KPMG’s revenues have increased at a faster rate than its Big Four rivals’ for the second consecutive year as the consulting industry grapples with a downturn in demand and the threat of artificial intelligence.
The firm on Tuesday reported global revenue of $39.8 billion (€33.83 billion) for the 12 months to September, an increase of 5.4% from the previous year, or 5.1% stripping out the effect of foreign exchange fluctuations.
While KPMG’s sales growth stagnated compared with the previous year, it still outshone rivals Deloitte, EY and PwC, which have already reported global revenue growth of 4.8%, 4% and 2.7%, respectively. KPMG has a later financial year-end than its competitors.
KPMG was helped by a 7.5% increase in revenues from its tax business. Its assurance division, which includes audit, reported a 6% rise in revenues while consulting sales increased 2.9%.
While KPMG firm relies less heavily on consulting revenues, it still lags some way behind the other three in overall revenue terms. Deloitte posted revenue of $70.5 billion (€59.9 billion) for the year to May 31, while PwC and EY reported revenues of $57 billion (€48.45 billion) and $53.2 billion (€45.2 billion) respectively for the year to June 30.
The firms, which are structured as networks of locally owned partnerships, are not required to publish details of their global profits.
All the firms have been wrestling with sluggish demand in some parts of their businesses, particularly in consulting. After a boom during the Covid pandemic, when companies raced to upgrade their IT systems, growth has been slower in recent years as the macroeconomic environment made clients more cautious and work on mergers and acquisitions dried up.
To maintain partner profits, the firms have been trimming staff in the slower-growing parts of their businesses and in the back office, where they claim AI and automation are increasing the productivity of their remaining employees.
KPMG has been trying to merge many of the national partnerships that make up its global network, in a strategy designed to reduce costs, improve central oversight and spur growth by expanding services for multinational clients.
Global chair and chief executive Bill Thomas said: “Our results show that the multibillion-dollar investments we’ve made are driving sustainable growth across KPMG globally.”
“At a time of unprecedented change and volatility, KPMG’s combination of deep local presence and strong global connectivity means we are well positioned to support clients with highly complex, interconnected challenges – both now and into the future.”
