IPG - Earnings call transcript Q2 2024 | The Interpublic Group of Companies, Inc.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good morning, and welcome to the Interpublic Group Second Quarter 2024 Conference Call. [Operator Instructions] until the question-and-answer portion. [Operator Instructions]. This conference is being recorded.

If you have any actions you may disconnect at this time. to like now would introduce Mr. I Senior Leshne, Vice President Relations. Investor of Jerry you Sir, begin.

Jerome Leshne

you This Ellen joining joined morning. for Good Thank us. CEO, Krakowsky CFO. by Philippe morning, and our by Johnson, our are we

have website, our our presentation interpublic.com. release our and We slide posted on earnings

to time. begin plan prepared Q&A. with open market will to be before We by at followed remarks We conclude X:XX Eastern

are are the refer detailed call, forward-looking other statements These that These we cautionary company. SEC. and uncertainties will presentation. to with in filings release subject this in earnings the During our to slide and our and included statement about the our the XX-Q further are

also the At this measures turn Philippe GAAP financial substitute believe will for things performance. We supplemental review non-GAAP and allow to operational not to that provide transparency greater pleasure of a measures. measures, these my to over our in We data refer point, certain useful that, is it Krakowsky. while

Philippe Krakowsky

Thank you, Jerry.

our the LatAm and organic in by in from in Continental expansion strong growth call operating high-level moderate growth I'll followed in billable conclude agencies quarter. recent before of growth then From U.K., performance, expenses growth. Q&A. This and over at That we of and our quarter. saw other on X quarter are performance care, from a half our financial of our begin specialty our your the the markets saw and bringing U.S. drag organically client provide the were IPG quarter, begin IPG will keeping solid we second the followed I'll came agencies organic flat, again time, the segments with Health performance well digital second Also organic quarter, we quarter a to the [indiscernible], second margin same and some at was our by with ago. as at was reporting we additional Ellen X% revenue, period approximately and and To a telecom morning, standpoint Golin quarters, and our to in food Deutsch our we usual, growth And the weighed led driven view results with ago. by growth by the Europe in overall. as a the group and consumer in sector increases with LA, our transportation. that, by paced by As insights Retail business solid and in about at highlighted X.X%, be Mediabrands. We of growth highlights beverage acceleration growth X.X%. In year and underneath grew goods. and decreases consistent as underperformance of services, tech health was auto well were year Each saw consolidated on first with

year. As we've on AOR of to X% continued telecom that approximately decrease of due loss called out previously, telco organically assignment weigh sector client a late the a growth the Most in tech last the with large was quarter. to and by

and I by telco X.X%. specialist clarity, double negative revenue QX would of note sake excluding the tech growth and the organic our For sector that counting, on weighed combined digital

and margin. expenses to Turning

evolution of continue in teams balance with to investment discipline effectively Our ongoing business. cost the our

offset was leverage business and a Second the points other XXX earnings a on from and an compared adjusted intangibles related operating quarter dispositions. drive acquired and leverage a technology, to ago. We which That and salaries and investments basis as payroll, from basis XX.X%, $X.XX per planned transformation year adjusted increased and $X.XX ago. in senior resources, partially in was EBITDA points expense. Diluted helped as margin particularly expenses net XX year share talent amortization of resulted in of for reported which business improvement for centralized quarter by platform SG&A small office was on base strong had impact

repurchased related the their March global to as During $XX consumer a we late and year shareholders. On that noted growth to major high in X% X.X returning X% ongoing by health the of a decision quarter, we care million due million call shares, we that be had achievable. end work, advertising targeted to to with our you, entered the we range, not client last the would

in we As sentiment. are uncertainty has macro the seeing and progressed, modest year the incremental domestic in environment consumer

therefore, expect continue EBITDA year. we the to we XXXX full to growth margin is, for achieve adjusted of that approximately XX.X%. X% target level with view growth, Our And of organic that

care of we most strongest offerings, X capabilities ahead, marketing our such health to experiential strong continue and media their as thread our specialist of positioned largest the and businesses marketing anticipate are our and common in expertise, Looking performance. The areas that IPG consistent services data that that the PR business Mediabrands greater tech-driven with successful on growth that are to rely skill directly assess can technical, audiences These and IPG reach we Health, specialized to the high-value which provide optimize. with they and lead outcomes our more to are businesses, and do also marketers. most precision sets growth has

or our of in to increasingly secure capabilities. models which with generation, to rely and as language Generative by heard that are including and in broader well and our tools and insight the data machine which engineering AI, earn seeing has practices, AI recently, Collaborations communications past, more learning Microsoft Amazon, creative by precision analytics built a large be given developments transformation will Acxiom and in-house the new AI and and us include talent predictive these Google, we're in capabilities. The from audience as of informing our production of experiential equally and business, creating access AI us Adobe, on enhancing offerings. media have area technology algorithms work, advanced from and decisioning, solutions you ideation set Getty our every of further it work Blackbird Images, fundamental been enterprise all much marketing As segmentation powered others of

