Publicis Groupe has kept up an industry leading revenue growth rate while some others in advertising have struggled.
The company reported organic growth of 5.3% in the March quarter, helped by new business wins and a rebound in the tech sector.
CEO Arthur Sadoun is confident "despite ongoing macroeconomic uncertainties" delivering full year organic growth of 4% to 5% and an 18% operating margin rate.
The strong start to the year, ahead of expectations, was also helped by new business tailwinds from 2023 and by “the impact of a clear rebound in the tech sector”.
A contraction in spend by the big digital players had hit revenue growth across the global advertising players.
“Since 2019, we grew by 24%, roughly twice as fast as the industry average,” Sadoun told analysts in a briefing.
“We expect to sustain this very solid growth across the year.
“Despite ongoing macroeconomic headwinds, we are more confident than ever.”
Sadoun backs his confidence.
“Demand for personalisation at scale, in a soon to be cookieless world, continues to increase, particularly with the rise of AI, we are able to capture a disproportionate part of our client investment in this area, thanks to our unique data offer,” said Sadoun.
He anticipates data and technology arm Epsilon and Publicis Media, representing 50% of revenue, to remain very strong.
Epsilon was up 6.8% organically in the March quarter after double digit growth in the same quarter in 2023, capturing a continued need for identity-based media solutions.
“We will benefit this year again, from new business … connecting data, media, creative and technology, all powered by AI, has enabled us to reach the new business ranking for the past five years,” he said.
“We expect the winds we had in the last 18 months to continue ramping up this year.
“Our giant platform organisation means that the goals we will achieve this year won't be at the expense of our margin.
“Thanks to the efficiencies generated by our country model, global delivery centre, sales services, and our platform assets, we are able to invest in our talent and our technology.”
Creative, under pressure world-wide from tight brand budgets, was resilient at Publicis with “low single digit” growth in the March quarter, driven by new business scope expansion, and a “solid” performance from production.
A slide from Sadoun's presentation to market analysts, showing his confidence at growth prospects:
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