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Operator
Conference Call Operator
And ladies and gentlemen, thank you for standing by and welcome to the Accenture fourth quarter fiscal 2021 earnings conference call. At this time, all participants are in listen-only mode. Later, we will conduct a question and answer session. If you wish to ask a question, please press 1 then 0 on your telephone's keypad. To remove yourself from queue, please repeat the 1 then 0 command. If you should require assistance during the call, please press star then 0. As a reminder, today's call is being recorded. I would now like to turn the conference over to our host, Angie Park, Managing Director and Head of Investor Relations. Please go ahead.
Angie Park
Managing Director and Head of Investor Relations
Thank you, Operator, and thanks, everyone, for joining us today on our fourth quarter and full fiscal 2021 earnings announcement. As the Operator just mentioned, I'm Angie Park, Managing Director, Head of Investor Relations. On today's call, you will hear from Julie Sweet, our Chair and Chief Executive Officer, and Casey McClure, our Chief Financial Officer. We hope you've had an opportunity to review the news release we issued a short time ago. Let me quickly outline the agenda for today's call. Julie will begin with an overview of our results. KC will take you through the financial details, including the income statement and balance sheet, along with some key operational metrics for both the fourth quarter and full fiscal year. Julie will then provide a brief update on our market positioning before KC provides our business outlook for the first quarter and full fiscal year 2022. We will then take your questions before Julie provides a wrap-up at the end of the call. Some of the matters we'll discuss on this call, including our business outlook, are forward-looking and, as such, are subject to known and unknown risks and uncertainties, including but not limited to those factors set forth in today's news release and discussed in our annual report on Form 10-K and quarterly reports on Form 10-Q and other SEC filings. These risks and uncertainties could cause actual results to differ materially from those expressed in this call. During our call today, we will reference certain non-GAAP financial measures which we believe provide useful information for investors. We include reconciliations of non-GAAP financial measures where appropriate to GAAP in our news release or in the investor relations section of our website at Accenture.com. As always, Accenture assumes no obligation to update the information presented on this conference call. Now, let me turn the call over to Julie.
Julie Sweet
Chair and Chief Executive Officer
Thank you, Angie, and everyone for joining us. Before diving into our results, thank you to our 624,000 incredibly talented people around the world, including over 8,500 managing directors. This past fiscal year, your hard work and dedication to creating value that matters for our clients was unwavering, despite the ongoing and sometimes quite extreme challenges of COVID. We've had a truly extraordinary year, as reflected in our outstanding financial results and in the 360-degree value we delivered beyond our financials. From the over 120,000 promotions and over 31 million training hours, an increase of 43% for our people, to increasing our workforce by approximately 118,000 people, creating significant employment opportunities in our communities, to achieving 46% women on our way to our goal of gender parity by 2025, to our top three ranking in the Refinitiv Global Diversity and Inclusion Index for the fourth consecutive year, to the number one position with our largest ecosystem partners, to the exciting accomplishments of 50% renewable energy now powering our offices and centers globally, to the donation of $54 million in COVID surge relief. In December, we will publish our first-ever annual 360-degree value report to more fully describe the FY21 value we created in all directions, and we'll report against three additional key ESG frameworks, SASB, TCFD, and WEF IBC. We believe that the trust we have from our clients and partners, our continuous innovation, and our ability to consistently attract the best people, including the 56,000 net new hires this past quarter, are directly linked to our commitment to measuring our success by how well we create this 360-degree value for all our stakeholders, clients, people, partners, shareholders, and communities, and on our culture of shared success. Here are some key financial highlights of the year, which position us strongly as we begin FY22. FY21 demonstrated our leadership in helping our clients achieve compressed transformations. with 72 clients with bookings greater than $100 million compared to 53 last year, and 229 Diamond clients, our largest client relationship compared to 216 last year. With a 20% increase in bookings to $59 billion, we have strong momentum across all dimensions of our business, across geographic markets, industries, and services. Reaching revenues of $50.5 billion, a significant milestone representing 11% growth, we added $6.2 billion in revenue this year, gaining significant market share with 40 basis points of operating margin expansion, demonstrating yet again our ability to grow profitably and at scale. We achieved this profitable growth while investing at a higher level than ever before, with $4.2 billion in acquisitions, $1.1 billion in R&D in assets, platforms, and industry solutions, including growing our portfolio of patents and pending patents to more than 8,200, and total training investment of $900 million. And according to BrandZ, our brand value increased 56% to over $64 billion this ranking us number 27 on the prestigious BrandZ's top 100 most valuable global brands list. Finally, I want to highlight cloud and our ability to move with agility to serve our clients' needs and capture momentum in the market. At the beginning of FY21, after investing in cloud for a decade, we saw that the pandemic would dramatically accelerate our clients' move to the cloud. More than technology, the move to the cloud would be about the adoption of a new operating system for the future enterprise. A dynamic continuum of capabilities from public to edge to everything in between. Opening up radically new ways for companies to work, compete, and drive value. Just over one year ago, we created Accenture Cloud First to capitalize on this momentum. bringing together all of our capabilities from migration to cloud native development, data, AI, industry, talent, and change. Accenture Cloud First was the biggest driver of our overall cloud business growth from $12 billion to $18 billion, a 44% increase. Casey, over to you.
