IPG - Earnings call transcript Q3 2024 | The Interpublic Group of Companies, Inc.

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Operator

Good morning, and welcome to the Interpublic Group Third Quarter 2024 Conference Call. [Operator Instructions] This conference is being recorded.

If you have any objections, you may disconnect at this time.

I would now like to introduce Mr. Jerry Leshne, Senior Vice President of Investor Relations. begin. may you Sir,

Jerome Leshne

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

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

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

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

greater refer We in our of and that, also these not the measures operational measures. useful financial performance. to will for We while believe GAAP that transparency certain non-GAAP for a review data supplemental substitute provide allow measures,

At is this to turn Philippe things to over pleasure point, Krakowsky. my it

Philippe Krakowsky

Jerry. Thanks,

additional the followed and our results some As Q&A. Ellen will usual, of view comments, agencies I'll our provide on start high-level your the business be highlights to at overall. a strategic conclude with with detail the and by and call then I'll quarter,

begin, To before was ago. expenses organically the revenue same year a billable in period unchanged our

at the the in standpoint sectors, well of disciplines, and From client Mediabrands, highlighted of relations saw strong other Acxiom, was IPG category growth offerings. growth Octagon, our our as public terms In and consumer very public and consumer-facing clients. sector by food like Deutsche as industries, quarter beverage goods, of and solid diversified we

weighed that the we've from on first which to due account year's half loss this of However, did previously, QX. timing in growth flow our growth mainly discussed an

in to talked the specialist in process, our those also address organic over X%. at sale. July about we actions held growth digital assets third we we that for strategic X performance To quarter, that the first the our as quarter in classified became months saw note, brings where to underperformance meaningful Reflecting are agencies. progress During had

Regionally, international in was paced flat organically. Continental Markets growth in our strong U.S. growth America, in the Latin with Other In were modest we group continued our Europe. operations, along quarter, the by in

the decreased ago. Asia from a U.K. Pac and year

our operating our our integrated IPG Advertising specialized by Solutions with of organic We Acxiom performance solutions, that saw Engagement Data but segment, in results communications growth at Shandwick drove segment Golin. mixed Media, and in Weber and experiential Creativity decrease tempered & was quarter agency. in growth by was segment, the at at Looking and by our segments. Octagon, and MRM. Mediabrands an driven And

of significant category retail in in performance, standpoint sector growth food sector, to saw sectors we goods tech solid transportation our care, in due account more telecom mentioned, increases client services as addition losses the had auto financial very and to and other modest the and and health From increases beverage and the and in and XXXX. in late Decreases in consumer sectors. the were

sale $XXX process digital the operating expenses with and we'll that Turning exclude quarter our and I third adjusted of noncash first our The today that R/GA related item. goodwill note to margin. metrics to progress our agencies impairment of expense specialist should and you noncash million included Huge. in cover

evolution to in with teams business. investment can continue our of ongoing effectively you cost As balance see, the discipline our

was was year, period year $XXX.X a Third and temporary had and same leverage incentives. our payroll, base last strong million. quarter ago, margin performance the matches labor Compared adjusted we which to EBITA on XX.X%, EBITA adjusted

for expense. well of senior business and was sale. technology, net increased $X.XX at and transformation also for of continue Office write-down goodwill, platform which, We and in the amortization higher as share as & the levels $X.XX and resources, particularly centralized earnings in in invest in as impact turn, acquired talent, to held intangibles for SG&A quarter per as resulted the Diluted reported business adjusted dispositions Other

shares, quarter, the shareholders. to million we million returning $XXX repurchased X.X During

outlook U.S. largest levels significant high and project markets, the political especially since the for many continue work excuse for to in growth that a our spend characterize are of margin of to That and our that consideration. in, in goal will revenue of well larger the season. deliver QX relatively believe QX play: X%. me, line the discretionary capitalizing we as AOR committed Turning XXXX said, And due assignments will a flow as to on year, that as would shown the international strong in growth, some year. top operating those we All for reviews. remainder to be reviews This head remains at given There year. the pipeline several -- work the the in our recent opportunities we of focused in account large in balance project approximately We're of is project XXXX news relevant of we we've holiday on headwinds have effect in take recent uncertainty facing the this new factors we level seen XX.X%. year of economic in the organic into remain for

