Japan Technology: IT Services: Accenture results read-across: Consensus beat; structural expansion in AI investment; AI benefits emerging

Goldman Sachs analyzes the Japanese IT services sector through a read-across of Accenture's 4Q (June-August) and full-year FY8/26 results announced on October 1. 4Q sales beat the Bloomberg consensus and growth accelerated, while order growth turned positive. By region, sales growth accelerated in the Americas and Europe, while Japan and Australia continued to drive growth in Asia. According to the company, negative effects from the Middle East situation are ongoing, but demand for AI-driven business transformation, including for core systems, data, and infrastructure, is expanding structurally and is expected to continue. Benefits from AI are now emerging that outweigh the impact of AI disruption. In terms of read-across for the Japanese IT services sector, these results are somewhat positive for earnings at NTT (Buy), given its subsidiary NTT Data's high overseas sales exposure. Meanwhile, AI-related business is also starting to expand in Japan, and NEC, Fujitsu, Nomura Research Inst