Casey McClure
Chief Financial Officer
Thank you, Julie, and thanks to all of you for joining us on today's call. We were very pleased with our results in the fourth quarter. which completes an outstanding year for Accenture and reflect broad-based momentum across all dimensions of our business. Once again, our results reflect our relentless focus to deliver across our three key imperatives for driving superior stakeholder value. So let me begin by summarizing a few of the highlights of the quarter. Revenue growth of 21% in local currency at the top end of our guided range reflects double-digit growth across all markets, all industry groups, and all services. We also continue to extend our leadership position at an accelerated pace, with growth significantly above the market. Operating margin was 14.6%, an increase of 30 basis points for the quarter, reflecting in 40 basis points of expansion for the full year. We delivered this expansion while investing significantly in our business and in our people to position us for long-term market leadership. We delivered very strong EPS of $2.20, which represents 29% growth compared to adjusted EPS last year. And finally, we delivered free cash flow of $2.2 billion, which was driven by continued strong growth and profitability. Now let me turn to some of the details. New bookings were $15 billion for the quarter with a book-to-bill of 1.1. Consulting bookings were $8 billion with a book-to-bill of 1.1. Outsourcing bookings were $7.1 billion with a book-to-bill of 1.2. We were very pleased with our new bookings, which represent 7% growth in U.S. dollars with 18 clients with bookings over $100 million. We were also pleased with the strength of bookings across all services, with a book to build one in strategy and consulting, 1.2 in technology services, and 1.1 in operations. Turning now to revenues. Revenues for the quarter were $13.4 billion, a 24% increase in U.S. dollars and 21% in local currency, slightly above our FX adjusted range, as the FX tail end was 3% compared to the 4% estimated last quarter. Consulting revenues for the quarter were $7.3 billion, up 29% in US dollars and 25% in local currency. Outsourcing revenues were 6.1 billion, up 19% in US dollars and 16% in local currency. Taking a closer look at our service dimensions, strategy and consulting, technology services, and operations all grew very strong double digits. Turning to our geographic markets, In North America, revenue growth was 22% in local currency, driven by double-digit growth in consumer goods, retail and travel services, software and platforms, and public service. In Europe, revenues grew 18% in local currency, led by double-digit growth in consumer goods, retail and travel services, industrial, and banking and capital markets. Looking closer at the countries, Europe was driven by double-digit growth in the UK, Germany, France, and Italy. In growth markets, we delivered 21% revenue growth in local currency, driven by double-digit growth in consumer goods, retail, and travel services, banking and capital markets, and high tech. From a country perspective, growth markets was led by double-digit growth in Japan, Australia, and Brazil. Moving down the income statements, Gross margin for the quarter was 33.3% compared with 31.8% for the same period last year. Sales and marketing expense for the quarter was 11.3% compared with 10.6% for the fourth quarter last year. General administrative expense was 7.4% compared to 6.8% for the same quarter last year. Operating income was $2 billion in the fourth quarter, reflecting a 14.6 operating margin of 30 basis points compared with Q4 last year. As a reminder, in Q4 last year, we recorded an investment gain that impacted our tax rate and increased EPS by 29 cents for the quarter. The following comparisons exclude this impact and reflect adjusted results. Our effective tax rate for the quarter was 25% compared with an adjusted effective tax rate of 28.4% for the fourth quarter last year. Diluted earnings per share were $2.20 compared with adjusted EPS of $1.70 in the fourth quarter last year. Day service outstanding were 38 days compared to 36 days last quarter. and 35 days in the fourth quarter of last year. Free cash flow for the quarter was $2.2 billion, resulting from cash generated by operating activities of $2.4 billion, net of property and equipment additions of $236 million. Our cash balance at August 31st was $8.2 billion, compared with $8.4 billion at August 31st last year. With regards to our ongoing objective to return cash to shareholders, In the fourth quarter, we repurchased or redeemed 3 million shares for $915 million at an average price of $305.61 per share. Also in August, we paid our fourth quarterly cash dividend of $0.88 per share for a total of $558 million. And our board of directors declared a quarterly cash dividend of $0.97 per share to be paid on November 15th a 10% increase over last year, and approved $3 billion of additional share repurchase authority. Now, I would like to take a moment to summarize our outstanding year. We are extremely pleased with the performance of our business in fiscal year 21, greatly exceeding all aspects of our original outlook that we provided last September. We delivered $59 billion in new bookings, a 20% increase in U.S. dollars over last year, which positions us well as we begin fiscal year 22. Revenues increased a record $6.2 billion, hitting the $50 billion mark, reflecting growth of 11% in local currency for the full year. This result, which is more than double the revenue growth we anticipated at the beginning of the year, showcases our agility and ability quickly scaled to deliver value and outcomes for our clients. Operating margin of 15.1% reflected a 40 basis point expansion over fiscal year 20, above the top end of our original guided range, even after making continued significant investments in our business and our people. Adjusted earnings per share were $8.80, reflecting 18 percent growth over adjusted FY20 EPS, and was well above our revenue growth. As a reminder, we adjusted earnings in both years to exclude gains on an investment. Free cash flow of $8.4 billion was significantly above our original guided range, reflecting a free cash flow to net income ratio of 1.5, driven by strong profitability. And finally, we significantly exceeded our original guidance for capital allocation by returning 5.9 billion of cash to shareholders while investing roughly 4.2 billion across 46 acquisitions to acquire critical skills and capabilities in strategic high growth areas of the market. So again, FY21 was truly an outstanding year. Momentum continues into fiscal 22 And we are laser focused on capturing the market opportunities coupled with a disciplined execution that you and we expect of us. Now let me turn it back to Julie.
