IPG revenue slides

Chris Pash
By Chris Pash | 22 July 2023
 
Credit: Mark Konig via Unsplash

IPG reported a 1.7% drop in organic revenue to $US2.33 billion in the June quarter and pulled back its outlook for the rest of the year.

The global advertising group put the fall down to the underperforming technology sector, specialty assets and traditional consumer agencies.

Shares in IPG fell more than 13% to $US32.87 on the New York Stock Exchange. 

The latest result compares to a flat result in organic revenue in the March quarter, down just 0.2%.

The US market, where the bulk of IPG’s business sits, was down 2.5% in the June quarter.

International organic change was -0.1%. The UK was up 1.7% and Asia Pacific down 2.2%.

IPG share price at july 21 2023

IPG now expects full year organic growth of 1%-2%, down from the previous guidance of 2%-4% set in April.

The result is well below that of two major competitors to report their June quarter numbers. Omnicom reported organic revenue growing 3.4%, and Publicis Groupe 7.1%

CEO Philippe Krakowsky says the result is “inconsistent with our expectations” and the company's long-term track record of strong growth.

“During the second quarter, we saw the same puts-and-takes on revenue that we have identified and discussed since the beginning of the year,” he says.

“Notably, among our client sectors, tech continued to weigh significantly on growth. In addition, modestly heightened macro uncertainty impacted certain of our specialty assets and traditional consumer agencies.

“Concurrently, we continued to deliver strong growth in areas of the business that have been important drivers of our success over several years, namely our media offerings and the healthcare sector.

“We also saw solid growth in disciplines such as public relations and our experiential offerings during the quarter.

“Our new business performance to date this year has been exceptionally strong, featuring wins in many of the industry’s largest and most competitive reviews.

“These speak to the strength of our offerings, underpinned by our foundational data and technology infrastructure, and will provide strong tailwinds as we move into the back half of this year and even more so in 2024.”

The June quarter numbers:

ipg june q 2023 results

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