Accenture plc (Accenture (ACN)) had a rough Thursday. The consulting and tech services giant reported fiscal third-quarter results that beat earnings expectations but missed on revenue, and then served up a weaker-than-expected outlook that sent investors running for the exits.

The stock tumbled as the market focused on the soft guidance, a hawkish Federal Reserve that's been pressuring IT stocks, and the company's plan to spend $4.18 billion on cybersecurity acquisitions.

Third-Quarter Earnings

Accenture earned $3.80 per share in the quarter, topping analysts' estimates of $3.69. Revenue came in at $18.72 billion, up 6% in U.S. dollars (or 3% in local currency) from a year ago, but just shy of the $18.75 billion consensus.

Segment Performance

Consulting revenue rose 4% in U.S. dollars (1% in local currency) to $9.33 billion. Managed Services revenue climbed 8% in U.S. dollars (5% in local currency) to $9.39 billion.

Breaking it down by industry: Products revenue grew 6% to $5.67 billion; Health & Public Service revenue increased 2% to $3.85 billion; Financial Services revenue rose 6% to $3.49 billion; Resources revenue advanced 3% to $2.50 billion; and Communications, Media & Technology posted the strongest growth, up 10% to $3.22 billion.

Bookings, Cash Flow, and Shareholder Returns

New bookings totaled $19.32 billion, down 2% from a year ago. Consulting bookings were $10.26 billion, and Managed Services bookings hit $9.06 billion.

Operating margin expanded 20 basis points to 17.0%. Accenture ended the quarter with $10.2 billion in cash and generated $3.60 billion in free cash flow.

The company returned $2.2 billion to shareholders through dividends and buybacks, including repurchasing 6 million shares. As of May 31, about $3.2 billion remained under its buyback authorization.

Cybersecurity Acquisition Strategy

Separately, Accenture agreed to buy majority stakes in Dragos and all of runZero and NetRise for a combined enterprise value of about $4.175 billion. The company said the deals will strengthen its cybersecurity capabilities for critical infrastructure like power grids, pipelines, manufacturing facilities, and data centers.

Updated Fiscal 2026 Outlook

For the full fiscal year 2026, Accenture narrowed its revenue guidance to $71.763 billion to $72.460 billion, down from the previous range of $71.763 billion to $73.157 billion. That fell well below analysts' estimate of $74.006 billion.

The company raised its adjusted earnings forecast to $13.78 to $13.90 per share, from $13.65 to $13.90. Analysts expect $13.85.

Accenture also increased its expected capital return for fiscal 2026 to at least $9.5 billion, up from at least $9.3 billion.

For the fiscal fourth quarter, the company expects revenue of $17.75 billion to $18.40 billion, compared with analysts' estimate of $18.47 billion.

Price Action

Accenture shares were down 16.81% at $129.79 at the time of publication Thursday, hitting a new 52-week low. The stock is feeling the heat from both its own outlook and a broader sell-off in IT stocks after the Fed's hawkish stance.