Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with our Consolidated Financial Statements and related Notes included elsewhere in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended August 31, 2024, and with the information under the headings “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” in our Annual Report on Form 10-K for the year ended August 31, 2024, as updated in this Quarterly Report on Form 10-Q.

We use the terms “Accenture,” “we,” “our” and “us” in this report to refer to Accenture plc and its subsidiaries. All references to years, unless otherwise noted, refer to our fiscal year, which ends on August 31. For example, a reference to “fiscal 2025” means the 12-month period that will end on August 31, 2025. All references to quarters, unless otherwise noted, refer to the quarters of our fiscal year.

We use the term “in local currency” so that certain financial results may be viewed without the impact of foreign currency exchange rate fluctuations, thereby facilitating period-to-period comparisons of business performance. Financial results “in local currency” are calculated by restating current period activity into U.S. dollars using the comparable prior year period’s foreign currency exchange rates. This approach is used for all results where the functional currency is not the U.S. dollar.

Disclosure Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”) relating to our operations, results of operations and other matters that are based on our current expectations, estimates, assumptions and projections. Words such as “may,” “will,” “should,” “likely,” “anticipates,” “aspires,” “expects,” “intends,” “plans,” “projects,” “believes,” “estimates,” “positioned,” “outlook,” “goal,” “target,” and similar expressions are used to identify these forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Forward-looking statements are based upon assumptions as to future events that may not prove to be accurate. Actual outcomes and results may differ materially from what is expressed or forecast in these forward-looking statements. Risks, uncertainties and other factors that might cause such differences, some of which could be material, include but are not limited to those identified below.

Business Risks

Our results of operations have been, and may in the future be, adversely affected by volatile, negative or uncertain economic and geopolitical conditions and the effects of these conditions on our clients’ businesses and levels of business activity.
Our business depends on generating and maintaining client demand for our services and solutions, including through the adaptation and expansion of our services and solutions in response to ongoing changes in technology and offerings, and a significant reduction in such demand or an inability to respond to the evolving technological environment could materially affect our results of operations.
Risks and uncertainties related to the development and use of AI could harm our business, damage our reputation or give rise to legal or regulatory action.
If we are unable to match people and their skills with client demand around the world and attract and retain professionals with strong leadership skills, our business, the utilization rate of our professionals and our results of operations may be materially adversely affected.
We face legal, reputational and financial risks from any failure to protect client and/or Accenture data from security incidents or cyberattacks.
The markets in which we operate are highly competitive, and we might not be able to compete effectively.
Our ability to attract and retain business and employees may depend on our reputation in the marketplace.
If we do not successfully manage and develop our relationships with key ecosystem partners or if we fail to anticipate and establish new alliances in new technologies, our results of operations could be adversely affected.


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Financial Risks

Our profitability could materially suffer due to pricing pressure, if we are unable to remain competitive, if our cost-management strategies are unsuccessful or if we experience delivery inefficiencies or fail to satisfy certain agreed-upon targets or specific service levels.
Changes in our level of taxes, as well as audits, investigations and tax proceedings, or changes in tax laws or in their interpretation or enforcement, could have a material adverse effect on our effective tax rate, results of operations, cash flows and financial condition.
Our results of operations could be materially adversely affected by fluctuations in foreign currency exchange rates.
Our debt obligations could adversely affect our business and financial condition.
Changes to accounting standards or in the estimates and assumptions we make in connection with the preparation of our consolidated financial statements could adversely affect our financial results.

Operational Risks

As a result of our geographically diverse operations and our strategy to continue to grow in our key markets around the world, we are more susceptible to certain risks.
If we are unable to manage the organizational challenges associated with our size, we might be unable to achieve our business objectives.
We might not be successful at acquiring, investing in or integrating businesses, entering into joint ventures or divesting businesses.

Legal and Regulatory Risks

Our business could be materially adversely affected if we incur legal liability.
Our work with government clients exposes us to additional risks inherent in the government contracting environment.
Our global operations expose us to numerous and sometimes conflicting legal and regulatory requirements, and violation of these regulations could harm our business.
If we are unable to protect or enforce our intellectual property rights, or if our services or solutions infringe upon the intellectual property rights of others or we lose our ability to utilize the intellectual property of others, our business could be adversely affected.
We are incorporated in Ireland and Irish law differs from the laws in effect in the United States and might afford less protection to our shareholders. We may also be subject to criticism and negative publicity related to our incorporation in Ireland.

For a more detailed discussion of these factors, see the information under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended August 31, 2024, as updated in Item 1A, “Risk Factors” in this Quarterly Report on Form 10-Q. Our forward-looking statements speak only as of the date of this report or as of the date they are made, and we undertake no obligation to update any forward-looking statements.


