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Analyzing Accenture’s Geographic Performance

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Oct. 4 2018, Updated 10:05 a.m. ET

North America performance

Accenture (ACN) witnessed strong growth in various geographic regions in the fourth quarter of fiscal 2018. The company has generated strong business from most of its largest markets. The company expects this trend to continue in Q1 2019.

The North American region, which on average contributes ~45% of the overall revenue, increased 11.3% YoY to $4.7 billion. However, the soft business from its US unit has to some extent offset revenue growth in the North American location. The graph below shows the revenue growth from Accenture’s North American region in the last five quarters. During the period, revenues grew at a CAGR (compound annual growth rate) of 2.7% and were in an improving trend.

In comparison, Oracle’s (ORCL) revenues grew at a CAGR of 2.1%, and IBM (IBM) reported flat growth in the last five quarters in the North American region.

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Growth in international markets

The company’s European segment improved 9.5% YoY to $3.4 billion in the fourth quarter triggered by double-digit growth in Germany, Italy, and France. Even Spain saw a high-single-digit growth in the reported quarter. The higher adoption in its cloud and security-related services, particularly in these countries, are supporting revenue momentum. Growth markets saw the most growth in the reported quarter, strongly driven by countries like Japan, Australia, Brazil, and Singapore.

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