Julie Sweet
Chair and Chief Executive Officer
Thanks, Casey. Turning to the demand environment, compressed transformation underpinned by cloud and digital continues to drive strong double-digit growth across our business. including for applied intelligence, cloud, Industry X, intelligent operations, interactive, intelligent platform services, security, and transformational change management. Technology is the single biggest driver of change in companies today, and the depth, breadth, and scale of our technology capabilities across our services is unmatched. We see the demand environment shaping up for FY22 to be more of the same. While digital leaders seeking to widen their competitive advantage and companies seeking to leapfrog their cloud and digital transformation are driving momentum in our business, the vast majority of companies are early in their transformation. And whether digital leader, leapfrogger, laggard, or in between, all face multi-year journeys ahead of them. because the re-platforming in the cloud and use of new technologies across the enterprise is a once-in-a-digital-era profound transformation. Simultaneously, we have ongoing exponential technology change that is accelerating and will create new opportunities, disruptions, and change for our clients. In addition, growth in parts of our business are by their very nature continuously evolving. For example, Interactive, now a $12.5 billion business growing 15%, continues to set a new standard for customer experience, connection, sales, and marketing at the intersection of data, creativity, and technology, and is tied to the ever-changing needs and preferences of B2C and B2B customers. Similarly, security, now a $4.4 billion business growing 29%, is driven by needs related to an ever-expanding digital threat landscape and, with our managed services, is providing much-needed protection and talent to our clients. Our clients value the depth and breadth of our services for the entire enterprise, across strategy and consulting, interactive technology and operations, and industry and functional expertise across 13 industries, plus the ability to deliver tangible outcomes, as well as our strong track record of investing ahead of our clients to anticipate their needs and drive our next ways of growth, such as our early moves in digital, cloud, and security. There remain entire parts of the enterprise for which digitization and the move to the cloud has only just begun. In particular, both the things companies make and the way they make things are being dramatically changed by technology. And that is the focus of our Industry X business, which we believe is the next big digital frontier. In fact, a 2021 Gartner survey of board of directors indicates that 93% expect that the number one business priority that will see transformational improvement from digital technology is manufacturing, distribution, and supply chains. We have invested for nearly a decade in Industry X and are now at approximately $5 billion in revenue, growing 36%. We look forward to welcoming the 4,200 industry-leading engineers and consultants of Umlaut when the acquisition closes in October. Similarly, sustainability is a critical area for which technology is still evolving. We believe that every business must be a sustainable business, and yet companies are at very early stages of figuring out how to make this shift. Last year, building on years of investment and experience, we launched our sustainability services under our new chief responsibility officer and global sustainability services lead. We have continued to accelerate our focus in this expanding and changing market and are proud of the work we are doing with leading partners like MasterCard, as we enhance its ability to track and analyze the carbon emissions of their suppliers and help decarbonize the UK energy system with clients such as National Grid. We do see a shift in the nature of the demand for our managed services across IT, security, and operations, with these services emerging as one of our most strategic differentiators. As companies simultaneously seek greater resilience, face a war for talent, the need to rapidly digitize and cost pressures, strategic managed services are increasingly a C-suite priority, with Accenture as a trusted partner of choice and increasingly integrated as a part of their talent strategy. Table stakes for managed services are efficiency, resiliency, and reliability. We further differentiate in our managed services because they are uniquely informed by our strong strategy and consulting capabilities, and deep industry and functional expertise. And they benefit from our strong level of investment for digital platforms like Synapse and MyWizard, and the seamless integration with our ecosystem partners, as well as due to the incredible pool of talented people our clients can access quickly when partnering with us. For example, we are partnering with Olympus, a leading manufacturer of optical and digital precision technology, to help them drive their transformation to become a global medical technology company. As part of this partnership, we have acquired their Japanese IT subsidiary company, which we will transform to deliver significant IT cost savings to Olympus, as well as upskill their people, combining their knowledge with our talent and technology to lead Olympus' digital transformation. Now let me bring to life some more of the demand we are seeing. All of these examples bring together the diverse capabilities across Accenture to create tangible value. We are a leader in cloud because we're able to serve our clients across the cloud continuum and create business value. We are partnering with Kubota, a Japanese multinational company, providing solutions leveraging a diverse range of products, technologies, and services in the fields of food, water, and the environment. to accelerate Kubota's digital transformation by creating solutions that will enhance the productivity and safety of food, promote circularity of water resources and waste, and improve urban and living environments. We will help create innovative sustainability solutions and a platform applying leading-edge digital technologies, including AI and IoT. Diverse data held across the group will be centralized for easy maintenance and use. We're also modernizing, replacing, or migrating legacy applications to the cloud and strengthening their global computer security incident response team. We are partnering with Jabil, a US-based global manufacturing services company, to further enhance their IT infrastructure capabilities through providing infrastructure-managed services for digital workplace, network, cloud, and data center support. We're helping Fenya, a Finnish insurer offering casualty, motor, and health and accident services to implement a cloud-based