leadership strategic technologies it our upskilling months, ongoing every have emerging as see imperative and XX responsibility central these across AI more has of past creation. new the reigniting to offers company. Generative with We capabilities with The clients. of of work significant. creative expansively time, offerings for process. our been made and the the a operating our this promise our foundational of has team engines this value many produces been to people this us progress Over Over the of as canvases

all disciplines. We campaigns, It messaging creative identity audiences marketing and across connects we last enterprise all data a technology IPG platform, marketing earned facets media Studio heard is recently first standards, concepts AI to products. and move layer, the on modeling channels. what by chain all As strategies targeting, or as and through to including the seamlessly the marketing platforms sits product you integrating of engine fueled and way which at and in consumer media turn media level predictive in activation from company Adobe's across technology and which call of engine. That dissemination Acxiom unite the unified by high-value our we then at of investments the all supply paid we whether content mean our into built became scale, and on a and production quarter, technology of insights data set practices by the formats Gen

for increasingly role, in world are a AI insights channels. In an to key activity investments doing is the be scale and our this high-quality been in top-performing solution, to and strategies, do all then the the for true we've at sales to marketing creative clients level have engine and our and will at of with impact end-to-end which without us essential activity play and and of individual engage in industry's assets of entire media, continues marketing with success. allows an the data for which Acxiom clients our data-driven of or forms that which cookies an purposes analyzes This better delivering personalization to proxies. value media, communication Our audience convert attribution is access performance through other customers which understanding at to the data scale. This their across audience one engage, helps customers will assessing need proprietary to retain funnel, important optimization.

significantly Our than performance in available any global billion other marketing spine, X.X we with which set attributes data Acxiom industry engine data ID using optimized those tech real people can from that greater meaningfully stack help and this power and of are and are our Acxiom IDs core my and competitors. The the wins device new of across global now to engine the company closest engagement many business remarks. more to later match every in cover significant I'll

quarterly things Ellen though, a results. over view Now let's our of turn more detailed for to

Ellen Johnson

you, Philippe. Thank

of revenue track net the from on highlights As X organic X.X%. to second Beginning revenue webcast. ago, my of our expenses a presentation, that flat will before with year the remarks a with an our increase billable the accompany slides reminder, Slide or was quarter presentation

our revenue Our in organic X.X% the international X.X% and net was was markets. U.S. increase in

X first the of months organic revenue year, consolidated increase Over X.X%. our the was

was increase ago. an $XXX.X of a Second year from compared quarter million, year adjusted X.X% was and margin XX.X% ago, our with XX.X% EBITDA a

included share impact nonoperating income amortization businesses. It of a million quarter during Our that year's related of sales after-tax quarter of shares year. intangibles EPS settlement normal X.X audits. nonstrategic X.X federal gain of benefit exclude important per to acquired the is the half million as per note We the shares last the reported in $X.XX repurchased our $X.XX the to of The the diluted $X.XX the second adjustments the earnings and adjusted. as certain and was of and share from tax small in first course,

follow. our quarter. I'll in detail that slides and X, operating to in for P&L see you'll the Turning expenses the revenue Slide cover

to Turning detail X. Slide revenue more second quarter in on

$X.XX the in negative exchange XX Compared points. change was was billion. revenue the of net 'XX, to in rates the Our basis quarter QX impact

net divestitures were X.X%. Our

revenue Our X.X%. organic net was

X.X%. organic months, the For increase X our was

second other the the Consumer of industrials strong diversified in in public terms goods was flat. Retail of also and grew and quarter. quarter, sectors category and health the food was client our growth very care performance and in sector In by approximately our beverage in led sector.

Lower we way, spend a other at of the and transportation at saw segments. was and is end sector at telecom the last the in to services, a in and auto tech due of the revenue existing slide lower auto Mediabrands our the loss clients. The from year sectors. look Going decreases and bottom client financial

by ] increased Data agencies organically decreases digital at offset by We Our Solutions basis saw media MRAM. as performance in revenue again was at our specialist Engagement & and decreased growth segment Philippe Those our points. by XX strong largely businesses. [ out noted, Media

led and by quarter, increased [indiscernible]. at our strong Health client Relations, performance while growth IPG X%. led by Our strong organic We to at Experiential our organically creativity-led X.X%, the At very group due Communications a experiential segment LA. in and by at was Deutsch integrated and Solutions were segment largely major advertising Solutions decreased by cost growth Golin in Public cutting Specialized

