EY’s Global Revenue Growth Slows With $51 Billion in Fees (1)

Ernst & Young’s global revenue climbed 3.9% last year in local currency, the firm announced Thursday, representing a steep decline from double-digit growth the accounting and consulting giant booked the previous year.

Fees totaled $51.2 billion for EY’s fiscal year that ended in June, with steady growth across the Big Four firm’s tax and assurance practices. EY’s strategy and transaction business posted a modest increase while consulting was flat in the face of market headwinds, the firm said.

In comparison, EY boasted 14% revenue growth during its 2023 fiscal year, with $49.4 billion in fees adding up to one of the firm’s most successful years on record.

“EY teams have demonstrated extraordinary resilience in a challenging economic climate with growth across all Service Lines,” Janet Truncale, the firm’s global CEO, said in a statement. She attributed that endurance to investments in the firm’s varied service offerings, including technology like artificial intelligence.

Professional services firms like EY and its Big Four peers saw demand for lucrative advisory work dry up in 2023 as high interest rates and AI reshaped the consulting market. The firms collectively cut thousands of workers from their payrolls early in 2023. The reductions resumed last month when PwC said it would cut 1,800 US workers.

EY’s global workforce contracted by more than 2,400 employees in 2024, with practice support and strategy and transactions shouldering the steepest reductions. The firm’s assurance practice added staff however, EY reported along with its financial results.

Growth Plan

Truncale took over as the leader of EY’s global network in July. She launched a new strategy that prioritizes AI and leverages the firm’s combined expertise across tax, audit, and traditional consulting professionals to win market share and pad its revenues. The firm plans to invest in growing areas such as helping clients adopt new technologies and platforms, plus managed services.

EY has invested more than $1 billion into AI over the past year, building its own large language model and bringing those new capabilities to its audit teams. This year, the firm plans to build on that work integrating the emerging technology into all aspects of its business.

Truncale also committed to building a diverse, equitable, and inclusive workforce, even as corporate America navigates heightened attacks on such DEI efforts, with some businesses pulling away from certain programs.

“We are also creating new value for EY people, with an unwavering commitment to continuous learning and diversity, equity and inclusion to prepare our workforce for the future,” Truncale said in a statement.

Revenue Drivers

EY’s tax and assurance practices each posted 6.3% revenue growth in local currency. Strategy and transactions grew nearly 2.3% while consulting revenue held steady, matching 2023 results.

Alliances with other companies such as IBM, Cisco, and Nvidia helped to offset losses in certain areas of the firm’s business. Revenue from those partnerships contributed to nearly half of EY’s 2024 fee growth, the firm said.

EY’s ability to ink those agreements was among the drivers of the firm’s failed plan to spin off its consulting arm into a stand-alone company. US ethics laws make the firm’s sizable book of audit clients in the tech sector largely off limits for such partnerships.

Despite those restraints, EY expanded its partnership portfolio by a fifth, with 20 new alliances last year as it raced to build AI services.

Competitor Deloitte reported in September that fees for its financial advisory practice shrunk, leading to similarly sluggish overall growth. Despite the drag on revenue, Deloitte’s fees totaled $67.2 billion for its most recent fiscal year.

PwC, also known as PricewaterhouseCoopers, is expected to report its 2024 results later this month and KPMG typically releases its revenue tally in December.