PwC underperforms Big Four in revenue growth
PwC fell short of its Big Four rivals in the most recent financial year, according to its latest revenue figures, as the professional services sector feels the impact of increased economic uncertainty.
The firm saw global revenues rise to a record $53.1bn globally in the 12 months to 30 June, as well as 11.8 per cent local currency growth excluding its exit from Russia and the April 2022 sale of its immigration advisory business.
PwC’s revenue growth is down from 13.4 per cent in the previous year as the Big Four has seen a broad decline in consulting and deal advisory work, leading to job cuts and pay freezes.
Competitors Deloitte and EY last month reported annual growth of 14.9 per cent and 14.2 per cent respectively.
PwC’s advisory revenues came in at $22.6bn, with the 13 per cent rise a sharp contrast to the 23.5 per cent boost seen in the previous year.
The firm attributed much of this growth to its strong relationships with technology partners as clients look to “digitally transform their business models”, with a 40 per cent rise in revenues from alliances.
Audit revenues rose by 8.9 per cent to $18.7bn, with PwC noting “complex market dynamics, such as auditor rotation, regulation and increasing competition”.
“We are in the middle of a period of investment driven by our strategy, the New Equation,” a PwC spokesperson told City A.M.
“We invested $3.7bn last year, and we are on course to add 100,000 net new jobs to our headcount by 2024. It’s not about top-line growth, it’s about sustainable growth and the payoff from the investments we are making.”
Bob Moritz, PwC’s global chair, told the Financial Times that a tougher economic environment would mean that pressure on profits would continue, with clients taking longer to sign deals and opting for shorter-term contracts.
Moritz is set to retire as global chair at the end of his second term next June.