grew revenue was growth XX% and at the net region. grew Organic Moving strong quarter on and by Health. were IPG X. to organically. by revenue The IPG in Slide X.X% Mediabrands of We net U.S. led

offerings growth [ [indiscernible] quarter, by that as a X.X% notable Acxiom. Media from net client our telecom partially in business headwinds and existing in led included new MRM digital contributions performance X.X% CUK loss ] revenue LA, at also strong led at organically. and Relations. Deutsch [indiscernible] to ] growth as of the saw the We our Europe grew markets well Public and grew increases last a clients. in quarter by offset agencies specialists, growth [ the with X.X% That creative and by wins and with organically. McCann decreased at by were Golden XX% We grew revenue PR organically our of at was as year. International in late

We our of largest markets. have each in growth national

led Mediabrands. X.X% that Pac but and India, Strong Mediabrands organically. second growth in are most largest the by the we was by Asia markets. Other company in IPG holding organic was decreases in paced X.X%, LATAM more in other offset national than FCB growth was where decreased region by

worth the Africa, continue see group, East. In by Israel in notably is our well strong other grew growth to the Mexico. which Middle grew as noting in It growth Middle East quarter. is in Canada, markets the that we We and led X.X%,

and operating X the Slide expenses Moving in on to quarter.

exclude adjustments from XX points year. EBITDA decreased a billable reported with intangibles, amortization net which our a XX.X% of restructuring was that ago. from last year expenses, acquired compared result revenue expanded and The operating to adjusted expenses, was net margin XX.X% Our of the year basis flat ago

a a and and see salaries can slide, a XX.X% ratio Underneath XX.X% related of that on was our you for XX.X% benefits was As lowered of we as percentage revenue XX.X% with ago. expense total expense tax the revenue net to of which year ago. our net base compared compared year payroll, result,

percentage revenue a somewhat was which year as levels incentive is net elevated net of net X.X%. increased compensation of typical with from performance-based Our expense X.X% from of ago. Severance revenue slightly and compares to revenue. X.X% a X.X%

Also performed net address Our in quarter with labor 'XX. of these actions expense [indiscernible]. Temporary in direct this the the on is [indiscernible] revenue our was investment with was compared net technology revenue in second XX.X% that X.X% compared and slide, Each of business transformation. Slide expense in XX. on appendix planned business areas ratios other is the QX and of X% of office comparison presented XX.X%.

continue leverage last basis for our We year. XX expense to from which decreased occupancy, points

on of adjustments begins net transparency and revenue points senior and from levels picture [indiscernible] with Slide a EBITDA our strategic the through investments The side platform. On compared Our present the of left-hand right, leadership basis SG&A adjusted expense increase adjusted left in centralized to year X.X% of reflects we XX This was of to of to X, and reported diluted results detail the better enterprise implementation performance. ago. in the a our quarter comparable reported provide to results EPS. on order and second higher

for million. $XX.X was acquired the the amortization expense intangibles Our second column in of

in $XXX.X cash $XXX.X cash million previous their we $X.XX quarter. with adjustments to diluted $XX.X $X.XX. Slide was Adjusted flow working the period. On quarter million small other the Operating diluted adjustments million 'XX. earnings was of between months. nonstrategic from at businesses. second before the At $X.XX was the sales adjusted as restructuring for of capital of turn the and EPS X compared with Cash earnings and per operations flow share foot the related year reported with Slide per compared X the [indiscernible] ] The to ago. in for share to quarter in $XXX slide, X, million a the to of bridge [ are

used by due primarily $XX.X our net of CapEx. reminder, changes quarter highly to million in flow and working investing we can a a seasonal volatile capital. In $XX.X As our million, in cash is operating be activities, consisting

notes activities as financing senior share reflects maturity Our as we million used in our of million. dividend quarterly $XXX.X repurchases. April, regular the and cash in which This well our $XXX paid

in the sheet. and Slide current the our of Our the balance $XXX.X is outstanding was of cash quarter for net maturities $X.XX million. On of ended equivalents. Slide cash XX portion debt. quarter the We depicts billion decrease with our XX

was at see billion. can $X.X schedule, you total this As on debt quarter end

on strong I the both really I'll strength Our And next of maturity Philippe. and for financial financially as sheet and efforts turn Slide balance like discipline gratitude our is liquidity not commercial. as with back continues until to that people. XXXX. In of XX, to express summary, mean our we my would positioned remain it that, well the well

Philippe Krakowsky

Ellen. you, Thank

underperforming that parts continued I and and to evolve, As mentioned portfolio. business at to our to we're earlier, the enhance structure working pace of our are organizational growing of address the also areas

all of continue to of part and precision we're a to make service move our going forward, holistic more Going greater solutions performance and to offerings.