profile. you need before line just I asset as structural and limited more growth to of make the at that have might more important, one speak of changes Many we sight rates have some growth Equally have change we're the to to we of As find as the leans to currently a mentioned, year looking market-facing to strongly our asset mix, capabilities close our that possible. mix to in to our competitors. me improve need and clear the heard heavily which

principal in progress all many Those has clients terms focused we shift always and transforming are buying accept even in impacted recent area an the that excelled, media, our embraced trading has areas the we business. on clearly which in have seen making business. on Also, are

portfolio. drive from to more necessary that in add underlying position of the and operational our bit the to I'll later. the financial solid changes score us have delivery which strong on very a composition Our and record a track capabilities within give foundation

for over more the a But quarter. to things turn I'll Ellen detailed now, of for view

Ellen Johnson

Philippe. Thank you,

that will remarks to the webcast. track my reminder, a accompany presentation slides As our

on Beginning net with X.X%, ago. flat third decreased or organic year revenue before Slide that the revenue with quarter with a our of X was presentation, the performance billable highlights expenses

revenue Our both unchanged was markets. and organic the U.S. net in our international

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

$XXX.X and the agencies a planned the Third adjusted value million, to recognized was fair quarter write-down related sale operations $XXX.X quarter, both of Huge. million of R/GA EBITA we goodwill XX.X%. In charge was and digital adjusted the our of specialist noncash in to the at margin and

of adjustments and the of adjusted. charge, operations a impact first intangibles $X.XX after-tax The of was goodwill impacts $X.XX certain shares held acquired X.X as and exclude reported $XXX the We year-to-date. X and share businesses quarter, per earnings for of diluted in repurchased for Our noncash impairment million nonoperating million to amortization as during the sales X.X months, the million shares returning $XXX the nonstrategic total sale. shareholders and our million of the

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

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

points. includes exchange acquisitions held-for-sale the quarter. impact Huge the -- R/GA Compared rates the revenue quarter change basis divestitures The net net to classification was in and of of of negative the 'XX, XX in change the during on impact billion. our X.X%, QX revenue which the and was $X.XX was Our negative

was revenue Our organic unchanged.

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

In showing of our mixed sectors quarter, client sectors third terms in of was with X performance the X client grown.

and and Our performance wins of notable our clients. also consumer in diversified The led in where and well tailwind a service as sector from we public grew account growth by had health as in sector very retail financial quarter. was the strong care, beverage, food and goods sectors in other

and and in in telecom XXXX. this due we the and look bottom at slide auto our saw is Going The to losses tech other transport segments. a of way, decreases account

growth increased & businesses decreases X.X% Our partly our media We organically. that though at solid performance Media Data MRM. again offset was saw segment Acxiom, by in Engagement at Solutions

X.X%. segment Creativity Our Led Solutions decreased & organically by Advertising Integrated

more strong McCann due Worldgroup, trailing headwinds We at Worldgroup that but revenue mainly have IPG growth to McCann and account at offset by very Deutsche, Health, decreases was losses. than from

Specialized and in our our X.X%, and Weber and growth public Octagon at Morton relations At organic & led by Communications Group in the Jack was segment, quarter. Momentum decreased Solutions growth growth Golin. at Experiential continued and Experential strong very

on That MRM performance. The and Moving revenue by in the very Octagon, X, at organically. to also was McCann. We U.S. at net growth Slide growth and portfolio, which regional view offset of Shandwick, Mediabrands, Acxiom. was at is decreases by organic in our Deutsch of were XX% notably revenue was and Health, net flat led domestic a IPG strong the solid Weber IPG quarter

soft performance decreased Italy in region. by which by continent, Germany offset Strong and quarter basis organically revenue of was quarter of of national in by saw revenue we advances portfolio. basis flat increased Mediabrands XX% performance the XX X% The our the points by quarter. on range net the Spain and Continental organically in represented France, were X% across points Among markets markets of in XX the net U.K. also Europe, organically. International largest and while revenue, decreased. the and were net a also was in growth