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Overview

Accenture is a leading global professional services company, providing a broad range of services and solutions across Strategy & Consulting, Technology, Operations, Industry X and Song. We serve clients in three geographic markets: the Americas, EMEA (Europe, Middle East and Africa) and Asia Pacific. We combine our strength in technology and leadership in cloud, data and AI with unmatched industry experience, functional expertise and global delivery capability to help the world’s leading businesses, governments and other organizations build their digital core, optimize their operations, accelerate revenue growth and enhance citizen services—creating tangible value at speed and scale.

Our results of operations are affected by economic conditions, including macroeconomic conditions, the overall inflationary environment and levels of business confidence. We are seeing an elevated level of what was already significant economic and geopolitical uncertainty in many markets around the world, which has impacted and may continue to impact our business. These conditions have slowed the pace and level of client spending, particularly for smaller contracts with a shorter duration and for our consulting services. Clients continue to prioritize large-scale transformations, which convert to revenue over a longer period.

For a discussion of risks related to these and other recent developments, see Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the year ended August 31, 2024, as updated in Item 1A, “Risk Factors” in this Quarterly Report on Form 10-Q.

Key Metrics

Key metrics for the second quarter of fiscal 2025 compared to the second quarter of fiscal 2024 are included below. We have presented operating income, operating margin, effective tax rate and diluted earnings per share for the second quarter of fiscal 2024 on a non-GAAP or “adjusted” basis to exclude the impact of $115 million in business optimization costs recorded during the quarter, as discussed further in our Results of Operations.

Revenues of $16.7 billion, an increase of 5% in U.S. dollars and 8.5% in local currency;
New bookings of $20.9 billion, a decrease of 3% in U.S. dollars and flat in local currency;
Operating margin of 13.5%, compared to operating margin of 13.0% and adjusted operating margin of 13.7% in the second quarter of fiscal 2024;
Diluted earnings per share of $2.82, a 7% increase over diluted earnings per share of $2.63 and a 2% increase over adjusted earnings per share of $2.77 in the second quarter of fiscal 2024; and
Cash returned to shareholders of $2.4 billion, including dividends of $929 million and share purchases of $1.4 billion.

Revenues


			Three Months Ended						Percent Increase (Decrease) U.S. Dollars				Percent Increase (Decrease) Local Currency				Percent of Revenues for the Three Months Ended
(in billions of U.S. dollars)			February 28, 2025		February 29, 2024								February 28, 2025		February 29, 2024

Geographic Markets	Americas (1)		$	8.6	$	7.8			9	%			11	%			51	%			49	%
EMEA	5.8		5.6				4				8				35				35
Asia Pacific (1)	2.3		2.4				(3)				1				14				15
Total Revenues	$	16.7	$	15.8			5	%			8.5	%			100	%			100	%


Industry Groups	Communications, Media & Technology		$	2.7	$	2.7			3	%			6	%			16	%			17	%
Financial Services	3.0		2.8				7				11				18				18
Health & Public Service	3.6		3.3				8				10				22				21
Products	5.1		4.8				6				9				30				30
Resources	2.3		2.2				1				5				14				14
Total Revenues	$	16.7	$	15.8			5	%			8.5	%			100	%			100	%


Type of Work	Consulting		$	8.3	$	8.0			3	%			6	%			50	%			51	%
Managed Services	8.4		7.8				8				11				50				49
Total Revenues	$	16.7	$	15.8			5	%			8.5	%			100	%			100	%

Amounts in table may not total due to rounding.

(1)During the first quarter of fiscal 2025, our Latin America market unit moved from Growth Markets to North America. With this change, North America became the Americas market and Growth Markets became the Asia Pacific market. Prior period amounts have been reclassified to conform with the current period presentation.


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Revenues for the second quarter of fiscal 2025 increased 5% in U.S. dollars and 8.5% in local currency compared to the second quarter of fiscal 2024. During the second quarter of fiscal 2025, revenue growth in local currency was very strong in the Americas and EMEA, while Asia Pacific experienced slight growth. We experienced local currency revenue growth that was very strong in Financial Services, Health & Public Service and Products, strong in Communications, Media & Technology and solid in Resources. Revenue growth in local currency was very strong in managed services and strong in consulting. While the business environment remained competitive, pricing was relatively stable. We define pricing as the contract profitability or margin on the work that we sell.

