The Interpublic Group of Companies (IPG) has released its Q1 2025 numbers with top line revenue slipping by 6.9 per cent year-on-year.
Revenue before billable expenses was down 8.5 per cent year-on-year. Compared to the first quarter of 2024, the effect of foreign currency translation was -1.2 per cent, the impact of net dispositions was -3.7 per cent, and the resulting organic decrease of net revenue was -3.6 per cent.
IPG chalked up that -3.6 per cent drop, in particular, to prior-year client account activity.
“Results in the first quarter were consistent with our expectations,” said Philippe Krakowsky, CEO of Interpublic.
“As we previously indicated, account activity over the prior twelve-month period will weigh on this year, though that impact was lessened in the quarter by sound underlying performance, with notable growth at IPG Mediabrands, Deutsch and Golin, as well as growth at Acxiom. Financial discipline remained strong, evidenced by our 9.3 per cent adjusted EBITA margin in our smallest seasonal quarter.”
Krakowsky added that it expects to see an organic decrease in revenue of one to two per cent and adjusted EBITA margin of 16.6 per cent.
Naturally, IPG’s acquisition by Omnicom will be weighing heavily on IPG’s performance. Krakowsky said that it had made “significant progress” on the “transformational restructuring” of its business.
“The long-term financial benefits of our transformation will exceed our original estimates and therefore accrue to the newly merged company once our transaction with Omnicom is complete, given that there is almost no overlap between our current standalone efforts and the synergies that have been identified and communicated in connection with the integration of the two companies,” he added.
Another big change for IPG is, of course, Trump’s tariffs. Krakowsky, ironically enough, spoke diplomatically about the changes.
“Since our previous quarterly call, macro developments have moved front-and-centre for all businesses. The implications of potential policy changes vary widely for companies across industries and geographies, and we are working closely with our clients in considering the decisions they may need to make when it comes to channel choices, investment levels and the best mix of marketing disciplines required to deliver business outcomes in more uncertain economic circumstances,” he said.
