Accenture PLC

Good day and welcome to Accenture's fourth quarter for fiscal year 2025 earnings call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad, and to withdraw your question, please press star then two. Please note, today's event is being recorded. I'D NOW LIKE TO TURN THE CONFERENCE OVER TO ALEXIA QUADRONI, EXECUTIVE DIRECTOR, HEAD OF INVESTOR RELATIONS. PLEASE GO AHEAD.

THANK YOU, OPERATOR, AND THANKS EVERYONE FOR JOINING US TODAY ON OUR FOURTH QUARTER AND FULL YEAR FISCAL 2025 EARNINGS ANNOUNCEMENT. AS THE OPERATOR JUST MENTIONED, I'M ALEXIA QUADRONI, EXECUTIVE DIRECTOR AND HEAD OF INVESTOR RELATIONS. ON TODAY'S CALL, YOU WILL HEAR FROM JULIE SWEET, OUR CHAIR AND CHIEF EXECUTIVE OFFICER, AND ANGIE PARK, OUR CHIEF FINANCIAL OFFICER. We hope you've had an opportunity to review the news release we issued a short time ago, and we also have an earnings presentation, which will be made available on our website after the call. Let me quickly outline the agenda for today's call. Julie will begin with an overview of our results. Angie will take you through the financial details, including the income statement and balance sheet, along with some key operational metrics for the fourth quarter fiscal year. Julie will then provide a brief update on the market positioning before Angie provides our business outlook for the first quarter and full year fiscal 2026. 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 risk 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 provided useful information for investors. We include reconciliations from non-GAAP financial measures where appropriate to GAAP in our news release or in the investor relations section on 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.

Thank you, Alexia, and to everyone joining this morning. And thank you to our more than 779,000 re-inventors around the world for your extraordinary work and commitment to our clients. In fiscal year 2025, we delivered a strong year financially. We significantly elevated our competitive positioning, and we took our next big steps to position us for growth in the age of AI. We grew 7% last year, which was adding $5 billion in revenue. with over $80 billion in bookings. And we did so against a macroeconomic backdrop that did not improve over FY24. And of that 7% growth, the majority was organic, and the growth was broad-based across markets, industries, and types of work. We also delivered strong earnings per share growth and generated strong free cash flow, both above our guidance on an adjusted basis, and we returned a significant amount of cash to shareholders an increase of 7% over FY24. And we took share at more than 5X our investable basket. How did we do it? We built on the rapid shift in our business we made by the end of FY24 to address the challenging market conditions. We then took action to fully capitalize on the competitive advantages we have built over a long period of time to deliver these results. These advantages include our ecosystem partnerships, our breadth of capabilities, our deep and trusted client relationships, our track record of investing in new skills and rotating our business with successive technology revolutions, and, of course, our ability to invest. Our strategy for more than a decade has been to be the number one partner for the tech ecosystem, and it's serving us well. Technology is front and center for every client, and in FY25, we continue to be the number one partner for all of our top 10 ecosystem partners by revenue. 60% of our revenue is from work that we do with these partners, which grew 9%, outpacing our overall revenue growth in FY25. These partners are the world's largest technology tech companies by revenue, and they're seeking deeper and deeper partnerships with us as they look for help to turn their technology into business outcomes and scale the adoption of AI. We continue to be the reinvention partner of choice for our clients. Our deep and long-standing relationships mean we know our clients and their industries inside out. Our global footprint and breadth of capabilities means we can serve more of our clients' needs for large-scale transformations than any other player in the industry. We added 37 clients with quarterly bookings greater than $100 million in Q4 alone, bringing us to a record of 129 such bookings for the year, and we finished the year with 305 Diamond clients, our largest relationships. Our early and decisive decision in FY23 to invest significantly to become the leader in Gen AI with a $3 billion multi-year investment is clearly paying off as we capture this new area of spend for our clients. In FY25, we tripled our revenue over FY24 from Gen AI and increasingly agentic AI to $2.7 billion. And we nearly doubled our Gen AI bookings to $5.9 billion. And as a reminder, these numbers only reflect revenue and bookings specifically related to advanced AI. which is gen AI, agentic AI, and physical AI, and do not include data, classical AI, or AI used in delivery of our services. We're now going to use the term advanced AI as it encompasses the latest developments that are starting to gain traction. In addition to all we're doing around advanced AI, for over a decade, we have made disciplined inorganic investments to expand our market and fuel organic growth. For example, our capital projects business, which was initially built through several acquisitions around the world, is now a $1.2 billion business for us. And in FY25, it grew 49% year on year, largely organically. While delivering these results, we also took the next big steps in our reinvention for the age of AI. We are reinventing what we sell, how we deliver, how we partner, and how we operate Accenture. In short, on the ground, advanced AI is becoming a part of everything we do. Let's review our reinvention to date. By definition, every new wave of technology has a time where you have to train and retool. Accenture's core competency is to do that at scale. Our clients cannot possibly build all of the expertise they need on their own. They need us to go first. fast. In FY23 we had 40,000 AI and data professionals with roughly 30 people working on a handful of Gen AI projects with negligible revenue. Today we have 77,000 AI and data professionals. We've worked on more than 6,000 advanced AI projects just this year and we delivered meaningful revenue in FY25. We're also in the process of equipping all of our re-inventors with the latest AI skills. Over 550,000 of our re-inventors are already trained in the fundamentals of GenAI. We've already significantly embedded advanced AI into key platforms like GenWizard so that we are now delivering differently for our clients. And we've reinvented our corporate functions to create additional investment capacity among other benefits, and we'll now increasingly use advanced AI in the next chapter. In FY25, we focused our new actions on the ecosystem, our talent strategy, and our growth model. We expanded our partnerships beyond the top 10 in AI and data and created new ones with companies that are becoming critical to many of our clients who also want to work with us to help them scale their relationships. And our revenue is growing in double digits with many of these partners. In FY26, we expect to increase our headcount overall across our three markets, including in the US and Europe, reflecting the demand we see in our business. In addition to continuing to hire world-class talent, in FY25, we developed and are implementing a refreshed, robust, three-pronged talent strategy to rotate our workforce. We are investing in upskilling our re-inventors, which is our primary strategy. We are exiting on a compressed timeline. People work re-skilling based on our experience is not a viable path for the skills we need. And we're continuously identifying areas of how we operate Accenture to drive more efficiencies, including through AI in order to create more investment capacity. Finally, our growth model. On September 1st, we launched reinvention services, which brings all of Accenture's capabilities into a single unit. Nearly 80% of our large deals are multi-service. The model, as we fully roll it out, will make it faster and simpler to sell and deliver everything Accenture offers and to rotate our offerings to embed more AI and data and equip our people. In summary, I am pleased with our strong results in FY25 and our positioning for FY26 and beyond. Over to you, Angie.