M+E Connections

Accenture again saw strong demand for digital, cloud and security-related services in its fourth quarter (ended Aug. 31), and those businesses – which the company refers to as “the New” for shorthand – accounted for more than 50% of its total revenue in the quarter.

The company “clearly strengthened our leadership position in the New” during the past fiscal year and, “once again, we gained substantial market share,” CEO and chairman Pierre Nanterme told analysts on an earnings call Sept. 28.

In reporting Accenture’s third-quarter results in June, Nanterme pointed out that the New represented about 50% of its total revenue for the first time. He also added then that, by 2020, the “vast majority” of its revenue will come from digital, cloud and security.

For Q4, digital, cloud and security-related services “continued to drive very strong double-digit growth” for Accenture, CFO David Rowland said on the call Sept. 28.

Accenture closed 10 transactions in the quarter, boosting its total number of transactions for the year to 37, Rowland told analysts, adding the company invested a record $1.7 billion that provided it with “scale and capabilities in key growth areas and further strengthened our leadership position in the New.”

In early September, Accenture said it bought MATTER, a San Francisco-based design and innovation firm. The acquisition added a new, physical product design element to Accenture Interactive’s design and innovation unit, Fjord.

Accenture’s acquisitions also included Clearhead, an Austin, Texas-based digital optimization company that it said in July was designed to strengthen the personalization services of Accenture Interactive. As of July, Clearhead was the 14th acquisition Accenture Interactive had made since 2013.

In May, Accenture Interactive bought e-commerce solution provider Media Hive. Other acquisitions in Accenture’s past fiscal year included creative agencies The Monkeys/Maud (Australia) and Karmarama (U.K.), communications agency Kunstmaan (Belgium), and digital agency SinnerSchrader (Germany).

Total revenue grew 8% in Q4 from a year ago, to $9.1 billion. But profit fell to $983.2 million ($1.48 a share) from $1.1 billion ($1.68 a share).

Revenue in Accenture’s Communications, Media & Technology division grew 7% to $1.8 billion, while Financial Services revenue increased 9% to $2 billion, Health & Public Service revenue grew 5% to $1.6 billion, products revenue increased 10% to $2.5 billion, and resources revenue increased 5% to $1.3 billion.

For the full year, revenue from digital, cloud and security-related services jumped about 30% to $18 billion, and represented about 50% of total revenue, Accenture said. Of those sales, digital accounted for $13.5 billion, while cloud followed at $6.5 billion and security with $1.2 billion, it said.

Accenture expects to report sales of $9.1 billion to $9.4 billion for its first quarter, and expects to report revenue of 5-8% for the current fiscal year, it said.