will production. at increasingly level. to corporate senior ensures leaders as that more commerce, and the the be guided marketers capabilities to the major such of range our we with assets. broaden platform with best-in-class we're IPG functional portfolio and of interactions can by client common across data, horizontal business connecting Our This also help media issues clients priorities strategic The our address that activation denominator is

more mentioned more prominent one a in businesses. to strategic which from you previously. sectors their continue media needs example growth and to marketing partner Our as to order become retail goal value of client they to of seek is to is we've the technology this derive is An power supporting connecting

Beauty investment Acxiom to in area played retail to digital their and for business standards optimization brands, unit with part data-driven results. the the networks network marketers market in intelligence serviced UB Retail buys connections see within evaluate as and clients and the our handle media approach Acxiom because we defense and in it their retail space, client which our fostering As for criteria, Beauty retail selected assignment and been Ulta grounded by are best is MediaHub, consumers look Ulta of unified specifically our brand's and unit, Media Beauty their call delivering quarter. Media, the objectives. This which significant differentiated measurement, business Kinesso data media a creative programmatic, had networks a Media this media assets which dynamic housed building which and a ensuring for during growth. IPG's formerly business bespoke allows a performing to increase as and and addressable as is includes media consumer Ulta's audience, engagement competitor. The across teams within noted, marketers solution combination this of social determine more to in build expansion promising in Ulta needs increase successful retailers brands from a solution, well as in as media

announced PR also on and take an a quarter win offering UM UM had platform a iconic of FCB UM, in by momentum shopper global Media search named significant earlier as Levi's Another which consolidated [ Alliance AOR a client. Notable Americas. to agency and on as production and Levi's markets in at of wins combining Martin is in brands. see [ growth the in Group [ Generative media for result its ] appoint its McCann certain our priority AI ] us And the earned of the core number responsibility Enova's played supported account its for this agency offering week its media is driving media U.K. on Weber as proposal as China engine This also between Motors, mentioned, production McCann X-year influencer the [indiscernible] creative full-service builds saw will which appointed and its brand production, integrated MullenLowe ] globally, the and General the was IPG our with record for UM Agency perplexity, agency. key World and record. After assignments. of important brands capability by our roles and international relationship Buick of Pharma. content studios, health a component social and

selected of our its LA, for continued expand ] social X-Hour maker, include its Mazda Another Deutsch Adobe on brands. [indiscernible] FCB its media and both and record Lynch media champagne Photoshop X clients, with tech and [ lead for as Carmichael and work Firefly, ] Corbel to laundry [ was influencer work as social multinational its partner core strategy Energy detergents. [ creative, to GenAI other by agency PR and American for earlier, Golin app acrobat, mentioned global relations, Canada media AOR Top CRM. ] its we Unilever, creative strategy, relationship chose brand as and named to of named

in order be course, and and audience-led is into Creativity placed are of that work well their so required remains continues a many comes must world competitions to the even indicate we're platform what where in Of that a to clients performance creative our a creativity technology craft solutions for ideas heart accountable when and makes to the make and Integrating business. differentiator, a and brands our of marketers. capabilities need ambitious talent build of essential. to it can difference at

Company the And of of as honors, for winning which Festival show, peers, Year. Interpublic our also Creativity, festival's at of York ] the [ of our This as And industry's award Awards peers we global New Ken which creativity. where as largest and of as our is Grand is the the other Festivals Prix Creative judged Interpublic XX Grand almost brand the twice is the include Year more categories and week, competitor. Notable Prix highest Holding our hallmark any [ by last then at quality named many one data-enhanced the ] best that our we the industry's outperformed Just a Line won craft gaming, live important digital experience, than nearest recognizes an the company also and Holding a competition were it work. honored its show. Advertising Company makes

Healthcare at the In the health terms Year Healthcare the the year, sixth consecutive Prix Network named multiple Public arena Area the in of unique the a named a of won Relations in both North Grand XXX Health Prix. Regional the both for and IPG Grand pharma the Agency for was festival, third at of categories. Year FCB client in row, Golin fourth on Network was America year Weber of Also we in an row. to and year sectors, Year Shandwick, for the

kind Our for tech with engineering of for one production. unifying by IPG's tech cloud Within the that announced success experience, key brands our workflow, we innovative technology during martech marketing forward data we're on for unifying team. This move that drive reason this going resources well powering our stack, the the build can fully success. our commerce quarter, we further and and marketing and resolution rests capabilities. And ability platform, and excellence we're marketing data, combine responsible And performance leadership services this the Acxiom's ad to with engine. clients under customer creative that's data and teams deep identity as data engineering media, as and centralized behind one in thinking integrated real long-term time aligns on marketing

