Why Accenture stock fell today

Accenturehis (ACN -4.82%) the headline news Tuesday wasn’t all that encouraging, and in reaction, investors traded the company’s stock down more than 4% on the day. The consulting firm is delaying its annual round of promotions, a move that could affect hundreds, if not thousands, of employees.

Six months exchange

This news originally came from Bloomberg, which wrote in an article published before the market opened that Accenture aims to delay most planned promotions by six months. Citing unidentified “people familiar with the matter,” the article said progress would be announced next June, rather than December, its traditional month for announcing such moves.

An unnamed representative confirmed the change, saying the time change is permanent. This person added that June provides “better visibility into our customer planning and demand.”

According to Bloomberg’s sources, Accenture’s CEOs were initially informed of the change in early September. Today, the expanded company has approximately 750,000 employees and is active in 120 countries.

A sector is struggling

The consulting business is struggling at the moment, the main cause being a pullback in spending by many businesses. Although economic fears have receded somewhat, they are still an influence, with top managers worried that inflation could persist or that various conflicts overseas could dampen the global economy. When companies are afraid, they tend to cut back on spending. And often, the expenses they control are of the “non-essential” type, such as consulting services.

It’s no surprise, then, that Accenture lowered its revenue guidance earlier this year for annual revenue. It now expects a maximum 3% increase in revenue this fiscal year compared to its predecessor. This was down significantly from the previous forecast of 5%.