In our consulting business, revenues for the second quarter of fiscal 2025 increased 3% in U.S. dollars and 6% in local currency compared to the second quarter of fiscal 2024. Consulting revenue growth in local currency for the second quarter of fiscal 2025 was driven by very strong growth in the Americas and strong growth in EMEA, partially offset by a modest decline in Asia Pacific. Our consulting revenue continues to be driven by helping our clients accelerate their reinvention, in particular technology, data, and AI led digital transformations. This includes moving to the cloud, embedding security and responsible AI across the enterprise and leveraging our change capabilities to help our clients build new skills and drive the successful adoption of new processes and technologies. In addition, clients continue to be focused on initiatives designed to deliver cost savings and supply chain and operational resilience, as well as projects to accelerate growth and improve customer experiences. While we continue to experience demand for these services, we are seeing a slower pace and level of client spending, particularly for smaller contracts with a shorter duration.

In our managed services business, revenues for the second quarter of fiscal 2025 increased 8% in U.S. dollars and 11% in local currency compared to the second quarter of fiscal 2024. Managed services revenue growth in local currency for the second quarter of fiscal 2025 was driven by very strong growth in the Americas and EMEA and strong growth in Asia Pacific. We continue to experience growing demand to assist clients with application modernization and maintenance, cloud enablement and cybersecurity-as-a-service. In addition, clients continue to be focused on transforming their operations through technology, data and AI, and leveraging our digital platforms and talent to drive productivity and operational cost savings.

As we are a global company, our revenues are denominated in multiple currencies and may be significantly affected by currency exchange rate fluctuations. While a significant portion of our revenues are in U.S. dollars, the majority of our revenues are denominated in other currencies, including the Euro, Japanese yen and U.K. pound. There continues to be volatility in foreign currency exchange rates. Unfavorable fluctuations in foreign currency exchange rates have had and could in the future have a material effect on our financial results. If the U.S. dollar weakens against other currencies, resulting in favorable currency translation, our revenues, revenue growth and results of operations in U.S. dollars may be higher. If the U.S. dollar strengthens against other currencies, resulting in unfavorable currency translation, our revenues, revenue growth and results of operations in U.S. dollars may be lower. The U.S. dollar strengthened against various currencies during the three and six months ended February 28, 2025 compared to the three and six months ended February 29, 2024, resulting in unfavorable currency translation and U.S. dollar revenue growth that was approximately 3% and 1% lower, respectively, than our revenue growth in local currency. Assuming that exchange rates stay within recent ranges for the remainder of fiscal 2025, we estimate that our full fiscal 2025 revenue growth in U.S. dollars will be approximately 0.5% lower than our revenue growth in local currency.

People Metrics



Utilization	Workforce	Annualized Voluntary Attrition
91%	801,000+	13%
compared to 92% in the second quarter of fiscal 2024	compared to approximately 742,000 as of February 29, 2024	consistent with the second quarter of fiscal 2024

Utilization for the second quarter of fiscal 2025 was 91%, compared to 92% in the second quarter of fiscal 2024. We hire to meet current and projected future demand. We proactively plan and manage the size and composition of our workforce and take actions as needed to address changes in the anticipated demand for our services and solutions, given that compensation costs are the most significant portion of our operating expenses. Our workforce, the majority of which serves our clients, increased to approximately 801,000 as of February 28, 2025, compared to approximately 742,000 as of February 29, 2024. The year-over-year increase in our workforce reflects hiring for the skills needed to support demand for our services and solutions, as well as people added in connection with acquisitions.

For the second quarter of fiscal 2025, annualized attrition, excluding involuntary terminations, was 13%, consistent with the second quarter of fiscal 2024. We evaluate voluntary attrition, adjust levels of new hiring and use involuntary terminations as a means to keep our supply of skills and resources in balance with changes in client demand.


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In addition, we adjust compensation to provide market relevant pay based on the skills of our people and locations where we operate. We also consider a variety of factors, including the macroeconomic environment, in making our decisions around pay and benefits. We strive to adjust pricing as well as drive cost and delivery efficiencies, such as changing the mix of people and utilizing technology, to reduce the impact of compensation increases on our margin and contract profitability.

Our ability to grow our revenues and maintain or increase our margin could be adversely affected if we are unable to: match people and skills with the types or amounts of services and solutions clients are demanding; recover or offset increases in compensation; deploy our employees globally on a timely basis; manage attrition; and/or effectively assimilate new employees.

New Bookings


	Three Months Ended				Percent Increase (Decrease) U.S. Dollars		Percent Increase (Decrease) Local Currency			Six Months Ended				Percent Increase (Decrease) U.S. Dollars		Percent Increase (Decrease) Local Currency
(in billions of U.S. dollars)	February 28, 2025		February 29, 2024				February 28, 2025		February 29, 2024
Consulting	$	10.5	$	10.5	(1)	%	2	%		$	19.7	$	19.1	3	%	4	%
Managed Services	10.4		11.1		(6)		(2)			19.9		20.9		(5)		(3)
Total New Bookings	$	20.9	$	21.6	(3)	%	—	%		$	39.6	$	40.0	(1)	%	—	%

We provide information regarding our new bookings, which include new contracts, including those acquired through acquisitions, as well as renewals, extensions and changes to existing contracts, because we believe doing so provides useful trend information regarding changes in the volume of our new business over time. New bookings can vary significantly quarter to quarter depending in part on the timing of the signing of a small number of large managed services contracts. The types of services and solutions clients are demanding and the pace and level of their spending may impact the conversion of new bookings to revenues. For example, managed services bookings, which are typically for multi-year contracts, generally convert to revenue over a longer period of time compared to consulting bookings.

