Interpublic Group Increases Outlook Despite Geopolitical and Public-Health Issues

Ad holding company reported organic net revenue growth of 11.5% in first quarter

IPG said it was increasing its outlook of organic growth in 2022 to approximately 6% from an earlier estimate of 5%.

Photo: Pavlo Gonchar/Zuma Press

Interpublic Group of Cos. became the latest major advertising company to raise its organic growth forecast for this year, citing positive business momentum despite geopolitical, macroeconomic and public-health uncertainties.

The advertising holding company, which owns agency groups such as McCann Worldgroup and IPG Mediabrands, said it generated $2.2 billion in net revenue in the first quarter, up 9.8% from the same period last year. It saw 11.5% growth in organic net revenue, a metric that removes the effects of currency fluctuations, acquisitions and disposals.

The company said it was increasing its outlook of organic growth in 2022 to approximately 6% from an earlier estimate of 5%.

Interpublic’s marketing and media services, which mix technology and data with creative work, are a “differentiator” for the company, Chief Executive Philippe Krakowsky said on an earnings call Thursday.

“The growth you are seeing is driven by these highly relevant capabilities, in the midst of an expanding set of marketer needs for more precise, personalized, and accountable engagements with their audiences at an individual level,” Mr. Krakowsky said.

Two of IPG’s advertising holding company competitors have also revised their 2022 estimates upward in recent weeks. On Wednesday, WPP PLC raised its forecast for 2022, citing strong demand from marketers in areas such as data and e-commerce in the face of turbulent global trends. Omnicom Group Inc. last week boosted its forecast, saying it was confident in its growth “despite uniquely challenging global events.”

Publicis Groupe SA in contrast said its first-quarter performance would ordinarily have led it to upgrade its expectations for the year, but that there was too much global and economic uncertainty to do so. It said it does expect to deliver organic growth at the high end of its target of 4% to 5% in 2022.

IPG said in March it would be suspending its operations in Russia. The company said it had 200 long-term employees active within its three global creative networks there, and that it would pay their salaries for six months.

“We’ve disengaged from our Russia operations,” Mr. Krakowsky said. “Amid this ongoing tragedy, all of us continue to hope for a de-escalation of the war and ultimately for peace, so as to bring an end to the immense and senseless human suffering we are witnessing.”

Write to Megan Graham at megan.graham@morphing-aircraft.com

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