Business
Capgemini trims 2024 revenue target again as soft markets hit Q3 sales
Global Banking & Finance Review®
Company
(Reuters) -French IT consulting group Capgemini cut its 2024 revenue target for the second time this year on Wednesday, after continued weakness in some of its markets, especially manufacturing, hit its third-quarter sales.
The group, which offers services ranging from cloud and AI to enterprise management across a wide array of industries, had in July forecast a surprise fall in its annual revenue due to a downturn in the automotive and aerospace sectors.
It now expects its revenue to decline by between 2% and 2.4% at a constant currency basis, versus its previous forecast for a drop of 0.5% to 1.5%.
Capgemini’s revenue fell 1.6% at constant exchange rates to 5.38 billion euros ($5.82 billion) in the third quarter.
“In a market that remains soft overall, we expect to deliver a similar growth in Q4,” CEO Aiman Ezzat said in the earnings statement, though he added the company expected headwinds tech and telecom sectors to ease gradually.
Client demand continues to be driven by operational efficiencies and cost reduction and we seize their growing appetite for AI and Gen AI services,” Ezzat said.
($1 = 0.9244 euros)
(Reporting by Leo Marchandon in Gdansk; editing by Milla Nissi)
A revenue target is a financial goal set by a company, indicating the expected income from sales over a specific period. It helps in measuring performance and guiding business strategies.
Operational efficiency refers to the ability of an organization to deliver products or services in the most cost-effective manner without compromising quality. It often involves optimizing processes and resource use.
A downturn in business refers to a period when a company's performance declines, often characterized by reduced sales, lower profits, or negative growth. It can be caused by various factors, including economic conditions.
Headwinds in business are challenges or obstacles that hinder growth or performance. These can include economic downturns, increased competition, or regulatory changes that negatively impact operations.
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