Information regarding our new bookings is not comparable to, nor should it be substituted for, an analysis of our revenues over time. New bookings involve estimates and judgments. There are no third-party standards or requirements governing the calculation of bookings. We do not update our new bookings for material subsequent terminations or reductions related to bookings originally recorded in prior fiscal years. New bookings are recorded using then-existing foreign currency exchange rates and are not subsequently adjusted for foreign currency exchange rate fluctuations.

The majority of our contracts are terminable by the client on short notice with little or no termination penalties, and some without notice. Only the non-cancelable portion of these contracts is included in our remaining performance obligations disclosed in Note 2 (Revenues) to our Consolidated Financial Statements under Item 1, “Financial Statements.” Accordingly, a significant portion of what we consider contract bookings is not included in our remaining performance obligations.


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Results of Operations for the Three and Six Months Ended February 28, 2025 Compared to the Three and Six Months Ended February 29, 2024

Revenues

Revenues by geographic market, industry group and type of work are as follows:


	Three Months Ended				Percent Increase (Decrease) U.S. Dollars		Percent Increase (Decrease) Local Currency		Six Months Ended				Percent Increase (Decrease) U.S. Dollars		Percent Increase (Decrease) Local Currency
(in millions of U.S. dollars)	February 28, 2025		February 29, 2024		February 28, 2025		February 29, 2024
Geographic Markets
Americas (1)	$	8,553	$	7,816	9	%	11	%	$	17,286	$	15,843	9	%	11	%
EMEA	5,804		5,599		4		8		12,216		11,402		7		7
Asia Pacific (1)	2,302		2,385		(3)		1		4,847		4,779		1		2
Total	$	16,659	$	15,800	5	%	8.5	%	$	34,349	$	32,024	7	%	8.3	%
Industry Groups
Communications, Media & Technology	$	2,730	$	2,654	3	%	6	%	$	5,588	$	5,324	5	%	6	%
Financial Services	3,010		2,809		7		11		6,179		5,843		6		7
Health & Public Service	3,609		3,334		8		10		7,422		6,712		11		11
Products	5,052		4,762		6		9		10,477		9,622		9		9
Resources	2,258		2,241		1		5		4,683		4,524		4		5
Total	$	16,659	$	15,800	5	%	8.5	%	$	34,349	$	32,024	7	%	8.3	%
Type of Work
Consulting	$	8,282	$	8,021	3	%	6	%	$	17,327	$	16,478	5	%	6	%
Managed Services	8,377		7,778		8		11		17,021		15,546		9		11
Total	$	16,659	$	15,800	5	%	8.5	%	$	34,349	$	32,024	7	%	8.3	%

Amounts in table may not total due to rounding.

Geographic Markets

The following revenues commentary discusses the primary drivers of local currency revenue changes by geographic market for the three and six months ended February 28, 2025 compared to the three and six months ended February 29, 2024:

Americas

Three Months. Revenues increased 11% in local currency, led by growth in Banking & Capital Markets, Industrial, Health and Consumer Goods, Retail & Travel Services. Revenue growth was driven by the United States.
Six Months. Revenues increased 11% in local currency, led by growth in Industrial, Banking & Capital Markets, Software & Platforms and Consumer Goods, Retail & Travel Services. Revenue growth was driven by the United States, as well as Argentina, which continued to grow in local currency due primarily to hyperinflation.

EMEA

Three Months. Revenues increased 8% in local currency, led by growth in Public Service, Life Sciences and Consumer Goods, Retail & Travel Services. Revenue growth was driven by the United Kingdom.
Six Months. Revenues increased 7% in local currency, led by growth in Public Service, Life Sciences, Consumer Goods, Retail & Travel Services and Health. Revenue growth was driven by the United Kingdom and Italy, partially offset by a decline in France.

Asia Pacific

Three Months. Revenues increased 1% in local currency, led by growth in Insurance and Utilities, partially offset by a decline in Chemicals & Natural Resources. Revenue growth was driven by Japan, partially offset by a decline in Singapore.


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Six Months. Revenues increased 2% in local currency, led by growth in Utilities, Insurance and Industrial, partially offset by a decline in Chemicals & Natural Resources. Revenue growth was driven by Japan, partially offset by a decline in Singapore.