policy administration system to improve customer service using data and automation to make sales, claims, payments, and policy management processes more user-friendly. This will allow the company to quickly respond to changing market and customer demands and meet its goal of providing the best customer experience in the industry. compressed transformation is occurring across industries. We're partnering with Unilever, one of the world's largest consumer goods companies, in their digital transformation. Together, we are setting a new industry standard by reinventing technology delivery with cutting-edge automation, delivering cloud migration at scale, the largest ERP migration to the cloud in the industry, and shifting to technology solutions that support their growth strategies. with McCormick, a global leader in flavor in the food industry, where we are partnering on a strategic transformation program encompassing finance, supply chain, logistics, and plant maintenance. The new cloud-based platform and innovative data-driven approach will help standardize processes, increase efficiencies, and support their goal of doubling in size quickly. We're helping a European financial institution build the bank of the future and helping them become a next-level innovator. one that is leveraging technology and sustainability to transform multiple parts of their business, drive hyper-personalized customer experience, and create new lines of business like wealth management and insurance, which is expected to triple digital sales by 2023 and improve their already stellar cost-to-income ratio. At the same time, we're helping them deliver on their ESG initiatives, including inclusive financing, green software, and carbon data-free data centers. At Accenture, we're enabling new experience in growth and cost transformation across the enterprise and across industries. And a key enabler to these innovative, scaled services is the power of our operations capabilities. We are helping OpenFiber, an Italian telecommunications company, design and orchestrate construction of an ultra-broadband network, which will deliver fiber to 20 million households across Italy. Digitization and automation will help the construction site to proceed faster and more efficiently. With Interactive, we're helping MediaMarkt's Saturn retail group, Europe's leading consumer electronics retailer, transform their digital content capabilities with a state-of-the-art marketing operation. Automation and data insights enabled by Synapse will help deliver more engaging and personalized content while driving millions in savings. Our industry expertise continues to be a core competitive advantage, allowing us to bring deep industry and cross-industry knowledge enterprise-wide for our clients. I want to recognize, in particular, our software and platform industry, which is approximately $4 billion in revenue. In Q4, this group celebrated 20 consecutive quarters of double-digit growth, serving as a leading partner to our clients in this hyper-growth industry. KC, back to you.
Casey McClure
Chief Financial Officer
Thanks, Jolie. Now let me turn to our business outlook. For the first quarter of fiscal 22, we expect revenues to be in the range of $13.9 to $14.35 billion. This assumes the impact of FX will be about positive 0.5% compared to the first quarter of fiscal 21 and reflects an estimated 18% to 22% growth of local currencies. For the full fiscal year 22, Based upon how the rates have been trending over the last few weeks, we currently assume the impact of FX on our results in U.S. dollars will be approximately negative 0.5% compared to fiscal 21. For the full fiscal 22, we expect our revenue to be in the range of 12% to 15% growth in local currency over fiscal 21, which includes an inorganic contribution of about 5% as we continue to expect to invest about $4 billion in acquisitions. For operating margin, we expect fiscal year 22 to be 15.2% to 15.4%, a 10 to 30 basis point expansion over fiscal 21 results. We expect our annual effective tax rate to be in the range of 23% to 25%. This compares to an adjusted effective tax rate of 23.1% in fiscal 21. For earnings per share, we expect full-year diluted EPS for fiscal 22 to be in the range of $9.90 to $10.18, or 13% to 16% growth over adjusted fiscal 21 results. For the full fiscal 22, we expect operating cash flow to be in the range of $8.2 to $8.7 billion, property and equipment additions to be approximately $700 million, and free cash flow to be in the range of $7.5 to $8 billion. Our free cash flow guidance reflects a very strong free cash flow to net income ratio of 1.1 to 1.2. Finally, we expect to return at least $6.3 billion through dividends and shared purchases as we remain committed to returning a substantial portion of cash to our shareholders. With that, let's open it up so that we can take your questions.
Angie Park
Managing Director and Head of Investor Relations
Angie? Thanks, Casey. I would ask that you each keep to one question and a follow-up to allow as many participants as possible to ask a question. Operator, would you please provide instructions for those on the call?
Operator
Conference Call Operator
Of course. And once again, if you wish to ask a question, please press 1 then 0 on your telephone keypad. You may withdraw your question at any time by repeating the 1 then 0 command. And today, let's see, our first question comes from the line of Keith Bachman of Bank of Montreal. Please go ahead.
Keith Bachman
Bank of Montreal
Hi. Many thanks for letting me the opportunity to ask a question. I had two if I could. Outstanding set of results and guidance, first of all. I wanted to ask about the cash flow, if I could, guidance. And even at the high end of the range, the cash flow margin would be a pretty significant step down from fiscal 20 into fiscal 21. So I just wondered, is there any puts and takes within the cash flow guidance that we should be aware of as we're doing our model? Thank you. And I have a quick follow-up to that.
Casey McClure
Chief Financial Officer
Sure. Great. Thanks. Nice to hear from you, Keith. Yeah, so our free cash flow is $7.5 to $8 billion. It reflects very strong free cash flow to net income ratio of 1.1 to 1.2. And so we're really pleased with that. And it does have slightly higher CapEx expense of $700 million. So that's one slight difference from over 21%. We did have exceptionally strong free cash flow in fiscal year 21 at 1.5 free cash flow net income ratio. And that is just exceptional performance. It's not unusual for us to have free cash flow guidance at the beginning of the year. That is a decrease over what we've done in the previous years. And then lastly, we do allow for a slight uptick in DSO. in our guidance for next year, which would still be, you know, very industry-leading DSO performance.
