News

Accenture Cuts 11,000 Jobs While Betting Big on AI Skills

• By John K. Waters
• 09/26/2025

Dublin-based consulting firm Accenture has eliminated more than 11,000 positions over the past three months while simultaneously expanding its artificial intelligence workforce, illustrating the complex talent transitions reshaping the professional services industry.

The company, which employed 779,000 people at the end of August compared to 791,000 three months earlier, announced an $865 million restructuring program primarily focused on severance costs as it repositions its workforce for AI-driven client demands.

"We are exiting on a compressed timeline people where reskilling, based on our experience, is not a viable path for the skills we need," Chief Executive Julie Sweet told analysts during Thursday's earnings call.

Dual Strategy: Cut and Build
Despite the job cuts, Accenture expects overall headcount to increase in the coming fiscal year as it continues to hire in high-demand areas. The company has nearly doubled its number of AI and data specialists to 77,000 since fiscal 2023, while training over 550,000 employees in the fundamentals of generative AI.

The restructuring reflects broader industry dynamics as companies grapple with the rapidly evolving demands of technology. Similar patterns have emerged across major technology firms, where layoffs in traditional roles coincide with aggressive hiring in AI, cloud computing, and data analytics.

"Advanced AI is becoming a part of everything we do," Sweet said, describing the technology as "expansionary" rather than deflationary for the business.

Financial Impact
Accenture reported $69.7 billion in revenue for fiscal 2025, representing 7% growth from the previous year. However, the company's shares fell 2.7% Thursday to their lowest level since November 2020.

The restructuring charges totaled $615 million in the latest quarter, with an additional $250 million expected in the current three-month period. These cost savings will be reinvested in workforce development and business expansion, according to Angie Park, Chief Financial Officer.

Generative AI projects accounted for $5.1 billion of new bookings in fiscal 2025, up from $3 billion the previous year, demonstrating growing client appetite for AI-driven transformation services.

Market Challenges
The workforce adjustments come as Accenture navigates a challenging consulting market. While demand for large-scale digital transformation projects remains strong, companies have reduced their spending on shorter-term consulting engagements over the past two years.

The company also cited reduced U.S. federal government spending as a headwind, as this sector has historically accounted for approximately 8% of Accenture's revenue. Government procurement processes have slowed amid cost-saving initiatives.

For fiscal 2026, Accenture projects revenue growth of 2-5% in local currency terms, with the federal spending reduction expected to impact the outlook by approximately one percentage point.

Industry Implications
Accenture's approach reflects a broader "talent rotation" strategy emerging across the technology sector. Companies are reducing the workforce of workers whose skills don't align with AI-driven business models, while expanding in strategic areas.

Microsoft has followed a similar pattern, with CEO Satya Nadella noting in July that overall headcount remains "relatively unchanged" despite job cuts, thanks to new hiring in priority areas. Meta laid off 5% of its workforce earlier this year while conducting an AI hiring spree.

Not all companies have successfully managed this transition. Buy-now-pay-later firm Klarna has faced challenges in reassigning employees to a "talent pool" after determining that their original roles were no longer needed.

Looking Forward
Sweet emphasized that the company's primary strategy remains "upskilling" existing employees rather than replacing the entire workforce wholesale. The layoffs are expected to continue through November, with the company maintaining that overall headcount growth will resume across all markets, including the U.S. and Europe.

The restructuring program aims to maintain Accenture's historic target of expanding operating profit margins by at least 10 basis points annually, a goal some analysts had questioned given current market conditions.

As clients increasingly seek AI-led transformation strategies, Accenture is positioning itself to "reimagine processes, strengthen data foundations, and train people to work in new ways," according to Sweet.

The company expects to return at least $9.3 billion in cash to shareholders in fiscal 2026, maintaining its commitment to shareholder returns despite the significant workforce transition costs.