Operating Expenses

Operating expenses for the second quarter of fiscal 2025 increased $662 million, or 5%, compared to the second quarter of fiscal 2024, and decreased as a percentage of revenues to 86.5% from 87.0% during this period. Operating expenses for the six months ended February 28, 2025 increased $1,743 million, or 6%, compared to the six months ended February 29, 2024, and decreased as a percentage of revenues to 84.9% from 85.6% during this period.

The primary categories of operating expenses include Cost of services, Sales and marketing and General and administrative costs. Cost of services is primarily driven by the cost of people serving our clients, which consists mainly of compensation, subcontractor and other payroll costs, and non-payroll costs such as facilities, technology and travel. Cost of services includes a variety of activities such as: contract delivery; recruiting and training; software development; and integration of acquisitions. Sales and marketing costs are driven primarily by compensation costs for business development activities; marketing- and advertising-related activities; and certain acquisition-related costs. General and administrative costs primarily include costs for people that are non-client-facing, information systems, office space and certain acquisition-related costs.

Operating expenses by category are as follows:


	Three Months Ended										Six Months Ended
(in millions of U.S. dollars)	February 28, 2025				February 29, 2024				Increase (Decrease)		February 28, 2025				February 29, 2024				Increase (Decrease)
Operating Expenses	$	14,415	86.5	%	$	13,753	87.0	%	$	662	$	29,156	84.9	%	$	27,413	85.6	%	$	1,743
Cost of services	11,684		70.1		10,921		69.1		763		23,551		68.6		21,697		67.8		1,854
Sales and marketing	1,677		10.1		1,631		10.3		46		3,488		10.2		3,341		10.4		147
General and administrative costs	1,053		6.3		1,085		6.9		(32)		2,117		6.2		2,119		6.6		(2)
Business optimization costs	—		—		115		0.7		(115)		—		—		255		0.8		(255)

Amounts in table may not total due to rounding.

Cost of Services

Cost of services for the second quarter of fiscal 2025 increased $763 million, or 7%, over the second quarter of fiscal 2024, and increased as a percentage of revenues to 70.1% compared to 69.1% during this period. Gross margin for the second quarter of fiscal 2025 decreased as a percentage of revenues to 29.9% from 30.9% during the second quarter of fiscal 2024. The decrease in gross margin was primarily due to higher subcontractor costs and the impact of our business optimization actions which reduced severance costs in gross margin during the second quarter of fiscal 2024.

Cost of services for the six months ended February 28, 2025 increased $1,854 million, or 9%, over the six months ended February 29, 2024, and increased as a percentage of revenues to 68.6% compared to 67.8% during this period. Gross margin for the six months ended February 28, 2025 decreased as a percentage of revenues to 31.4% from 32.2% during the six months ended February 29, 2024. The decrease in gross margin was primarily due to higher subcontractor costs and the impact of our business optimization actions which reduced severance costs in gross margin during the six months ended February 29, 2024.

Sales and Marketing

Sales and marketing expense for the second quarter of fiscal 2025 increased $46 million, or 3%, over the second quarter of fiscal 2024, and decreased as a percentage of revenues to 10.1% from 10.3% during this period. Sales and marketing expense for the six months ended February 28, 2025 increased $147 million, or 4%, over the six months ended February 29, 2024, and decreased as a percentage of revenues to 10.2% from 10.4% during this period. The decrease as a percentage of revenues for the three and six months ended February 28, 2025 was primarily due to lower labor costs compared to the same periods in fiscal 2024.

General and Administrative Costs

General and administrative costs for the second quarter of fiscal 2025 decreased $32 million, or 3%, from the second quarter of fiscal 2024, and decreased as a percentage of revenues to 6.3% from 6.9% during this period. General and administrative costs for the six months ended February 28, 2025 decreased $2 million from the six months ended February 29, 2024, and decreased as a percentage of revenues to 6.2% from 6.6% during this period. The decrease as a percentage of revenues for the three and six months ended February 28, 2025 was primarily due to lower labor costs compared to the same periods in fiscal 2024.

Business Optimization Costs

During the second quarter of fiscal 2023, we initiated actions to streamline our operations, transform our non-billable corporate functions and consolidate our office space to reduce costs. We recorded a total of $1.5 billion related to these actions, primarily for employee severance, which have been completed as of August 31, 2024.


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Non-GAAP Financial Measures

We have presented operating income, operating margin, effective tax rate and diluted earnings per share on a non-GAAP or “adjusted” basis excluding the business optimization costs recorded in fiscal 2024 as we believe doing so facilitates understanding as to the impact of this item and our performance in comparison to the prior periods. While we believe that this non-GAAP financial information is useful in evaluating our operations, this information should be considered as supplemental in nature and not as a substitute for the related financial information prepared in accordance with GAAP.