And success XX on of offerings past by costs. you efficiency while this months, As number has are marketers, marketing IPG media seen place during clients data, a premium a we consistently Brands. to ranked our our been long-term and to tech Media have tech-enabled combination XX expertise at and as key best-in-class greater know, the of

for pivoted creation component buying. but clients we well able strongest new and practice with fully principal an media have media effective for growth evolution, business. what as as This our also not time consistently are will performing and marketplace prospective that our for and avenue through has scale the take option been new value of practice but media deliver advanced for growing now to solutions, our Given only represents media current value incremental to in

that's specialty become mix due X of adjustments an than dock. remarks, each a concentration R/GA Huge, certain practice asset in my is the their operations see the IPG in features at our some traditional our conversations we performance across regular part Innovation continue peers. An the mentioned areas workforce of that performance to the and feature and co-loaded outset headquarters the As these those area agencies, portfolio of digital of of of to made within having more at to disparate

evaluating We and those these for their formally right focused brands. that value process service in you on alternatives on unlock for innovative remain and solutions And for. progress keep are could premium agency strategic now they're help clients The as people. We'll clients their appropriate. teams partner posted known greater this for delivering the top-tier

we're that media principal the particularly coupled head will to buying weigh facing to our of results, spent sector pitches. losses the the competitive in landscape As to industry's know, win consistently challenges of led we continue agencies, and top when XXXX. you line of a with at outperforming number the most on That our the shift many have recent years it certain comes said, we as to growth into

more the business in solid in the large full to have We we in retail, commerce. pipeline media effect reviews. deliver existing an and have retail year of will to areas of our to our forward. In consider company transformation, the base the where organic we and reignite best business as These remainder as a [indiscernible] commerce, outcome growth a new accelerating for focus and this avenue certain ongoing going year this rapid and new transformation competitive scale We'll growth position benefit several such and high-growth continue capabilities a M&A level overall media as would growth profile, areas our of development portfolio. our of as higher also and look such client opportunities,

at organic to of for growth target continue expect margin the level, EBITDA year, we X% adjusted earlier, and mentioned XX.X%. As to full achieve approximately of that

value returns. as areas and to include long-standing for balance and our as liquidity strong ongoing our creation Additional and capital commitment sheet well

As our this as and floor open call. our as with to questions. well people you those we And thank the on always, partners that, your let's of

Operator

America. with from question Bank Hilaire de Saint Our Instructions] [Operator of first Adrien is

Adrien de Saint Hilaire

be impact have you organic talked I'm of for all, the impacting outperforming factors has about I also Europe the in that to those I'd but my And many first market. think From across growth been counterintuitive, U.S. the that given ad do XXXX Europe your well? would seems second in be opinion? why [ and bit Philippe, is X at curious peers, that the versus curious true sales as to the ] question then the as seat, factors you second growth how seems half. different at IPG, also a GDP U.S.? is

Philippe Krakowsky

Sure.

question a obviously first The only I up can to point. unpack

So what is number a recent are think with would mentioned partners for to decisions. and obviously call that we've who us. out the important headline you I sizable very I Those of clients remain

of of the is because this So think point, pretty the are I on sitting the We ago. you're perspective, a other sitting a a neutral. wins, at impact focus we business and had possible right here solutions would net and -- I year those wins unlike that now, point we're right is the new essentially about clearly of string to clearly say, losses thing "losses", going from where best relationships. And sizable be to other out delivering service there's the opportunity regrow of some

we a it's to business year new we've half have out, far 'XX the headwind so for don't And is kind and 'XX. about that question to a go. budget a got for And project of yet, given early that

in is going what's large segment new focus be is the would be would tech maybe the recovery digital assessment capabilities strategic our business some And think wind the sales. options for change math also with that XX% that when growing, in of existing down it loss, the of a that away, I telco then goes to clients. Obviously, bit. new so the And in about clearly specialists we pipeline talked

going quantify step of Ellen you. the a in question, not big are. I sort ask for the us. very gets to specific I a because sense give And I that really with heard then just think region. of Europe moving So I'm just you parts it on can what can't very to It's very, before, you've us

an impact. have specific it becomes a So can client that really in market

Ellen Johnson

across our Health. Europe Yes, we revenue, some growth particularly wins We But really, at of France, is grew. did growth particular. McCann. And decent it in nice Spain, of had portfolio Sure. Germany, had through IPG our the major also see and we about agencies, markets, all X% breadth was that a creative

client both So clients and across sectors.

