managed services revenues reached $8.0 billion. Despite the slight revenue miss, Accenture’s GAAP operating margin improved to 16.0% from 14.2% in the prior year.On the earnings front, Accenture reported GAAP earnings per share (EPS) of $3.04, a 3% decrease from $3.15 in the previous year. Adjusted EPS also declined 2% to $3.13 from $3.19. The company’s actual EPS of $3.04 fell short of analyst expectations of $3.17 by $0.13.

While revenue of $16.5 billion slightly missed the expected $16.6 billion, it remained within Accenture’s adjusted guidance range. The company’s new bookings were a bright spot, reaching $21.1 billion, a 22% increase in U.S. dollars and a 26% increase in local currency. Accenture Ups Guidance Based on AI BusinessLooking ahead, Accenture raised its full-year fiscal 2024 revenue growth guidance to 1.5%-2.5% in local currency, narrowing the previous range of 1-3%. For the fourth quarter, the company anticipates revenues between $16.05 billion and $16.65 billion, translating to a 2-6% growth in local currency.The upbeat guidance is largely attributed to Accenture’s strong performance in its AI-related business. The company reported over $900 million in new bookings tied to generative AI in the third quarter alone, contributing to a total of $2 billion in AI-related bookings for the fiscal year-to-date.

Accenture’s significant investments in AI are paying off, as the growing adoption of these technologies helps offset slower enterprise IT spending. Generative AI solutions enable Accenture’s clients to enhance productivity and reduce costs. ACN Stock Gains in Premarket Trading Session on AI-Fueled GuidanceAs of the June 18, 2024 close, Accenture’s stock price stood at $285.35, down $0.18 or 0.06%. However, the stock surged in pre-market trading, reaching $304.02, a gain of $18.67 or 6.54%, as investors reacted positively to the company’s AI-driven outlook.

Accenture’s market capitalization currently stands at $179.408 billion, with a beta of 0.92 and a trailing twelve-month (TTM) P/E ratio of 25.87. The company’s TTM EPS is $11.04, and it offers a forward dividend yield of 0.51%.Over the past year, Accenture’s stock has underperformed the broader market, with a 1-year return of -9.33% compared to the S&P 500’s gain of 24.43%.

The stock’s 3-year and 5-year returns also lag the benchmark index, at 4.57% and 66.30%, respectively, versus the S&P 500’s returns of 29.97% and 89.88%. Year-to-date, Accenture’s stock is down 18.07%, while the S&P 500 has gained 15.04%.More By This Author:These 3 Mid-Cap Stocks Have The Most Potential To Become Mega-Cap StocksWhy Meta Is A Dark Horse In The Current AI Market Cycle 3 Bitcoin Mining Stocks To Hold As BTC Becomes More Mainstream