Accenture’s shares tumbled more than 14% on Thursday after the IT consulting giant flagged the impact of the Iran war on its business, cut its annual growth outlook and forecast quarterly revenue below Wall Street expectations, triggering a selloff across the technology services sector.The company said the conflict had already cost it about $400 million in its Middle East business during the third quarter and warned that the disruption could continue in the months ahead.“The indirect impact really started in the last few weeks,” CEO Julie Sweet told Reuters on a post-earnings call. “It’s not clear how fast things will change, particularly because some of the industries are dealing with kind of longer-term issues.”Sweet said the automotive industry, a key client segment for Accenture, was already under pressure before higher fuel costs linked to the conflict added to its challenges.The weaker outlook weighed on the broader IT services sector. Shares of Infosys, Cognizant, Capgemini and IBM fell between 5.5% and 10.8% after Accenture also lowered its annual sales expectations.Geopolitical and economic uncertainty have dampened demand for technology projects in recent months, while concerns that autonomous AI tools could replace traditional software and consulting services have weighed on valuations across the industry.To offset the slowdown in consulting demand, Accenture announced cybersecurity acquisitions worth $4.18 billion, expanding its push into a segment it sees as a major growth opportunity.The company said it would acquire a majority stake in industrial cybersecurity firm Dragos and fully buy asset intelligence company runZero and device security specialist NetRise.With greater internet connectivity and wider adoption of artificial intelligence exposing factories, power grids and other critical infrastructure to cyber threats, companies are increasingly investing in security solutions.The acquisitions, expected to close in August or September subject to regulatory approvals, will add businesses generating a combined annual recurring revenue of $208 million.Accenture also said it plans to spend $9 billion on acquisitions this year, up from $5 billion previously, as it doubles down on AI, cloud and data businesses.The Dublin-headquartered company now expects annual revenue growth of 3-4%, compared with its earlier forecast of 3-5%.For the fourth quarter, it projected revenue of $17.75 billion to $18.4 billion, below analysts’ average estimate of $18.47 billion, according to LSEG data.In the third quarter, new bookings fell about 2% to $19.3 billion, while revenue rose 6% to $18.72 billion, missing analysts’ estimates of $18.75 billion.