Operating Income and Operating Margin

Operating income and operating margin for each of the geographic markets are as follows:


	Three Months Ended										Six Months Ended
	February 28, 2025				February 29, 2024						February 28, 2025				February 29, 2024
(in millions of U.S. dollars)	Operating Income		Operating Margin		Operating Income		Operating Margin		Increase (Decrease)		Operating Income		Operating Margin		Operating Income		Operating Margin		Increase (Decrease)
Americas (1)	$	1,240	15	%	$	1,083	14	%	$	157	$	2,618	15	%	$	2,376	15	%	$	241
EMEA	639		11		529		9		110		1,675		14		1,353		12		323
Asia Pacific (1)	365		16		434		18		(69)		900		19		882		18		18
Total	$	2,245	13.5	%	$	2,046	13.0	%	$	198	$	5,193	15.1	%	$	4,611	14.4	%	$	582

Amounts in table may not total due to rounding.

Operating income for the second quarter of fiscal 2025 increased $198 million, or 10%, compared with the second quarter of fiscal 2024. Operating margin for the second quarter of fiscal 2025 was 13.5%, compared with 13.0% for the second quarter of fiscal 2024. Operating income for the six months ended February 28, 2025 increased $582 million, or 13%, compared with the six months ended February 29, 2024. Operating margin for the six months ended February 28, 2025 was 15.1%, compared with 14.4% for the six months ended February 29, 2024.

Geographic Markets

We estimate that the aggregate percentage impact of foreign currency exchange rates on our operating income during the three and six months ended February 28, 2025 was similar to that disclosed for revenue for each geographic market. Additionally, costs associated with our business optimization actions did not impact fiscal 2025 operating income as the actions were completed in fiscal 2024. The commentary below provides insight into other factors affecting geographic market performance and operating income for the three and six months ended February 28, 2025 compared with the three and six months ended February 29, 2024:

Americas

Three Months. Operating income increased primarily due to revenue growth, partially offset by a decline in contract profitability.
Six Months. Operating income increased primarily due to revenue growth, partially offset by a decline in contract profitability.

EMEA

Three Months. Operating income increased primarily due to revenue growth, partially offset by a decline in contract profitability.
Six Months. Operating income increased primarily due to revenue growth, partially offset by a decline in contract profitability.

Asia Pacific

Three Months. Operating income decreased primarily due to a decline in contract profitability.
Six Months. Operating income was relatively flat as revenue growth was offset by a decline in contract profitability.


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Operating Income and Operating Margin Excluding Fiscal 2024 Business Optimization Costs (Non-GAAP)

The business optimization costs reduced operating margin for the second quarter of fiscal 2024 by 70 basis points. Operating margin for the second quarter of fiscal 2025 was 13.5% compared to adjusted operating margin for the second quarter of fiscal 2024 of 13.7%. The business optimization costs reduced operating margin for the six months ended February 29, 2024 by 80 basis points. Operating margin for the six months ended February 28, 2025 was 15.1% compared to adjusted operating margin for the six months ended February 29, 2024 of 15.2%.


	Three Months Ended
	February 28, 2025				February 29, 2024
(in millions of U.S. dollars)	Operating Income (GAAP)		Operating Margin (GAAP)		Operating Income (GAAP)		Business Optimization (1)		Operating Income (Non-GAAP)		Operating Margin (Non-GAAP)		Increase (Decrease)
Americas (2)	$	1,240	15	%	$	1,083	$	12	$	1,095	14	%	$	145
EMEA	639		11		529		86		615		11		25
Asia Pacific (2)	365		16		434		18		452		19		(87)
Total	$	2,245	13.5	%	$	2,046	$	115	$	2,162	13.7	%	$	83


	Six Months Ended
	February 28, 2025				February 29, 2024
(in millions of U.S. dollars)	Operating Income (GAAP)		Operating Margin (GAAP)		Operating Income (GAAP)		Business Optimization (1)		Operating Income (Non-GAAP)		Operating Margin (Non-GAAP)		Increase (Decrease)
Americas (2)	$	2,618	15	%	$	2,376	$	62	$	2,438	15	%	$	180
EMEA	1,675		14		1,353		156		1,509		13		166
Asia Pacific (2)	900		19		882		37		919		19		(19)
Total	$	5,193	15.1	%	$	4,611	$	255	$	4,866	15.2	%	$	327

Amounts in tables may not total due to rounding.

(1)Costs recorded in connection with our business optimization initiatives, primarily for employee severance.

(2)During the first quarter of fiscal 2025, our Latin America market unit moved from Growth Markets to North America. With this change, North America became the Americas market and Growth Markets became the Asia Pacific market. Prior period amounts have been reclassified to conform with the current period presentation.

