Dive Brief:
- Interpublic Group recorded $2.68 billion in total revenue, including billable expenses, for the third quarter of 2023, compared with $2.64 billion over Q3 2022, according to an announcement. Net revenue, revenue before billable expenses, was $2.31 billion, an increase of 0.6% over the third quarter of 2022.
- For the first nine months of 2023, IPG’s total revenue was $7.87 billion (compared with $7.94 billion for the same period in 2022) and net revenue was $6.81 billion, a year-over-year decrease of 1.2%.
- The holding company attributed the lower-than-anticipated earnings to ongoing decreases in client activity in the tech and telecom sectors and macroeconomic concerns among marketers, which has led to the delay of projects and sales cycles.
Dive Insight:
IPG admitted that revenue performance did not meet expectations in the third quarter, but maintained that disciplined management and contributions to growth from media offerings, the health care sector, sports and experiential marketing and public relations helped keep the holding company afloat and committed to closing the year as strongly as possibly, said IPG CEO Philippe Krakowsky, in a release.
“We continue to be in-market with compelling offerings that help marketers grow and deliver business outcomes,” Krakowsky said. “This has translated to strong new business success for us year-to-date, and which will provide some tailwinds as we move into 2024. An additional area of value creation is our long-standing commitment to capital returns, which remains an important priority for us going forward.”
Despite the lower-than-anticipated earnings, IPG sees positivity in its future, holding firm on its previously stated full-year margin goal of 16.7% and organic growth in the fourth quarter of 1%. In addition to new business growth and an improving economic outlook, the company’s total operating expenses, excluding billable expenses, decreased 1.1% for the third quarter and 0.4% over the first nine months of 2023.
The holding company is showing signs of an improved Q4. IPG’s UM media agency has reportedly been named global media agency of record for General Mills, handling strategy, planning, buying, analytics, performance and commerce across 36 markets.
The company also recently launched Real ID in the Cloud, an identity resolution application that enables brands to integrated scattered data points to create holistic customer views using data assets from Acxiom. The identity solution comes as marketers pay increased attention to the space as the deprecation of third-party cookies looms.
