Accenture posted record second-quarter bookings of $22.1 billion and 8% revenue growth, but a 4.4-point currency tailwind did most of the work: local-currency revenue grew 4% and bookings just 1%, with managed-services bookings down 1%.
What happened
In the three months to February 28, 2026 — the second quarter of Accenture's fiscal 2026, which runs September 2025 to August 2026 — revenue was $18.04 billion, up 8% from $16.66 billion. New bookings, the value of contracts signed in the quarter, hit a second-quarter record of $22.11 billion. Operating income rose 11% to $2.49 billion and operating margin expanded to 13.8% from 13.5%. There was no severance charge this quarter, so the reported and adjusted figures are the same.
Both headline growth numbers, though, are considerably flattered by the currency translation. A weaker US dollar added 4.4 percentage points to revenue growth: in local currency — that is, before converting foreign revenue back into dollars — revenue grew 4%, not 8%. The bookings record is more striking still: $22.11 billion is +6% in dollars but only +1% in local currency, and managed services bookings actually declined 1% on that basis. The record is real, but it is mostly an exchange-rate record.
And despite operating income rising 11%, net income rose just 2% to $1.86 billion. The entire gap sits below the operating line, in tax and investment income.
Gross margin is the share of revenue left after the direct cost of delivering client work; operating margin is what remains after sales, marketing and administrative costs too, and before interest and tax. A basis point (bps) is one hundredth of a percentage point. Accenture's second quarter is seasonally its weakest for margin, so the meaningful comparison is this quarter's 13.8% against the year-earlier second quarter's 13.5%, not the drop from the first quarter's 15.3%.
Takeaway: Strip out the 4.4-point currency tailwind and this is a 4% local-currency growth quarter with flat-to-negative underlying bookings — total bookings +1% and managed services bookings −1% in local currency. Management nonetheless raised full-year local-currency revenue guidance to 3–5% from 2–5%, which means the raise rests on revenue already booked and on the consulting pipeline, not on the quarter's signings. Bookings are the leading indicator, and this quarter they stopped leading.
The bookings record deserves a closer look
$22.11 billion of bookings against $18.04 billion of revenue is a book-to-bill ratio of about 1.23 — $1.23 of new work signed per dollar of revenue recognised — which is a healthy absolute level, and 41 clients signed more than $100 million each, a company record.
But the composition inverted from the first quarter. Consulting bookings (project work, generally shorter-duration) rose 8% in dollars and 3% in local currency to $11.33 billion, while managed services bookings (multi-year contracts to run a client's processes or systems) rose 3% in dollars but fell 1% in local currency to $10.78 billion. Three months earlier the pattern was the exact opposite, with managed services bookings up 15% in local currency and consulting up 5%.
Bookings swing quarter to quarter on the timing of a handful of large managed-services signings, and Accenture says so directly in the filing — one quarter is not a trend. Across the first half the picture is steadier: $43.0 billion of bookings, up 5% in local currency, with managed services up 6% and consulting up 4%. Still, a 1% local-currency total is the weakest bookings growth in the recent run, and it is the number that matters most for fiscal 2027 revenue.
Accenture did not disclose an advanced-AI bookings figure this quarter, having reported $2.2 billion of them in the first quarter. Management described "strong AI-driven growth" without quantifying it — a disclosure step backwards that makes the AI contribution harder to size.
Where the revenue came from
Geographic market
Q2 FY2026 revenue
USD growth
Local-currency growth
Americas
$8.90B
+4%
+3%
EMEA
$6.57B
+13%
+2%
Asia Pacific
$2.58B
+12%
+10%
Total
$18.04B
+8%
+4%
EMEA is where the currency distortion is extreme: 13% growth in dollars, 2% in local currency. Eleven of those thirteen points are the euro and sterling translating more favourably, not more work being done. Asia Pacific is the genuine growth engine at 10% in local currency, led by Banking & Capital Markets, Communications & Media and Public Service, with Japan and Australia named as the drivers. The Americas slowed to 3% from 4% in the prior quarter, again with Public Service — specifically the US federal business — offsetting growth in Banking & Capital Markets, Software & Platforms and Industrials.
Industry group
Q2 FY2026 revenue
USD growth
Local-currency growth
Products
$5.48B
+8%
+3%
Health & Public Service
$3.67B
+2%
−1%
Financial Services
$3.40B
+13%
+7%
Communications, Media & Technology
$3.09B
+13%
+10%
Resources
$2.41B
+7%
+2%
Communications, Media & Technology accelerated to 10% local-currency growth from 8% and is now the fastest-growing industry group, overtaking Financial Services, which decelerated to 7% from 12%. Health & Public Service declined 1% for a second consecutive quarter — the same US federal drag.
By type of work, managed services revenue grew 5% in local currency to $9.18 billion and consulting grew 3% to $8.86 billion. Managed services has now been the faster-growing half for both quarters of the year.