Keith Bachman
Bank of Montreal
Okay, excellent, excellent. And then, Julie, maybe just for you, I think you mentioned this year you did 46 M&A deals, and you mentioned in the guidance comments that there's quite a bit of M&A, I think $4 billion in M&A contemplated for this coming fiscal year. How do you think about the integration risk? Accenture has... I would argue, a very special culture, and you're bringing in a lot of new people over the course of the last 12 months and the forward next 12 months. How do you think about the risk of a simulation of these deals, and how do you manage this process? You have a very good track record over the last 10 years, but there is a lot of M&A on the table that you're bringing in the company. I'm just wondering if you could speak to how you think about the risk associated with that to make sure the business keeps moving forward.
Julie Sweet
Chair and Chief Executive Officer
Sure. So great question, and thanks, Keith. So first of all, as you indicated, we've got a really strong track record, and so this step up in acquisitions comes based on years of experience, including and fine-tuning integration. So that's number one. Secondly, our acquisitions happen globally, and as I've talked about this year, they're pretty evenly balanced. And why is that important? When we switched to our model earlier this year of a geographic-focused model from a P&L perspective, one of the reasons is to allow us as well to be super close to our people. And most of these acquisitions are not global, right? Some are, like at Umlaut, but like, for example, Project Nevada in the federal business, you know, very local. And the vast majority... are in one or two markets. And so the integration, it's not like you have this enormous company that's trying to integrate lots of people all over the globe at the same time. We have senior leaders accountable for the acquisitions. And so we really get the right balance, and we have our own. And so, for example, when we look at this, we look at market by market, how many acquisitions are we doing in this market? So how does that enable us to make sure that we can spend the time? So this is a finely tuned approach for integration. And of course, we bring on people in acquisition or not all the time. And so focus on culture is just part of who we are.
Keith Bachman
Bank of Montreal
Okay, excellent. Thank you, Julie.
Operator
Conference Call Operator
And our next question comes from the line of Lisa Ellis with Moffitt Nathanson. Please go ahead.
Lisa Ellis
Moffitt Nathanson
Hi, good morning. Thanks for taking my question. I was thinking about the $50 billion revenue milestone, which is pretty amazing. Julie, as you're mapping out the path to $60 billion over the next few years, can you talk about where you see the major sources of incremental revenue looking out from here forward? Thank you. Great.
Julie Sweet
Chair and Chief Executive Officer
Well, thanks, Lisa. Nice to talk to you. First of all, and I talked a little bit about this in the script, we are still very early in the transformation of companies in building just their digital core. So, for example, if you look at something like SAP, you know, their stats, as they point out, you sort of have less than 20% of companies who've actually both bought and begun implementing S4 HANA. And we see the move to the cloud. You've got sort of maybe today roughly 25% to 30% of workloads. So there's a lot of work, which is a multi-year journey, in actually building the digital core and then at the same time transforming the ways they work. So we've got multi-year ahead. And even when you look at who's doing compressed transformations, You have this core of leaders and leapfroggers, but the vast majority of companies are not yet engaged in compressed transformation. So just from a multi-year outlook on the fundamentals of replatforming and moving to true digital-enabled enterprises, still in early stages. Then you add on top of that, there are whole parts of the enterprises where even the technologies are really new. And so Industry X is a great example of that. We see that as the next digital frontier. And we're still very, very early. And so that will be kind of its own wave as we look forward. And then areas like sustainability. Again, technology is early. Every industry has to find its way on sustainability. And so as we, you know, think about our own growth strategy, it starts with what our clients need. So we continue to diversify the parts of the enterprise that we're serving, and that enables – that's what our clients need, and that enables next waves of growth for us. And we continue to innovate and anticipate, like in sustainability, what our clients need. And so when you kind of take this, you see both from serving the enterprise, the maturity – of that and then you add on top of that that there are areas that are evergreen like interactive it's all about client it's a growth agenda it's always going to change manufacturing will be the same security grows as the digital landscape grows so hopefully it gives you a flavor of how we're thinking about both our next waves of growth and just the resiliency of the diversity of what we do yep terrific um
Lisa Ellis
Moffitt Nathanson
My follow-up was actually on managed services, which you called out in the prepared remarks. I'm not really used to thinking about Accenture doing managed services. Can you just elaborate a bit on that? Is this primarily actually infrastructure-related managed services or apps or just maybe a little bit more detail on what exactly you're doing and Accenture's differentiation there? Thanks.
Julie Sweet
Chair and Chief Executive Officer
So just think of we have consulting and outsourcing, right? So managed services is just another term for outsourcing services. And so if you think about our operations business, which is now about $8 billion, right, so all the managed services we provide are everything from finance and accounting to industry-specific, like we called out in the script, the stuff we're doing in telecom. We're doing things in insurance and both health and P&C. So we've got industry-specific. We have marketing services. So there's that. Then, of course, there's our powerful, IT services, we've been doing outsourcing for years, right? Term application outsourcing is an industry term. And then we have our managed services and security. We bought Symantec last year. And so this is a core part when you think about our revenue, you know, between consulting and outsourcing. And the point that's happening now is that we've always done this, but What we're seeing is, you know, I just had a call with a CEO the other day who's like, he started a call with like, Julie, I'm really having a hard time hiring people in digital, right? And how are you seeing companies, you know, help? And we talked about how by strategically outsourcing like in security, in marketing, you can access the digital talent and it becomes part of their own talent strategy to address the war for talent while at the same time digitizing faster and I have another client who said, look, you had 50 things that my IT department was about to build in order for us to automate and transform, and I get it through your Synapse platform. The same is true on the IT and infrastructure side. And, of course, infrastructure managed services in the cloud, growing area as well from the move to the cloud. So I think the shift we were calling out, Lisa, though, is just how strategic this is at a time of compressed transformation, because it's meeting the needs of the war on talent and the need to digitize and the need to move fast at the same time.
