IT Consulting

November 2017

Sectorwatch

The IT Consulting industry is estimated to be in excess of $400b in the US alone, employing over 460k individuals; however, it is relatively mature, growing at an estimated 2.1% CAGR from 2012-2017F.  With the economy and the number of US businesses continuing to expand, record corporate profits, and a drive for efficiencies should increase demand for IT consulting.  Further, increased M&A activity and subsequent business integration should augment the demand for IT consultants. 

Industry Trends:

  • Current revenue growth rate is less than the average of the last 3 years, indicating that the market may be flattening or declining
  • Current gross profit margin exceeds the average of the last 3 years gross profit margin, indicating supplier pricing power
  • Current EBITDA margin exceeds the average of the last 3 years EBITDA margin, a condition that may attract new entrants