Pac in X% by organically. marked X.X% revenue the decreased markets across was quarter quarter our region. and Asia The net major of was the decreases in

Canada, all IPG were growth is net markets. flat. national major X% was and growth quarter, organically, by our In other and in group, we and in of LatAm net grew across Middle organic X% Mediabrands East led while of Middle McCann, markets revenue was We the revenue comprised with the of which the X.X% increases and in Canada, was with X.X%. our led quarter, Africa East by the

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

noncash our margin range acquired operating Our our ago, which adjusted unchanged line for business. The from XX.X%, net top which the amortization the the seasonal the excludes historically which X.X% result is reported impairment, quarter billable and was was net end EBITA decreased in with intangibles expenses, the at year revenue in our third of a of at decrease. was expenses,

by & a see tax to with and XX.X% we for payroll, was well XX.X% year on this as lower Underneath temporary expenses had total As benefits labor of compared incentives. our basis Related as percent ago. expenses that net base you points slide, as percentage can a revenue revenue net and result, of as Salaries a for decreased XXX

X.X% to up Our points of ticked basis net severance XX expense the revenue. in quarter

Our in on in basis X% appendix on an X.X% Slide ratios is organic total. from a ago XX. year these Each headcount of decreased the presented and

planned was slide, with have in Also Office previously. highlighted expense is transformation Direct of on & compared revenue our year comparison ago. net we technology investment as the a Other that Underneath XX.X% business and XX.X%

to levels The increase senior revenue investment ago. points year XX leadership net was and platform higher expense SG&A development. compared in basis reflects a strategic Our points basis XX with of enterprise

third adjusted reported of from to our results to adjustments on and transparency in results better with side right, detail the a order This quarter comparable picture steps EBITA left-hand to present through begins we to X, performance. our our Slide and diluted and adjusted EPS. On provide the on left reported

reported this as the of of income, operating foot expense Below the million. our $X.XX. of noting Our quarter was our is amortization the well slide earnings was bridges At the sale of net losses held the XX.X%. $X.XX million. rate as sold to of effective The EPS slide acquired the as $XX.X diluted reported adjusted of that goodwill at in and for It's bridge for was $XXX.X tax rate million. $X.X businesses worth adjusted noncash to intangibles impairment on

diluted adjustments similar the Adjusted for per tracks period. share the X was the for X-month period. $X.XX Slide earnings

capital in compared X, quarter. cash net have quarter compared our Slide third last CapEx. turn million $XXX.X primarily $XX.X with for Cash year flow million investing $XXX.X flow year. we from activities, ago. operations million with the to of was the Operating was the million, $XXX.X working a million in On cash before we $XXX.X In

regular $XXX.X share our is dividend the quarterly and million, financing in repurchases activities quarter. Our primarily for

Our net the for decrease cash was in $XX.X million. quarter

and maturities of Slide sheet. the of is XX $X.XX outstanding the ended XX the current balance our Slide billion We equivalents. portion cash our debt. depicts of quarter with

billion, $X.X can you schedule, at is was the debt total maturity As our quarter not next and until XXXX. on see end

XX. In Slide on summary,

and discipline balance our commercially. strong strength as continues, the that both financial as we remain and well Our sheet liquidity of positioned, means financially well

gratitude Philippe. my of express to And people. that, to like would I'll turn back efforts our the with it for I

Philippe Krakowsky

Thank you, Ellen.