Interest Income

Interest income for the second quarter of fiscal 2025 was $76 million, an increase of $11 million, or 17%, over the second quarter of fiscal 2024. The increase was primarily due to a higher average cash balance. Interest income for the six months ended February 28, 2025 was $152 million, a decrease of $15 million or 9% from the six months ended February 29, 2024. The decrease was primarily due to lower interest rates and a lower average cash balance.

Interest Expense

Interest expense for the second quarter of fiscal 2025 was $65 million, an increase of $54 million over the second quarter of fiscal 2024. Interest expense for the six months ended February 28, 2025 was $95 million, an increase of $70 million over the six months ended February 29, 2024. The increase for the three and six months ended February 28, 2025 was primarily due to an increase in long-term debt compared to the three and six months ended February 29, 2024.

Other Income (Expense), net

Other income (expense), net primarily consists of foreign currency gains and losses, non-operating components of pension expense, as well as gains and losses associated with our investments. During the three and six months ended February 28, 2025, Other income (expense), net increased $38 million and $35 million over the three and six months ended February 29, 2024, respectively, primarily due to lower foreign currency exchange losses. For additional information, see Note 1 (Basis of Presentation) to our Consolidated Financial Statements under Item 1, “Financial Statements."

Income Tax Expense

The effective tax rates for the second quarter of fiscal 2025 and 2024 were 20.4% and 18.4%, respectively. The higher effective tax rate was primarily due to lower tax benefits from share-based payments. The effective tax rate for both the six months ended February 28, 2025 and February 29, 2024 was 21.1%.


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ACCENTURE FORM 10-Q						Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			32

Income Tax Expense Excluding Fiscal 2024 Business Optimization Costs (Non-GAAP)

Excluding the business optimization costs of $115 million and $255 million, and related reduction in tax expense of $28 million and $62 million, our adjusted effective tax rates were 18.8% and 21.2% for the three and six months ended February 29, 2024, respectively.

Earnings Per Share

Diluted earnings per share were $2.82 for the second quarter of fiscal 2025, compared with $2.63 for the second quarter of fiscal 2024. Diluted earnings per share were $6.42 for the six months ended February 28, 2025, compared with $5.73 for the six months ended February 29, 2024. For information regarding our earnings per share calculations, see Note 3 (Earnings Per Share) to our Consolidated Financial Statements under Item 1, “Financial Statements.”

Earnings Per Share Excluding Fiscal 2024 Business Optimization Costs (Non-GAAP)

The business optimization costs of $87 million and $193 million, net of related taxes, decreased diluted earnings per share by $0.14 and $0.30 for the three and six months ended February 29, 2024, respectively. Adjusted diluted earnings per share were $2.77 and $6.04 for the three and six months ended February 29, 2024, respectively.


	Three Months Ended		Six Months Ended
February 29, 2024 As Reported	$	2.63	$	5.73
Business optimization costs	0.18		0.40
Tax effect of business optimization costs (1)	(0.04)		(0.10)
February 29, 2024 As Adjusted	$	2.77	$	6.04

February 28, 2025 As Reported	$	2.82	$	6.42

Amounts in tables may not total due to rounding.

(1)The income tax effect of business optimization costs includes both the current and deferred income tax impact and was calculated by using the relevant tax rate of the country where the adjustments were recorded.

Changes in diluted earnings per share for the three and six months ended February 28, 2025 compared to adjusted diluted earnings per share for the three and six months ended February 29, 2024 were due to the following factors:


	Three Months Ended		Six Months Ended
February 29, 2024 As Adjusted	$	2.77	$	6.04
Revenue and operating results	0.11		0.40
Lower share count	0.01		0.03
Non-operating income	(0.01)		(0.06)
Effective tax rate	(0.06)		0.01
February 28, 2025 As Reported	$	2.82	$	6.42

Liquidity and Capital Resources

As of February 28, 2025, Cash and cash equivalents was $8.5 billion, compared with $5.0 billion as of August 31, 2024.

Cash flows from operating, investing and financing activities, as reflected in our Consolidated Cash Flows Statements, are summarized in the following table:


	Six Months Ended
(in millions of U.S. dollars)	February 28, 2025		February 29, 2024		Change
Net cash provided by (used in):
Operating activities	$	3,876	$	2,600	$	1,276
Investing activities	(793)		(3,064)		2,271
Financing activities	547		(3,418)		3,964
Effect of exchange rate changes on cash and cash equivalents	(144)		(42)		(102)
Net increase (decrease) in cash and cash equivalents	$	3,486	$	(3,924)	$	7,410

Amounts in table may not total due to rounding.


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ACCENTURE FORM 10-Q						Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			33

Operating activities: The $1,276 million increase in operating cash flows was primarily due to higher net income and changes in operating assets and liabilities, including lower spending on certain compensation payments.