Lisa Ellis
Moffitt Nathanson
Great. Thank you. Thanks a lot, and congrats.
Julie Sweet
Chair and Chief Executive Officer
Thanks.
Operator
Conference Call Operator
And our next question comes from the line of Brian Bergen with Cowan. Please go ahead.
Brian Bergen
Cowan
Hi, good morning. Thank you. First, I have a question on bookings. Can you talk about the dynamic in 4Q? It looks like outsourcing did tick down for the first time in a while, year over year. So just anything to call up there. And then just generally, how do you see the pipeline developing as you think about fiscal 22 bookings levels?
Casey McClure
Chief Financial Officer
Yeah, thanks, Brian. So, you know, there's nothing really to point out in terms of Q4 bookings with outsourcing. They can just be a little bit lumpy. But it was very strong performance. But let me just maybe talk a little bit about overall bookings as we head into 22. You know, we do feel really good about the momentum in our business. And as Julie went through, we had, you know, 72 clients with bookings over 100 million this year. And you can see that then helping us as we head into FY22, Brian, with the 18 to 22% that we have in Q1. And you also see that in our 12 to 15% revenue range that we have for fiscal 22. I think it's important to also note that it does include about 5% in organic contribution, but at the top end of our revenue range, again, driven by bookings, it's going to represent about 10% organic growth at the upper end. And while we do benefit from an easier compare in the first half, It does continue to imply strong organic growth in the second half. And if you look at why is that, when you peel back bookings, again, please with the $15 billion that we had in Q4, strong book to build 1.1. It is $60 billion for the whole year with double-digit growth in consulting. And I think it's important to also note in consulting bookings, we had $8 billion for the last three quarters, which is terrific. And outsourcing, which for the entire year had a very strong book to build, 1.2, in all three markets and services. And when you peel it back, there's really three things. Again, just peeling back bookings for you. There's three things that I would also note. One is that, yes, we did have a lot of larger bookings that help us position us well for the future throughout FY22. But we had a nice mix all the way through to the smaller deals, which benefit near-term revenues. The second thing is that the bookings were very broad-based across all of our services, and that includes strategy and consulting, which is really good as well. And lastly, you know, they're aligned, as Julie's talked quite a bit, about our strategic priorities, cloud, industry X, and security, for example.
Brian Bergen
Cowan
Okay. Thank you. A follow-up here, then, on attrition. Can you just give us a sense of what you're anticipating for attrition levels backward into 2022? And any added measures you're taking to try and drive that 19% down?
Casey McClure
Chief Financial Officer
Yeah, so let me just maybe talk a little bit about the numbers, and Julie can give some other color here. But our managed nutrition at 19% prime was really, the fourth quarter, was in the zone that we expected. And it's 14% for the year. And we've been at 19% before. It's obviously a very hot market right now. But when you peel it back, it continues to be more in the lower part of the pyramid. And it's largely concentrated in India where we really don't have any issues in hiring.
Julie Sweet
Chair and Chief Executive Officer
Yeah, and I think that's important because you look at a headline number and then you have to really kind of understand, you know, where is the attrition. And, you know, at the same time, as you might imagine, we're always very focused on making sure that we're attractive. So we're very pleased that our executive retention team is going very well. I think we are, you know, we very much focus on our employee value proposition. And when you think about the actions we've taken, like a record number of 120,000 promotions, the training that we're providing people that's really valued. And then, you know, frankly, things like the way that we have approached vaccines, right? So we've now vaccinated 85,000 of our people and their families directly in addition to what we're supporting our you know, through like in the U S through our, our carriers. And, and, you know, as I talked a little bit about in the script, what we find is people really care about the fact that they are working for a company that focuses on financials and all of the other, what we call 360 degree value. So, you know, what we're doing in sustainability, being a leader that we're going to be carbon neutral by 2025 really matters. And so we, we continue to look at how can we help our people be met better off, succeed personally and professionally, and be proud of a company that not only creates value but leads with value.
Brian Bergen
Cowan
Okay, thank you.
Operator
Conference Call Operator
And our next question comes from the line of James Fawcett with Morgan Stanley. Please go ahead.
James Fawcett
Morgan Stanley
Thank you very much. Wanted to ask a couple of quick questions that are follow-up on the hiring. Your pace of hiring and net has been quite stunning, at least over the last couple of quarters. Can you talk about a little more detail in terms of how you're finding the hiring environment, particularly for newer skill sets? And I guess, do you think you need to kind of sustain the recent pace of hiring going forward? And You know, I guess my second question, I'll just throw it in at the same time, is back to V&A. You talked about kind of the inorganic contribution and integration, but is this kind of the recent pace that we've seen? Is this also something that you expect to need to sustain and want to sustain on a go-forward basis, whether in terms of number of deals or amount that you're spending, et cetera? Thanks a lot.
Casey McClure
Chief Financial Officer
Okay. Thanks. I will cover the headcount. So I would just first start with, in this market, with a war for talent, we're very pleased with the 56,000 net additional people that we hired in Q4. As we see strong momentum really continuing in FY22, and you see that again in our growth rates for the first quarter, we're off to a strong start at 18% to 22% in Q1, and the full year at the top end at 15%. And we were able to accelerate some of our hiring. And we plan to continue to do so in quarter one in order to have the talented people that we need to match demand in the market. And so that's to your first question on hiring. To your second question on V&A, you know, while I won't guide longer term into the amount of spend that we're going to do past 22 in V&A, you know, it remains an important part of our strategy you know, on a go-forward basis.