same you investing with and stronger our time, we're and on our quarter, organizational the continues mentioned of address portfolio. I the areas to growth structure rapidly As of the to evolve, in underperforming areas business the call moving at last

an engine, When step the which of the we're Interact. just this forward data end-to-end intelligence that personalized the that announced is the on ideation, across activation earned with last Interact research, calling and front audience It framework channels. way launch was next production, all and marketing campaign through week, flow life our evolution integrates creative also cycle from programs. insights owned commerce audience and including powers and creation, to media as brand well optimization, as CRM of

privacy for Fueled partnerships the by incorporating AI compliant identity our connectivity resolution globally-scaled entire and It with in channels and tech agencies better infrastructure, the results real connects global all clients data agencies leading Interpublic's players our that can in capabilities our ID across and our and from and as real capabilities, about portfolio and Acxiom's space, technology actual so across Interact people reach. drive it touch points our marketing time. core media delivers serves

to dynamic informed speed improvements we our look key our media relevant very announced in last This will which which clients, market, space. to business is performance unified that for a enhancements in increasingly significant marketers Among increase week to particularly retail sales solution, network decisions investment in lead this includes the channels. especially is in make as

to greater As to and continue we've media that service been key is discussed, all performance the and from of to as we've vision, move to about, center of making production, and that activation. holistic ensures horizontal personalization offerings. solutions a capabilities commerce entire connected the our driven more is platform that to it corporate and is part Interact data portfolio talking the we'll

Mediabrands are premium environment time unit. offerings have the cost uncertainty as competitive performance data on in to a of we strong other ago, efficiency. much our tools over operating and greater our year a a core for macro said, expertise Now of clearly some bit factors our technology That and put very been media a and into where economic

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of Worth products that range order about media," all are deal broad noting activity, volume-based available marketers. there's when umbrella this we to for whether under value "principal in of generate types that's talk that actually a types,

strategic retail, an the purpose-built media to offering the a and to media certain solution buying brand includes those We need marketers approach includes pricing. that content principal other operate highly inventory. taken they by media meaning inventory the while owners current TV, skinny bit for like place a ads, meet the Our low-quality the ecosystem, This that value is get consumers the search all advantageous regulated can ensuring needs we full it's media digital put in options. ability who drive the formats. place of of safety. gives also clients, That exclude higher it's range us on of approach to Connected with value and guardrails that And social in industries necessary for bundle

offering, of from new existing trading prospective been opted within incremental new there's and dimension -- have in our in new practice strong the Since opted the early already We've business, seen and some fully clients. going to of media model wins in this forward year. many area, this as launching clients or interests

As scale, placed tech marketers. value to be also we we proposition before the well build into we'll and incorporate positioned data components that

moving for but from at store experiences. and for marketing capabilities the actionable platform. advanced recognized performance Awards the audiences, sets comes comprehensive MarTech noted omnichannel discussed already leadership when we've annual impactful integrating in some our Acxiom Acxiom, and insights was award resolution and now customer having to The it Media Acxiom's best brands assets, data to quarter. the the most highlights innovation operating cited Breakthrough of of deliver identity industry's our Now to people-based intelligence the and high-performance

In retained of Media review, and Unilever new several we global additional competitors. brands, the Media including won conclusion this Global quarter in assignments from markets Africa saw which Canada remit, and the North existing in

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influencer range by innovation, Health, of as created the and marketers of across Two of health lead continue clients, it as ago, tech in sector XX TiVo, IPG care influencers opinion Jazz we led last ID and and fueled comes recognition for tailored patient, our At categories The we medical provides Ingelheim, to the of Burn use weeks health in marketing health as and awards Health a to influencer well when of of Pharmaceuticals those power awards purpose-driven this industries marketing. work holding solutions including to as recently companies the clients. leader which quality at harness all campaign unit, best caregiver such winning the care they Pfizer marketing IPG trophies competition, seek media for was digital communities. premier

Deutsche been Pepper also breakthrough Based agency creative disposition mentioned our and Paint won work Taco our year. of quarter York Bell. follow-on the a rebrand to the in Among The agency Holiday for agencies, Behr has completed standout this Angeles, during launched Hill to earlier Deutsche and as Deutsche this earlier, as long-term and year. Dr. Los recently clients, a New a

significant Tac. At on for assignments included wins Peroni Ferrero Tic McCann, Kinder regional key the brands, record globally, quarter agency and and of

for creator the partnership will learned eligible it agency's that you're of L'Oreal, Because worth documentary also be nomination. honor in the to with the Oscar We an produced campaign,

