October 31, 2020

EY Won’t Let a Mere 2.3% Increase In FY 2020 Global Revenue Ruin Its Thursday

The second contestant in the Big 4 global revenue pissing match came out with its FY 2020 financial results today, and EY continued to exert its dominance of third place.

The Black and Yellow announced global revenue of $37.2 billion for the fiscal year that ended June 30, a 2.3% increase in U.S. currency terms (or a 4.1% increase in Big 4-favored “local currency terms”) over last year’s revenue of $36.4 billion.

That’s the smallest year-over-year revenue increase in U.S. currency terms at EY since 2010, when the firm’s global revenue actually decreased by 0.84% following the financial crisis. However, the $37.2 billion in revenue EY racked up in 2020 is the most in the firm’s history.

While a record-setting year of revenue and growth in all service lines during the COVID-19 crisis might be enough of a reason for EY’s executive team to break out the victory Cohibas, keep in mind that the 2.3% increase in revenue is two times less than the 4.7% increase in FY 2019. Also, EY’s revenue growth in 2020 is smaller than its seven-year compound annual growth rate of 7.7%.

But Global CEO Carmen Di Sibio didn’t dwell on the negative stuff during his comments in the press release, and he just HAD to mention EY’s silly slogan because that will undoubtedly make EYers feel so much better about all the shit they had to endure this year:

“It is the determination and focus of EY people that enabled us to support EY clients around the world during this unprecedented time. In a matter of weeks, we had nearly 300,000 EY people working remotely and supporting EY clients’ business continuity and resilience needs. EY people also created a wide range of pandemic-related solutions for clients and provided pro-bono support to communities and governments. These efforts illustrate the strength of our culture, founded on our purpose to build a better working world.”

Is that 300,000 before or after the firm laid off all those people in the U.S., Canada, Mexico, and Israel?

Anyhoo, back to EY’s revenue. Here’s a chart EY provided with revenue by service line, with assurance pulling in the most but tax and advisory showing the biggest year-over-year increases. Note: percentage changes are in local currency:

But in U.S. currency terms, assurance revenue increased 1.4% over last year, tax went up 3.2%, advisory nearly 3.2%, and TAS 0.9%.

Revenue also increased across all three EY geographic areas (U.S. currency terms): the Americas 2.6%; Europe, Middle East, India and Africa (EMEIA) 0.43%; and Asia-Pacific 6.2%.

PwC was the first of the Big 4 to release its global revenue for FY 2020, coming in at $43 billion—an increase of 1.4% over 2019.

Deloitte will likely announce its 2020 global revenue sometime this month, while KPMG’s announcement usually comes in December.

[EY]

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