Margin: real but narrow improvement
The 30 basis points of margin expansion came from the delivery line, not from overheads. Gross margin improved to 30.3% from 29.9% "primarily due to lower non-payroll costs, including lower subcontractor costs" — Accenture doing more of the work with its own people instead of buying it in. Sales and marketing fell to 9.7% of revenue from 10.1% on lower selling and business development costs.
Working against that, general and administrative costs rose 16% — far faster than the 8% revenue increase — to 6.7% of revenue from 6.3%, on higher non-payroll costs. Some of that is plausibly acquisition-related: Accenture spent $1.86 billion on acquisitions in the first half, and the filing notes acquisition-related costs sit in both the sales-and-marketing and G&A lines.
Regionally, all three markets improved operating income in the quarter: Americas to $1,393 million (16% margin, from 15%), EMEA to $677 million (10%, from 11% — income up but margin down, as the currency-inflated revenue base outgrew the profit), and Asia Pacific to $424 million (16% margin, flat, held back by higher non-payroll costs).
The workforce continues to shrink relative to output: about 786,000 people against 801,000 a year earlier, with utilisation — the share of employee time billed to clients — at 93% versus 91%. Voluntary attrition was flat at 13%.
Why an 11% operating gain became a 2% net gain
The year-over-year earnings bridge is unusually lopsided:
Driver
Effect on EPS
Higher revenue and operating results
+$0.31
Lower share count
+$0.05
Lower non-operating income
−$0.10
Higher effective tax rate
−$0.15
Net change
+$0.11
Operations delivered $0.31 per share of improvement; tax and investment income took $0.25 of it back. The tax rate rose to 24.3% from 20.4% on "reduced tax benefits from share-based payments and final determinations of prior year taxes" — the share-based-payment element is tied to the share price and vesting timing, so it is only partly within management's control. Other income swung to a $52 million loss from a $33 million gain on lower investment gains. Buybacks, which cut the diluted share count 1.8% to 622.6 million, contributed the remaining $0.05.
For the first half, the divergence is sharper still: revenue up 7% to $36.79 billion, but net income down slightly to $4.10 billion from $4.14 billion and EPS essentially flat at $6.47 against $6.42 — the combination of the Q1 severance charge and the higher tax rate having consumed the entire operating gain.
Cash was the quarter's genuine standout
Free cash flow — operating cash minus property and equipment spending — was $3.67 billion, up from $2.68 billion, on operating cash flow of $3.82 billion. The filing attributes the $1.6 billion first-half increase to "higher collections on net client balances," and the collections evidence supports it: days services outstanding, the average time to get paid, fell to 46 days from 48 a year earlier and 47 at the August year-end. That is working-capital discipline, not an accounting timing effect.
Accenture returned $2.7 billion to shareholders — $1.7 billion repurchasing 6.8 million shares and $1.0 billion in dividends at $1.63 a share, 10% above the fiscal 2025 rate — leaving $4.4 billion of buyback authorisation. Cash fell to $9.4 billion from $11.5 billion at the August year-end, with the $1.86 billion of first-half acquisitions the main other use.
What management expects next
For the third quarter, Accenture guided to revenue of $18.35–19.0 billion, or 1–5% growth in local currency, with a currency tailwind of roughly 2.5%.
For the full year, management raised three things and held the rest:
Full-year FY2026 guidance
As of March 19, 2026
As of December 18, 2025
Revenue growth (local currency)
3–5%
2–5%
GAAP diluted EPS
$13.25–13.50
$13.12–13.50
Adjusted diluted EPS
$13.65–13.90
$13.52–13.90
Operating cash flow
$11.5–12.2B
$10.8–11.5B
Free cash flow
$10.8–11.5B
$9.8–10.5B
GAAP operating margin
15.2–15.4%
15.2–15.4%
Capital return
at least $9.3B
at least $9.3B
The raises are narrowings from the bottom rather than increases at the top — the revenue range lost its 2% floor, EPS lost its lowest cent — with one exception: free cash flow guidance went up a full billion dollars at both ends, and capital expenditure guidance came down to $0.7 billion from $1.0 billion. Management also noted the outlook reflects its view of the potential impact of the conflict in the Middle East in the second half, excluding any significant escalation.
Our read. The cash guidance raise is the most informative change: a billion dollars of additional free cash flow on unchanged margin guidance means it is coming from collections and lower capital spending, not from better profitability. That is worth real money but it is not growth. On growth, the tension in this quarter is unresolved — a 4% local-currency revenue quarter and a raised full-year floor on one side, a 1% local-currency bookings quarter and a managed-services bookings decline on the other. The revenue guidance floor can be raised on backlog already in hand; fiscal 2027 cannot. If the third quarter delivers another sub-2% local-currency bookings figure, the fiscal 2027 growth rate is the number at risk, and the fact that Accenture stopped quantifying its AI bookings in the quarter it slowed makes that harder to underwrite from the outside rather than easier.