Julie Sweet
Chair and Chief Executive Officer
Yeah, and I just, I think it's just to remember, you know, taking a step back on two things. One is on the people side, we made a deliberate decision to accelerate hiring, you know, this quarter and next quarter, which given, as you said, the environment and our ability to attract people, we think makes sense so that we're not, you know, we're not worried about being constrained by with respect to people, and we're able to do that. And I think that's a huge differentiator for us. And secondly, we made a decision last year and we've made a decision this year in V&A to really invest and take advantage of our ability to invest to serve our clients. And when I go to clients, one of the things that we talk about and clients really value is that when they're partnering with us, they're partnering not just for the capabilities we have today, but because we have a track record of investing year in and year out and creating, you know, and anticipating their needs. And we point to, you know, the kinds of acquisitions like an UMA, like a Nevada, like Infinity Works and cloud, and that we're doing it in markets all around the world to benefit them. And so we believe this is really setting us up last year and this year to right, for those next waves of growth. And it's truly differentiating in the eyes of our clients.
Operator
Conference Call Operator
And our next question calls from the line of Ashwin Srivayakar from Citi. Please go ahead.
Ashwin Srivayakar
Citi
Thank you. Hi, Julie. Hi, Casey, Angie. Congratulations on the results and outlook. First question is, you know, it seems clear we're in a very exciting time here for IT services. I've had this view for some time now that the acceleration of demand that you're seeing is sustainable for several years. And I don't mean to imply that getting revenue growth is easy, but if you have to worry less about revenue growth given the investments you've already made, there's Do you have the opportunity to change your financial model, accelerate it, get higher gross margins, better G&A leverage? Thoughts on moving to a more nonlinear model with solutions may be especially important given that you're at 620,000 people.
Casey McClure
Chief Financial Officer
Yeah, I'll start with that. I think, you know, Ashwin, you know, our financial model, you know, really remains the same in terms of the three key imperatives that you hear us go through. each year, which is grow faster than the market takes share, modest margin expansion while investing, you know, at scale in our business and our people. So in that last part, maybe I'll just talk about out margins. So we, you know, are very proud of the 10 to 30 that we have this year. You know, that does imply, obviously, that we will continue to get efficiencies in how we run our business, both in terms of how we deliver to our clients, as well as within the SG&A and how we run our own organization. Okay.
Julie Sweet
Chair and Chief Executive Officer
Yeah, maybe just add a couple of points. I'm glad you acknowledged that revenue growth is not easy, so thank you for that. But just taking a step back just to make sure, because I think over the last decade you've seen a real shift in the professional services industry. The nature of the exponential technology change and the need to help clients move faster and and do so more efficiently has meant that you need to be able to invest significantly. So as we think about, you know, moving forward, like the investments we've done to build, you know, synopsis, like to, and continue to evolve it, to build industry solutions, as you mentioned, require us to continuously innovate, invest. You know, you saw that in our, you know, And so what I would say is it's not that you sort of say here's the revenue and then can you just fundamentally shift because there is significant cost. You know, having all aspects of our business grow like this is not simply because there's demand. It's the solutions we're bringing them. And, you know, as I've talked about in Prior Earning Cloud, it isn't linear today even because we've automated so much of what we do when you look at something like our operations business, you look at, you know, my wizard and we continue to do so. And that's really part of the business now. And so I think it's important to kind of understand what's helping drive the demand for our services are, you know, the way we're gaining market share. is not simply because there's a lot of demand in the market, but the solutions we're bringing. And this is our big differentiator because we can go all the way from strategy to operations, right? All of the examples we're giving involve multiple aspects of our services, and you can't just build that overnight either, right? So, you know, the fact that we're becoming integrated in talent strategy and our outsourcing and our, you know, what we also call managed services is about being trusted and the fact that we could delivered during the pandemic and be a trusted partner puts us in a very different place than others who might be trying to build these capabilities.
Ashwin Srivayakar
Citi
Got it. Got it. Thank you for that. And then the other question is, you know, over the last 18 months, your revenue growth has absorbed the negative impact of less T&E. Is that coming back? Do you have updated thoughts on back to office? And, you know, what's the assumption for that in your in your outlook?
Julie Sweet
Chair and Chief Executive Officer
So I'll let Casey answer specifically, but I will say that, um, uh, if any of us can actually predict, you know, how we're going to go to the office, like I'd like to meet that person. Uh, let's just say it's been a humbling experience, right? Uh, how many times have we all gotten ready to go back? And I don't know about you, but like, like five different things that we're going to be in person in the next two months have just come back to zoom. So, um, or teams. So it's been an interesting time, the new normal. But Casey, why don't you take us through just the assumptions we're using?
Casey McClure
Chief Financial Officer
Yeah. So Ashwin, I'll first start with revenue. Our revenue guidance, the 12 to 15, it does not include any specific uptake from reimbursable travel. And if that assumption changes, we'll reflect that in our updating guidance. And as Julie said, just in terms of You know, increases to travel assumed in our overall P&L for 22, it is difficult to predict, but we do have an increase built into, particularly in the back half of the year, for some travel costs.
Brian Bergen
Cowan
Got it. Thank you for that.