has it region for strong So a us. been relatively

Operator

question with David is from The next JPMorgan. Karnovsky

David Karnovsky

spoke and uncertainty in incremental You softening to sentiment. consumer earlier some

the could then the And wanted XX on confidence factor their at that this level months. investment. hearing you you're Just expand business? better over you bit, in offering in what mentioned your media clients our a compete position now in from views if as also as scaling you a to point up past of being terms Media brands to new see a do on of for see Principal there, and you're capability

Philippe Krakowsky

I right? of would all take look, much talking And them that the the from domestically stuck a seeing It stands so And I seeing tone guess to that you business, -- geopolitically, in the I'm the I I would uncertainty But significantly. Well, say of aperture kind broaden I on has order. mean are and world to I'll environment levels operating is that heard same you become given the fairly across that challenging. And policy we're as the fiscal of sense thing. socially. neutral. of that then our competitors, know I in think the couple reason more we

a time that is business right was on be universal it to the see that or It's get I granularity hey, a caution. needed delayed the most with there into we in about Now to taking either recession is a more the factoring areas bit the called extent a you, of don't thinking, some sort spend to of more begun there we conversations in last this all marketers. was bit And that we're it's board. But to it. feeling there a if or that's around we'll out. the that it's way a client not felt the clients, kinds of across that the something you're with to be you give it a that think certain had our the bit or decisions be from wanted where year texture And reviews, detailed on decisions call back are with of indefinite, bit I ago to since longer made pervasive, of talking we to it's like little corner. But

had look, this running. of it see question, with that principal early. when to need It in discussions It completed with buying time is we've up you that incremental and the work with ramp to tracks and our media Your will is now up. all think other we it's dimension consistent foundational settings each we've unlike and I you offering really one,

always measured media and that part because of client-first clients steadily time, organization. increases to will over as mix a partners We that's buying going are way approaching our in we're and a be

to So the in, it's which want in of market clients this opt essentially lines which a access want question to mode.

that. Our has successful for media a without long really business time been really,

going But to are the portfolio there in of essence, of multiple of who buying in plenty kind platform we're operating and tools, the powered approach they So our because folks effectiveness, are be models. the it. data want to franchise part with the the decisioning

principal efficiency lot loss automotive last the more uncertainty. and brands this year situations definitely something media the premium -- a the as of back world into product circumstances. I'd has broader of cost uncertain, on and to because question seen we'll was that we've in where, clearly, say on P&Ls and yet, client So the we nature the in this bring there's going mentioned pitch been that, of money, -- not of become is a pressure quality

where process in in circumstances a a seen that's think a definitely obviously way. go our we be didn't will that gating item a it So because and we've decision late benefit become

Operator

Our Fargo. Cahall Wells Steven with from question is next

Steven Cahall

discussing. in model. how of a places And how marketing. Could on principle-based was buying time then we that reposition in centralization context at relates to do media And with to think more you're expand internally, inorganic the as just just looking buying the the lot some as significant principal-based inorganic opportunities the you you the end media to of around as appetite your you shift changes That should around things there the specifically how like helpful well were opportunity retail about mentioned is. it internal maybe to

last That your transformative big think deal very Axciom. was -- I

Philippe Krakowsky

you But a XX-year at of yes. been kind if look following horizon going for I'm us like [indiscernible], probably who've only. folks

Steven Cahall

Yes, that's true.

least that So only delevered delever from and -- needed. shown you at quickly or you've as that really can

to potentially come. So it M&A teeing some sounds of like bigger you're kind up

and kind to then about you correctly. And about understanding we're and think want I the I'm correctly sure that of just all So do make that that thinking creative where for trend this.

it's I little it due just or that never away, part is think capabilities to some go It's due big of of to the it's our of to business. maybe some marketing still AI expansion makes being retail cheaper. while it's a whether concern whether the creative that is a devalued, going

you where do see of So part. creative the future the

Philippe Krakowsky

a That's Sure. lot.

it. into in you So it engage market, owners We're -- you will on go said, to I on with as and secure obviously, that have very the media inventory principal, focused the have sometime, take, we're the way. to

who understand obviously, of yields into that and benefits. got get the then, You've clients volume kind opt model the a to And benefit.

is to other be I few over going question, we're to go a scale, the comprehensive better tilt But And as by we're pace, that to efficiency, about So would the your talk is sort have, a as think at scale sale solution in said, to and some I least can at our because at them. -- you of of show think you will and there. up it more win media kinds to move bearing is. next heavily range mix that not a We of what terms valued and also, about very asset the whether doesn't that, course I clients sets with bit year. the the show again, clearly, M&A thoughtfully are of of even win going I things. On something in up do that's say these, you that certain space. But the how I it's capability with but

then engineering work, the processes and going help much of you down less rework kind would the more commerce as ways of including further define so in comm in side media can I are particular. in and I stack clients that the can that the be marketing. how retail their sort digital to they more on they but we and guess look it business transformation, And So focused on

