Interpublic has posted an impressively consistent set of earnings over the past few years but it’s well and truly run into the buffers now as tech clients (it handles Microsoft for example) have slashed ad expenditure, hitting, in particular, digital creative agencies R/GA and Huge. Its media agencies have done well in new business terms but budgets are clearly smaller.
In the second quarter of 2023 total revenue dropped 2.5% to $2.67 billion with organic revenue slipping 1.7%. This, CEO Philippe Krakowsky admitted was “inconsistent with our expectations and long-term track record of strong growth.” IPG cut its growth forecast for the year to just one to two per cent.
IPG shares, already under pressure after weak results from US-based rival Omnicom, tumbled 13% on Friday. Publicis Groupe comfortably heads the pack with first half growth of around 7%. All eyes will now be on WPP, the last of the big Western-based ad holdings companies to report half-year figures.