Ernst & Young sees global revenue rise to $36.4B
Ernst & Young reported a record level of revenue across its international network of firms in fiscal year 2019, rising to $36.4 billion.
Overall revenues for the fiscal year ending June 30, 2019 grew 8.0 percent in local currency terms, compared to 7.4 percent in fiscal 2018. The assurance services line grew 4.4 percent, while advisory services grew 9.2 percent in local currency terms, tax services increased 8.6 percent, and Transaction Advisory Services grew 15.5 percent.
Revenue also increased across all four of EY’s geographic areas, with the Americas up 8.5 percent; Europe, Middle East, India and Africa (EMEIA) up 7.1 percent; Asia-Pacific up 9.1 percent; and Japan more than doubling its growth to 7.5 percent.
Across developed markets, the U.S. saw 9.1 percent growth in revenue in fiscal year 2019 to $15.3 billion in revenue, up from 7.3 percent in fiscal 2018. Growth was led by Transaction Advisory Services thanks to a strong U.S. capital and M&A market. The U.S. advisory business also experienced double-digit growth from performance improvement services. Strong demand for transaction tax and international tax services and a steady flow of new audit engagements also led to revenue growth.
“While the past year has seen a number of strains in the global economy — from trade tensions, protectionism and recession fears — we have achieved strong growth from our continued focus on long-term value creation using technology to transform traditional EY services and to launch new, innovative solutions,” said EY Global Chairman and CEO Carmine Di Sibio in a statement. “As a result, more EY clients are turning to us for both traditional and a newer range of services. EY clients see us as a strategic part of their wider ecosystem enabling their success in today’s marketplace. As I begin my first year as the new EY global chairman and CEO, we will be launching the next phase of our strategy to make even greater use of our biggest strengths: EY people, client-centric approach, use of technology and global footprint. I am looking forward to working with the immensely talented and diverse EY people to deliver this strategy.”
EY also saw strong growth in Germany, Japan, France and Canada, while emerging markets continued a strong growth trend, with 10.7 percent revenue growth (compared to 10 percent in FY18). Greater China experienced its fourth year of double-digit growth, up 13.2 percent (compared to 11.6 percent in FY18), led by strong growth across all EY service lines. India saw a ninth consecutive year of double-digit growth, up 19.1 percent (compared to 16.3 percent in FY18). Brazil and Mexico also delivered strong growth.
EY made 20 acquisitions and eight new alliances in 2019, expanding the firm’s talent in areas such as supply chain automation, robotics and cybersecurity. The Pangea3 and Riverview Law acquisitions added to EY’s focus on legal services in some markets.
EY has been focusing more on technology consulting, and reported that it saw a threefold increase in the number of blockchain activities, with nearly 80 percent of the EY revenue-generating technology on the cloud. The EY and Microsoft blockchain solution for content rights and royalties management, which launched during fiscal 2019, now processes 25,000 transactions daily. A multimillion-dollar investment in EY Blockchain Analyzer is being rolled out to more than 100 EY Assurance clients who hold or trade cryptocurrencies or operate in the blockchain environment. More than 120,000 EY professionals and more than 250,000 clients using the EY Canvas global audit platform are migrating to the cloud.
In FY19, EY’s headcount increased 8.6 percent to more than 284,000 people globally. In addition, 1,163 people were either promoted to partner or admitted to EY member firms. Partner promotions continue to reflect the firm’s priorities, with the assurance area making up 33 percent of the partner class promoted in fiscal 2019, emerging markets accounting for 33 percent of partner promotions, and women representing nearly 30 percent of partner promotions. The gender diversity on the EY Global Executive, the highest governance body in EY, also increased, with women now representing more than 31 percent of the members.