We're going about think about I balanced us thoughtful And to how not were We transparent we inorganic very we very you were it where very the that might profile there be not it. But could growth that given scale or we kinds the did were quickly. areas well. change. we to why very That's will than think deals scale larger it clearly opportunities. in they're So But we things that, of said, you of as with one what business you I and to know are probably do Acxiom. modest going change of some doing been the how with time. for delevered out We're the maybe something the those for for, you M&A. known at going very or of be very I approach we -- with we've X look look, that

is observation question. helps that important that guess and my no, I -- And still unpack creative big hopefully, you very matters. So you then I creative a for idea still forgot. you is thinking. And the had the

because them for and a terms ideas clearly, a mission excited at [ week, in we're what is impact they driving news can look big their you that spin. this of who client out have coming about their If growth CeloNova big believe the of ]

out the it So us integrate you to for if you I so you a lot terrific I outcomes, I way. that it, basically components FCB think more the opportunities of thing, can tools what good other business that then actually pretty have said and your of right? get of around a and what where you outset to can be creativity. that driven. And have then you that in also have and bear creative GenAI of do you into how figure data has plug the stack, And done is important, job provide business incorporated essence the precise can in outcomes it you about at I think all craft bring And strategy ways. there's creativity is engage the is understanding important but take new brands as your about deep into where strategy and certain and incorporate think a and then sit And be

of ideation to can good faster better faster. hypothesis, -- You sort hypothesis and do hypothesis get

or been that to creativity Ancillary in You past. of distribute do it that audiences might can able democratize have partners a reach you and your in clients. lot ways not the

but be of of to ] relative one the [ have probably, So look we're going a about at still focused version our think yes. And addressed what there. might to some is peers, We to of underperformance going to said, to traditional as is I pushing which streamlined, more we be question and both we're said, them what going to or keep we're those transform. also that's I to needs exposure

Operator

with Our next question Macquarie. is Nollen from Tim

Tim Nollen

in I'm -- I this in with the week going be the IPG's stuff of you in comment, And news good the wonder work if interested all there. please, particular, not all do because you I'm Acxiom deprecating is cookies. on the could asking perspective, that first-party Google to and data

positive the it quite away. is maybe seems if all Or seems wonder, the I'm less than industry positive a removed positive? risk Acxiom the for like to of as sort maybe this as little had can of a guys, curious, But and stuff not important for it that So is you ad was is gone with great that been I disruption it later just and first-party is it do cookies data before. have

Just interpret news. how to know don't the

Philippe Krakowsky

it's we redefine. exactly even now, Well, know in out. pulled stop, start, it It's right? announced of how not to going kind at something on and start, back this stop, And don't So play unexpected point. know that I they've that necessarily is

be a clients. you're which And right think would to we I think a valuable proxies comfortable in very world heard more would go a away. you've long time with I say that even prepared that us and for feel world where Acxiom that, for be

than GDPR out, data. less when lost so And we our X% rolled of

there the and I think to data then space. of first-party speaks know-how the quality management So what's in it the

So we happy. be would than more

and stop done what a really you're need it ripped start of Band-Aid lot it would think take more they to control But clear right, I to made first-party that they to when have need a modest probably kind accelerant and has the gets their autonomy that of of comes eventually data, we off. it it's that. agency fully clients is be it if to welcome would that and

it. And of we're the of own ID opportunity happen. clients, about when we it, and of everybody company whether out that fully lot graph clarity think build the understanding including and still a I out, seeing their going called we're conversations benefit really in lack So how seeing wins it's to them from some to means and still help or used figure to the that of gotten we own can with that the that has

line, I if mean right. we would You're upside finally cross it to modest that a us. be incremental

Operator

Cameron with Stanley. question Morgan is McVeigh next from Our

Cameron McVeigh

output? ultimately increase Philippe, you if success And I'm the earlier potential revenue opportunity bit seeing mentioned AI. volume curious technology? of with tools at a this creative impact the total any from you're scale to to in GenAI what personalization looks looks like on like and some of about currently what implementing creative AI you

