"AI disrupts everything" sweeps through IT consulting and outsourcing! Accenture Plc Class A(ACN.US) performance outlook lower than expected, traditional "time and material billing" severely impacted.

The latest performance data released by the globally renowned IT service company Accenture Plc Class A (ACN.US) shows that the revenue outlook for the fourth quarter of the 2026 fiscal year is below the average expectations of Wall Street analysts. Additionally, this top-tier global technology consulting company reported an unexpected 2% decline in order volume in the third quarter, pointing to continued fundamental uncertainty in the industry market under the superstorm of "AI disruption everything" led by the AI application leader Anthropic, especially as the long-term "time and fee model" that the company relies on for survival may be completely overturned by AI intelligence. The company expects the revenue range for the three-month period ending in August to be between $17.75 billion and $18.4 billion, which is lower than the Wall Street analysts' consensus expectation of around $18.47 billion. The stock plummeted by over 17% in pre-market trading in New York from Wednesday's closing price of $156.01 per share, with a decline of 40% in the stock price since the beginning of the year under the continued pressure of the "AI disrupting everything" pessimistic narrative. The latest performance of Accenture Plc Class A highlights that AI is indeed wreaking havoc on the valuation framework of the IT consulting and outsourcing industry in which Accenture Plc Class A operates, but not simply destructing it. Instead, it is forcing the industry to shift from "selling time and labor" to "selling AI transformation, industry platforms, cybersecurity, and quantifiable business results". The short-term decline in stock price reflects the market's increasing concern that the transition speed may not keep up with the traditional business slowdown. The decline in orders and lackluster guidance of Accenture Plc Class A point to a critical moment for the time and fee model. According to a performance statement released on Thursday, the newly signed orders for the quarter ending on May 31 amounted to $19.3 billion, compared to $19.7 billion in the same period last year. The total revenue for the company's third quarter increased by $1 billion year-on-year to $18.7 billion, slightly below the Wall Street consensus estimate of $18.76 billion. The company also stated that its diluted earnings per share increased by 9% year-on-year to $3.80, slightly higher than the Wall Street analysts' consensus. Operating profit margin expanded by 20 basis points to 17.0%, and the latest quarterly free cash flow was $3.6 billion. These numbers themselves are not bad. But what truly disappointed the market was the orders and guidance, further raising doubts about the company's growth trajectory under the backdrop of "AI disrupting everything": new signed orders were $19.32 billion, down 2% year-on-year, and 3% at constant currency rates; Q4 revenue guidance is $17.75 billion to $18.4 billion, lower than market expectations; the forecasted annual total revenue growth at constant currency rates narrowed to 3%-4%, excluding the impact of about 1 percentage point from the US federal business, it would be 4%-5%. Accenture Plc Class A also agreed to acquire the majority ownership of the cybersecurity company Dragos, as well as the full ownership of runZero and NetRise, with a combined enterprise value of approximately $4.2 billion. Facing the market's skepticism towards the negative impact of AI application software and AI agents that gather work flows on its IT consulting business, Accenture Plc Class A's stock price has fallen by over 40% this year. Its competitors have also been hit hard, with IT outsourcing and consulting giants Capgemini SE and Infosys Ltd falling by over 30% this year. Bloomberg Intelligence stated that IT consulting demand is becoming increasingly weak, with the impact of AI being one factor, alongside the Middle East conflicts affecting companies' discretionary spending due to high energy and electricity costs. Accenture Plc Class A expects a revenue growth rate of 3% to 4% calculated at constant currency rates for the full year, with adjusted earnings per share in the range of $13.78 to $13.90. Accenture Plc Class A CEO Julie Sweet stated in a release that the company delivered a "strong third quarter." She added that the demand for large-scale "reshaping" brought about by AI technology remains strong, with 104 orders of $100 million or more from clients since the beginning of the year, representing a 13% increase. "We see more large-scale AI-related transformation projects, while executing our strategy to capture new growth areas," she said. The narrative of "AI disrupting everything" sweeping through global stock markets The impact of "AI disrupting everything" on Accenture Plc Class A is not that customers no longer need consulting services, but rather that customers are starting to reevaluate: which system integrations, code migrations, process outsourcing, testing, operations, and low-end consulting work can be replaced by AI agents, Claude/Codex flagship AI intelligence tools, enterprise internal platforms, or vertical AI software automation, significantly reducing the long-term premium of traditional time and fee billing models for IT services and consulting giants like Accenture Plc Class A. The strategic response of Accenture Plc Class A to this transformation pressure, represented by the acquisition of the majority ownership of Dragos for approximately $4.18-4.2 billion and the full acquisition of runZero and NetRise, is an attempt to move away from traditional consulting and outsourcing towards higher barriers in the AI era, focusing on industrial network security, asset intelligence, device security, and critical infrastructure protection. These acquired targets have a combined annual recurring revenue of about $208 million, and will expand Accenture Plc Class A's network security business by about $10 billion; the underlying logic of the acquisition is driven by AI threats and the heightened risks of GEO Group Inc, where security needs for "physical infrastructure" such as power grids, pipelines, factories, and data centers will become new growth points. Not only in the US stock market, but also in the global stock market, the IT services, outsourcing, and software sectors have been experiencing continuous declines since February under the panic of "AI disrupting everything". Despite a surge in share buybacks in the US software sector, investors remain unconvinced, as they are truly concerned about whether the long-term fundamentals and business models will be completely reshaped by AI. As a wave of innovative AI agents focusing on agent-based workflows is launched, they may disrupt one traditional industry after another, and suppress pricing power in the broader economy. Since the beginning of this year, worries about the "AI superstorm potentially compressing corporate profits, disrupting employment, and bringing about deflationary impacts" have rapidly spilled over into multiple traditional economic sectors, including software, private credit, real estate services, and insurance. The core factor behind the recent sell-off in software stocks and the successive declines in various sectors is undoubtedly the resounding pessimistic narrative of "AI disrupting everything". Since February, the "AI disrupting everything" narrative has swept through global financial markets, marking a powerful rise in the release of a series of AI tools/agent-based AI collaboration platforms by Anthropic, triggering a widespread sell-off in the SaaS subscription software sector and the software sector broadly. The fearsome "Anthropic storm" that has shaken software stocks began strictly earlier in February when Anthropic released a heavy legal plugin for its Claude Cowork, a widely popular agent-based AI intelligence tool. This super tool, which enables AI automation at extremely low technical thresholds for contract review, caused the market value of companies like Thomson Reuters Corporation and the parent company of LexisNexis, RELX, to evaporate by billions of dollars. The "Anthropic storm" that has devastated software stocks is still fermenting in global stock markets, and this sell-off is accelerating to any traditional industry that appears to be completely disrupted by AI, such as wealth consulting and management, real estate consulting, and any other sector. The market's pessimistic expectations of "AI disrupting everything" are spreading throughout different industry sectors like a domino effect, with software, SaaS, PE, insurance, wealth management, real estate, property management, and even logistics sectors all experiencing successive declines, as AI continues to sweep through traditional industries, causing investors to accelerate the sale of potential "losers."