Dive Brief:

• S4 Capital on Nov. 10 reported net revenue increased 42% in the third quarter, with revenue up 106% to $239.6 million, per its latest earnings report. The company secured Facebook and HP as what it calls "whopper" clients that generate $20 million revenue per year.
• In addition, S4 announced on Nov. 15 that its marketing and advertising services company Media.Monks will merge with content marketing agency Miyagi, according to a separate press release. Founded in 2013, Miyagi is based in Milan and counts Campari Group, Danone, Luxottica, Red Bull and Xiaomi as clients.
• S4 reports momentum continues to build into the fourth quarter thanks to its data-driven, digital-only approach and that it has not experienced a negative impact from supply chain issues or the Apple IDFA changes that have challenged some platforms.

Dive Insight:

Martin Sorrell's S4 Capital had another strong quarter and continues to build momentum through the addition of new clients, business and acquisitions.

"The pandemic has proven to be an accelerator of digital marketing transformation and we are taking full advantage of this opportunity by choosing to invest a proportion of our EBITDA margin in growth," Sorrell said in a press release.

The addition of Facebook and HP to its roster of "whopper" clients — which also includes Google, Mondelez and BMW — demonstrates that its digital-only proposition is attractive to major advertisers. S4 has identified 19 more potential whoppers, setting up the possibility of exceeding its goal of 20 overall, Sorrell said.

The merger of Italian agency Miyagi with Media.Monks boosts the company's offering in Europe's fourth-largest ad market with a company that specializes in end-to-end digital experience content strategy, design and production, per a press release.

The deal is the eleventh such merger or combination the company has announced this year across S4's content, data and digital and technology services practices, and it comes after September mergers with creative agency Cashmere and digital transformation services Zemoga.

S4's revenue growth arrives as the rebounding digital advertising market and demand for a range of digital services have boosted the earnings of the major ad holding groups with which S4 competes. In kind, the need for global scale has driven M&A by both ad-holding groups and competitors like S4 and Accenture Interactive.