Accenture Plc reported a smaller quarterly profit, hurt in part by higher costs

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Consulting and outsourcing services provider Accenture Plc reported a smaller quarterly profit on Thursday, hurt in part by higher costs.

Shares of the company were down 2.7 percent at $123.11 before the bell. Operating costs rose 4.3 percent to $7.62 billion in the second quarter ended Feb. 28, reports Reuters.

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Accenture has been investing heavily in fast-growing businesses such as digital and cloud services, amid stiff competition from Cognizant Technology Solutions Corp and IBM.

The company forecast current-quarter revenue between $8.65 billion and $8.90 billion. Analysts on average were expecting revenue of $8.80 billion, according to Thomson Reuters I/B/E/S.

Net income attributable to Accenture fell to $838.8 million or $1.33 per share in the second quarter, from $1.33 billion or $2.08 per share, a year earlier. Profit in the year-ago quarter was benefited by a $553.6 million gain on the sale of some businesses.

Accenture’s net revenue rose 4.7 percent to $8.32 billion, helped by strong demand for its digital, cloud and security-related services, which make up more than 40 percent of revenue. Analysts on average had expected a second-quarter profit of $1.30 per share and revenue of $8.34 billion.

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