Philippe Krakowsky

of demand for everything. personalization is all that think for to right? Because think significant scale mean, to done personalization, need world I you at sort I more going used mass right. of gotten marketers we've I be Look, time, a [indiscernible] say Sure. some where The always

to are So what thing buckets. has And where business to into maybe been a about for parts AI that of I data, we would we media, right? you some our say performance. down couple break of talk the that, I'd AI core there do time,

undone rate in And going production platform what rapid are of right talent. can't of limitations, So of GenAI isn't I businesses. Then so think I are and that what solutions already required like commerce are think an constraint, and don't accelerate any incremental to kind our you us help need who some to the a limited want keep very, where CRM, is There to most tech have successful there have very be. right? up areas the change it's output tech think further and you budget I due with doesn't because either activities they the doing it opportunity client now is

we're reinvested. clients, higher-value economics cost our the whatever saw sort to that this So business And even of like in the of down. a going, right? see be okay, some unit tech of as you're the talking about of of partner kind to this, allowed you become But asset in goes scale engagement. can media the where We've seen resources us you of

the because way we in that had redistributed go highly we able skill of skilled sets upstream. in essence, command and couldn't saw with in to, were -- they folks hours You that else. What anywhere clients the get find labor

your the content what that and tool to give of the of part and be back how business. to the is be discipline out prior the important. is to them point quality have unique question, a of creative creation train going the to the that all begins which bringing to the these from data at is same to. Because going of need say, very bring you're judgment -- resources the of in it's need I we use tools whether folks the what of tech, see SaaS-like objectivity. In think cases, is sort we are very, And people there. to going or experience, and licenses to who bring also and work what all I have ability get talent changes, sophisticated, and who how nature the the And I everybody more and I'd the actually sets, some think So evolves. models reinvested, nature our got people some thing the you're the something then tools, the build our space you've then last these of the business, terrific to of with in then to sell scale really think once we of are lot of Because understand lot able quantity clients data you areas you a

training doing we're trained, our So again, do we're of clients, see of not doing go, for areas insisting there's a mean, and become business for get line folks a of now, -- but I a lot that's only that but our right we lot a ways actually to us.

going to be where all of seeing are be So showing I can't but and percent tell opportunities that this we're places up. going and x you these it's it's with that, clarity percent kind to conversations x

Operator

comes And Julien Barclays. our last from Roch question with

Julien Roch

is, get both us one organic [indiscernible] can basis gave first The we [indiscernible]. net the a sales. first revenue a than rather for on

capability is, many are now production? the ] your roof [ and ] employees in you WP like question Second Publicis [ how unified Omnicom have production one and

adjustment And than rather then lastly, range? to is quarter. why an QX the move X%

to X% there the X.X% thing you answer, to no afraid actually Does or before me. you now, more French such So on like [indiscernible]. really X% X% is as is I'm [indiscernible] have correct a as mean surprisingly and but is patented American it I precise dot X.X%,

Philippe Krakowsky

what, know we but Also, don't call you. you tell know what I here, so what it it's to

engine. production become last production evolved be the the we production, commerce. media And on have you've retail, heard about it's engineering in obviously scaled used us bit years, about activation, creativity, media X, data talk the So quite talent are we far it's way to X global In and strategic. more which integrated a and services, a moving to -- centralized platform because

all from ad that way optimize formats not get earned but the the tech and flight data right audiences, Adobe track we it's media. And do been in through studio the all and live. just right sitting Acxiom, So upstream. ecosystem across while. with in sort It GenAI now tag with to martech for has to it we underneath And strategic. us be the very production to that It what the we what Kinesso along very with we that so for teams, connectivity has while the can go to push out, moving then and the do what of taxonomy is do a

] So with just just obviously, was I it a part with work out Reed, the [ we've what won CeloNova]. of we've that [ and win called --

need hole. is that digital still as -- down have some to outliers we're still way think have deep there few with to we well the capabilities kind going that either and domain expertise I to built expertise, production of with operate specific a So unified be a there here the but or having

I'll because putting -- in And me, what number at look also out sure I I Remind our a organic the that take on then question question? were what So a net didn't question. understood that was not any that's the growth reporting know way than was first different who I'm we apologize. I basis. somebody one middle was

Julien Roch

why to the move X% X% last So surprisingly range with is adjustment being quarter precise. the QX rather question an than Sounds

X.X So Or like you [indiscernible]? it X.X% you mean X% X%? to do actually more is really when say

Philippe Krakowsky

the the chop moment. last We And X% said ago. approximately. off I which of conversation, has conversations into mean we definitely know taken the measure we're in back I water that X the a its had very there's months uncertainty since feels way table It think at worked like there's bit a you always direct. more

And [ it's us like we to approximately still say to the of so only ] middle there's that, some year. X% but when that ranginness the feels

to closer We're us -- it's to if X%. kind -- that it we're from that X% telling X% you So of to feels to being as it's not precise. moved

Operator

the call Philippe thoughts. for turn to And any now I'll back final

Philippe Krakowsky

Thank you, October. Sue. We the time you in the to interest. look and you. updating again appreciate Thank forward We

Operator

That you. Thank does today's conference. conclude

at disconnect this may You time.

The Interpublic Group of Companies, Inc. (IPG) 24 Jul 242024 Q2 Earnings call transcript