Operator
Conference Call Operator
And our next question comes from the line of Jason Kupferberg with Bank of America. Please go ahead.
Jason Kupferberg
Bank of America
Thanks, guys. Good morning. I wanted to start just with a visibility question. The reason I ask is obviously your constant currency revenue growth here in Q4 was quite robust. So it wasn't really above the top end of your guidance, whereas in recent quarters you had been handily exceeding the top end of your expectations. So I'm just wondering, is this simply because your visibility has improved, so you've gotten more comfortable, you don't necessarily need to put extra cushion into the guidance, or did some bookings not ramp as fast as expected in the quarter? And then just the related question for fiscal 22, as you set the initial outlook for this year, any change in approach versus this time last year? Again, perhaps because your visibility has improved. Thanks.
Casey McClure
Chief Financial Officer
Yeah, I will answer both questions, you know, in really the same way, which is, you know, for the fourth quarter, we were slightly above our FX adjusted guided range, but We always try to aim to be in the top part of our guided range. And really, it's just this year, it's been a story of an unprecedented ramp. So we're really pleased that we were able to kind of nail down where we thought we would end out the quarter. And I'd say the same thing really for 422. It's not any change in visibility. It's not any change in the way we're doing things. We always call it as we see it. These are our best estimates. And with the 12 to 15, you know, all parts, all points are in possibility. That's why they're in the range. But we continue like we always do to aim for the top quadrant and top part of our range. No change.
Jason Kupferberg
Bank of America
Okay. Okay. Good to know. And just to follow up, what are your expectations for book to bill in consulting and overall for the first quarter and for the full fiscal year, and then just what you're thinking about for consulting versus outsourcing revenue growth this year. Thanks, guys. Congrats.
Casey McClure
Chief Financial Officer
Yeah, thank you. Yeah, so we feel good about our pipeline, you know, as we head into the fiscal year. I would say I will just comment on, you know, Q1 bookings. We do feel really good. about where we are. You know, historically, we do see some seasonality in Q1, and larger deals can make things lumpy, but we feel really good about our positioning for the first quarter. And in terms of revenue growth, I'll just say that for quarter one, we see consulting continuing in strong double digits and outsourcing in the double digits range.
Jason Kupferberg
Bank of America
Great.
Casey McClure
Chief Financial Officer
Operator, we have time. Yeah, and for the full year, I mean, consulting should continue to be strong double digits, and You know, outsourcing, depending on where we land in the range, will be high single to low double digits.
Jason Kupferberg
Bank of America
Thank you.
Angie Park
Managing Director and Head of Investor Relations
Great. Thanks. Operator, we have time for one more question, and then Julie will wrap up the call.
Operator
Conference Call Operator
Of course. And that last question comes from the line of Tin Jin Huang with J.P. Morgan. Please go ahead.
Tin Jin Huang
J.P. Morgan
Thank you so much. You know, really impressive growth at scale here. I wanted to ask on Industry X, it was $5 billion in revenues, up 36% I wrote down. So, I think Julie said it's the next frontier here. Does this have potential to be as big as cloud? I'm just trying to think about the sizing of industry X, recognizing it's early, but also its importance.
Julie Sweet
Chair and Chief Executive Officer
Yeah. I mean, I think we're not really sizing that today. I mean, when you think about cloud, cloud is the entire enterprise. So it's sort of hard to sort of do that. What we'd say is this will be, I mean, we're already at 5 billion and we consider it the next digital frontier and it's super early, right? Some technologies have just, you know, really been coming online in the last year or two that are cloud-based. And when you look at, like, what we're doing, for example, like Vivian Westwood, one of the largest independent global, you know, fashion companies, we're doing a new PLM solution for them. We're doing so for Alstom, a global leader in transportation. We're doing the same, you know, in a power company. So they can be The range of what we're doing is both broad-based in terms of industry, and so we do think of this as really a big growth driver for the future, but not sizing it today.
Tin Jin Huang
J.P. Morgan
Okay. No worries. Just thought it was interesting because the scope of it can be quite large. Just my quick follow-up. I know you fielded a lot of questions on acquisitions already. Digital assets are being quite – Valued pretty highly here across the board. It looks like you're still implying a reasonable revenue multiple with your inorganic contribution. Have you seen any changes on the valuation side? I know you're still a destination for many companies, but just curious if valuations have changed in any way in your thinking.
Julie Sweet
Chair and Chief Executive Officer
Casey, do you want to answer that?
Casey McClure
Chief Financial Officer
Yeah, I mean, I say, Tingen, you know, clearly, you know, valuations, you know, we participate in the overall market. You've seen what valuations have done in the overall market. But I would just say that, you know, we have pretty high hurdle rates in terms of what we expect from our business cases. And we track that very closely, as you would expect of us. And we're very pleased with our ongoing performance of our portfolio against the hurdle rates that we put forth in those business cases.
Tin Jin Huang
J.P. Morgan
Yeah. No, it's impressive. Thank you both.
Julie Sweet
Chair and Chief Executive Officer
Great. Thank you. All right. Well, now it's time to wrap up. In closing, I want to thank all of our people and our managing directors for what you all do every day. Our people and actions and results in FY21 have really put us in a terrific position as we go into FY22 to create even more value ahead. And I know I and the entire leadership team are super excited and confident about what's to come. And I'll simply end by thanking all of our shareholders for your continued trust and support. Be well, everyone. Thanks.
Operator
Conference Call Operator
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