TCS, Infosys, other IT stocks in focus as Accenture reports 6% revenue growth in Q1, strong FY26 guidance

IT stocks such as Infosys, HCL Technologies, Tata Consultancy Services (TCS), will be in focus on Friday, December 19, after Accenture reported its first quarter results for fiscal 2026 on Thursday, posting a 6% rise in revenue in US dollar terms and issuing strong guidance for the full-year forward, which could impact services across the IT sector.

For the first quarter of FY26, Accenture reported revenue of $18.7 billion, up 6% in US dollars and 5% in local currency.

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The company also recorded new bookings of $20.9 billion, up 12% in US dollars and 10% in local currency. Within this, Advanced AI Booking contributed $2.2 billion.

The company’s GAAP operating margin came in at 15.3%, a decline of 140 basis points compared to 16.7% margin in Q1 FY25. However, adjusted operating margin increased by 30 basis points to 17.0%.

GAAP diluted earnings per share (EPS) was $3.54, down slightly from the $3.59 reported in the same quarter last year. On an adjusted basis, EPS increased 10% to $3.94.

Free cash flow for the quarter was $1.5 billion. Accenture returned a total of $3.3 billion to shareholders, including $2.3 billion in share repurchases or redemptions of 9.5 million shares and a $1.0 billion dividend payment, a 10% year-over-year increase of $1.63 per share.

Accenture guidance for FY26

In its business outlook for fiscal 2026, the company maintained full-year revenue growth expectations of 2% to 5% in local currency. Excluding an estimated 1% impact from its US federal business, revenue growth in local currency is estimated to be between 3% and 6%.

Accenture now expects its GAAP operating margin to be between 15.2% and 15.4%, an expansion of 50 to 70 basis points. Adjusted operating margin is expected to be between 15.7% and 15.9%, representing an increase of 10 to 30 basis points.

The company also revised its full-year GAAP diluted EPS guidance to a range of $13.12 to $13.50, representing an increase of 8% to 11%. Adjusted EPS is expected to be between $13.52 and $13.90, representing an increase of 5% to 8%.

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