Investing activities: The $2,271 million decrease in cash used was primarily due to lower spending on business acquisitions. For additional information, see Note 5 (Business Combinations) to our Consolidated Financial Statements under Item 1, “Financial Statements.”

Financing activities: The $3,964 million increase in financing cash flows was primarily due to net proceeds from borrowings. For additional information, see Note 9 (Borrowings and Indebtedness) to our Consolidated Financial Statements under Item 1, “Financial Statements.”

We believe that our current and longer-term working capital, investments and other general corporate funding requirements will be satisfied for the next twelve months and thereafter through cash flows from operations and, to the extent necessary, from our borrowing facilities and future financial market activities.

Substantially all of our cash is held in jurisdictions where there are no regulatory restrictions or material tax effects on the free flow of funds. Domestic cash inflows for our Irish parent, principally dividend distributions from lower-tier subsidiaries, have been sufficient to meet our historic cash requirements, and we expect this to continue into the future.

Borrowings and Indebtedness

On September 30, 2024, we filed a registration statement on Form S-3, pursuant to which Accenture plc’s wholly owned finance subsidiaries Accenture Capital and Accenture Global Capital DAC may issue debt securities. As of February 28, 2025, we had outstanding long-term debt in the form of senior unsecured notes issued by Accenture Capital in an aggregate principal amount of $5 billion, which mature from 2027 through 2034. Accenture plc fully and unconditionally guarantees these notes, as well as all future debt securities that may be issued by these entities.

For additional information regarding our outstanding borrowings, credit facilities and other debt, see Note 9 (Borrowings and Indebtedness) to our Consolidated Financial Statements under Item 1, “Financial Statements.”

Share Purchases and Redemptions

The Board of Directors of Accenture plc has authorized funding for our publicly announced open-market share purchase program for acquiring Accenture plc Class A ordinary shares and for purchases and redemptions of Accenture plc Class A ordinary shares and Accenture Canada Holdings Inc. exchangeable shares held by current and former members of Accenture Leadership and their permitted transferees.

Our share purchase activity during the six months ended February 28, 2025 is as follows:


	Accenture plc Class A Ordinary Shares			Accenture Canada Holdings Inc. Exchangeable Shares
(in millions of U.S. dollars, except share amounts)	Shares	Amount		Shares	Amount
Open-market share purchases (1)	4,611,999	$	1,656	—	$	—
Other share purchase programs	—	—		11,311	4
Other purchases (2)	1,915,647	686		—	—
Total	6,527,646	$	2,342	11,311	$	4

(1)We conduct a publicly announced open-market share purchase program for Accenture plc Class A ordinary shares. These shares are held as treasury shares by Accenture plc and may be utilized to provide for select employee benefits, such as equity awards to our employees.

(2)During the six months ended February 28, 2025, as authorized under our various employee equity share plans, we acquired Accenture plc Class A ordinary shares primarily via share withholding for payroll tax obligations due from employees and former employees in connection with the delivery of Accenture plc Class A ordinary shares under those plans. These purchases of shares in connection with employee share plans do not affect our aggregate available authorization for our publicly announced open-market share purchase and the other share purchase programs.

We intend to continue to use a significant portion of cash generated from operations for share repurchases during the remainder of fiscal 2025. The number of shares ultimately repurchased under our open-market share purchase program may vary depending on numerous factors, including, without limitation, share price and other market conditions, our ongoing capital allocation planning, the levels of cash and debt balances, other demands for cash, such as acquisition activity, general economic and/or business conditions, and board and management discretion. Additionally, as these factors may change over the course of the year, the amount of share repurchase activity during any particular period cannot be predicted and may fluctuate from time to time. Share repurchases may be made from time to time through open-market purchases, in respect of purchases and redemptions of Accenture Canada Holdings Inc. exchangeable shares, through the use of Rule 10b5-1 plans and/or by other means. The repurchase program may be accelerated, suspended, delayed or discontinued at any time, without notice.


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ACCENTURE FORM 10-Q						Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			34

Off-Balance Sheet Arrangements

In the normal course of business and in conjunction with some client engagements, we have entered into contractual arrangements through which we may be obligated to indemnify clients with respect to certain matters.

To date, we have not been required to make any significant payment under any of the arrangements described above. For further discussion of these transactions, see Note 11 (Commitments and Contingencies) to our Consolidated Financial Statements under Item 1, “Financial Statements.”

Significant Accounting Policies

See Note 1 (Basis of Presentation) to our Consolidated Financial Statements under Item 1, “Financial Statements.”


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ACCENTURE FORM 10-Q						Item 3. Quantitative and Qualitative Disclosures About Market Risk			35

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