Accenture’s Q2 performance signals AI-driven growth for Indian IT firms

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• Accenture Q2 revenue grew 8 percent to $18 billion
• AI-driven demand fuels steady growth outlook for IT services
• Indian IT firms expected to see similar steady growth

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Information Technology (IT) services giant Accenture’s Q2 results indicated a steady growth outlook led by artificial intelligence-driven demand despite macroeconomic uncertainties. Industry analysts expect Indian IT firms to ride a similar wave, but cautioned on gaps in execution could determine their growth compared to their global peer.

The Dublin-headquartered firm’s management said it is seeing clients increasing spending in newer areas, taking up larger AI programmes.

AI will be a tailwind over time that will help Accenture grow market share, Chair and CEO Julie Sweet said during the earnings conference call on March 19.

According to Phil Fersht, founder and CEO, HFS Research, Accenture’s results point to a stabilising market, not a rebound.

Growth was mainly fuelled by smaller, AI-led and cost-focused deals, while large discretionary programmes remain muted and sales cycles are still long.

“This is the same environment Indian IT firms are operating in, so expect steady but unspectacular growth, continued pricing pressure, and margins supported more by cost discipline than expansion,” he said.

“The gap remains in execution, Accenture is further ahead in scaling AI into revenue, while many Indian firms are still converting capability into consistent growth,” Fersht added.

However, Indian IT services firms have been battered at the stock markets owing to AI fears after multiple product announcements from Anthropic inclusing Claude Cowork, which several industry experts predicted could impact the future growth potential. While the concerns remain, the results indicate that it could be overblown and the downside could be limited.

“Accenture results augur well for Indian IT firms. However, Accenture is rapidly changing its operating model unlike Indian IT firms and therefore, direct comparison is misleading,” said Yugal Joshi, Partner, Everest.

How did Accenture fare?

Accenture reported revenue of $18 billion in Q2, growing 8% in US dollars year-on-year. The company follows September to August financial year.

New bookings during the quarter increased 6 percent YoY to $22.11 billion, with consulting bookings of $11.33 billion and managed services bookings of $10.78 billion.

This is the third consecutive quarter of $20 billion-plus in deal bookings.

The company also raised its full-year growth guidance to 3 percent to 5 percent, compared to its earlier projection of 2 percent to 5 percent.

Sweet said, “We saw again this quarter clients continuing to prioritize their most strategic and large-scale transformational programs which position us in the center of their reinvention agendas.”

“As clients finalised their budgets going into calendar year 2026, we are seeing spending similar to 2025,” she added.

Ashutosh Sharma, VP and Research Director, Forrester said that organisations need to get ROI (return on investments) from their AI investments. "A continuous improvement in AI capabilities is giving organisations a lot of confidence that it can impact their business positively,” he added.

What’s in store for Indian IT?

Accenture's performance is widely regarded as a benchmark for the Indian IT industry, providing a glimpse into the expected outcomes for Indian IT companies.

Given that a substantial portion of Accenture's workforce is based in India, its results often serve as an indicator of the broader trends and potential outcomes within the Indian IT sector.

All the top Indian IT firms including Tata Consultancy Services (TCS), Infosys, HCLTech, Wipro and Tech Mahindra among others are set to announce their fourth quarter earnings next month.

Fersht believes Accenture raising the lower end of guidance signals confidence in resilient demand, especially in North America and in AI, cloud, and data programs that are now viewed “as essential, not discretionary”.

“Enterprises are reallocating budgets toward productivity and AI-led transformation rather than increasing overall spend,” he said.

DD Mishra, VP analyst at Gartner, highlighted Accenture’s evolving business model as it recalibrates towards a technology-driven, outcome-focused model, combining consulting expertise with new product offerings and upskilling its workforce.

“Key growth areas include agentic AI, cybersecurity, and cloud services, with cloud revenues reaching historic highs and security services expanding through partnerships and innovation,” he said.

Industry analysts see more AI-focused work coming from North America, that accounts for over 60 percent of Indian IT’s revenue.

“Indian IT services are poised to take advantage of that demand. So, we expect that 2026 will be reasonably better but that's with the assumption that this war comes to a close sooner than later,” said Sharma.

Will West Asia war impact Indian IT?

While Accenture said it isn’t worried about the Middle East conflict as it won’t have any significant financial impact on its revenue, the company is still cautiously optimistic.

Fersht said, “The limited concern over geopolitical impact reflects how enterprise tech spending is currently anchored in efficiency mandates. That said, this is cautious optimism, not a growth inflection. Any escalation in energy or macro volatility could still pressure discretionary spending later in the year.”

“Middle East is not a big market for Indian IT firms unlike Accenture and therefore, they should be even less impacted,” added Joshi.