recently The take rankings FCB IAC other we the York of the Company in Holding world with released of Awards, honored the New of the Network as Year continue saw Year. McCann the also the we XXXX where top industry-wide, the validation IPG the Festival offerings. named X quarter, top to during XX. creative spot our see segment, strength industry of within Still the New York agencies were And at was creative

our to segment. Turning SC&E

in Entertainment players XX & number the IOC partnership, follows AB clients participating and for Octagon, Olympic very extensions Cisco, X division, brand and more the of activating their in talent -- players Sports contract them supported the highest clients, strong new Octagon including paid assisted secured sponsorships, The Airlines clients agency InBev, player Our securing than posted a Games, NHL. also a in NBA landmark GEICO Toyota. MLB Delta growth. at making individual

announced client and marketing, with clinical Aspen partnerships practice content Weber leading the media growth In the company, groups, social. influencer and creation quarter earned including biopharmaceutical new space, saw Therapeutics. the Primark, stage good number Shandwick in of across a Group a Golin Bicycle

to continues AI executive on in we've Agency which programs with and learning board design, talent, employees to before, our AI invest training training does lot of global area of a in delivery drive new bringing development will Weber lead client multimodal worldwide, for base. the a as Golin's an mentioned who

quarter arrival Officer central needs the Other data, consumer a included and rate audience-led resources. exceptional all of IPG landscape, who of disciplines of at modern developments Strategy note our current and which our for at the of Chief and the in the into the platform lean help of level will other who understands our thinking practitioner Interpublic, accelerate announcement marketers

forward industry a an look to public production level. welcoming leader in who shortly, will helm also content strategy We

all globally. across AI breadth We've unified the Adobe, the engine the their our is and teams data production for common integrated as and content to of supply the deliver generative Interpublic, that insights our last Interact efficient and platform aspects connected agreement as announced activation. technology use with clients this mentioned earlier and of full have to for to the across year, group our marketing quarter, chain range As a solutions function

with technology accountability enhance the we've us allows work clients bring in maximizing business, champion is doing which clients, designating best outcomes delivering and we time. on side the to but and and of production, investments our an for the mass enterprise partnerships in that some the and the level this platform our of ensure and creative same owner AI. internal for also that Together, and driving layer media we're by to personalization business of CRM the been another And precision for we're important

disciplined a as now these creativity, So increasingly our an along us that Client level commerce out team appointments IPG round and in strong senior Chief integrated Officer Business and X and leaders corporate hole. can solutions forward architecture, with move

focused As XX.X%. X% achieving pipeline approximately the out strong remain on have organic longer-term at margin year discussed we finishing of on activity target that growth of EBITA adjusted and strongly, and to opportunities continue a both level, AOR focused and previously, QX of remain our

our brought of asset on digital beyond incremental connect in further which We're year mentioned the internal XXXX combinations some dispositions. the that that you in moving to at also from along. looking the we've this is and specialized Now to strategic through the mix portfolio streamlining we're growth begun would my to process earlier thinking or complementary achieve divestitures potential among with services. with actions the of -- drive topics of options agencies closely our scale X And process up remarks, at rebalance agencies, we to independent through us help to that looking speed

investments also our refining as estate even when and We teams That leadership done effective it mean level, further more actions, use making profitability. to better of and leveraging structural eliminate as We're enterprise believe of structure and collaboration international at unnecessary offshoring. services to real working both and and costs. such ways our growing to there's the comes more in to platform back-office moving use near many unified operational our will well be and of improve as assessing markets

represents development. clients organic 'XX scale meaningful and products, with its the That's drivers but reviews, growth impacts in additional that our forward, the competitive of terms benefits we allow on growth offer performance new current of we've morning this and Principal will existing us also roster, of going status a within into beyond only lever not for some to therefore, and a gone In Media. opportunity range detail as

talent limited We a scale M&A, in to years tactical of organic exception and that that are with actions growth being many can for Acxiom, area the change lean an course. accelerate in can in through strong one with is key the we'll which capabilities consistent of and range our which also asset investment [indiscernible] those M&A profile. achieved help us consider in and help us mix growth

see in Specifically, that's Technical specialized also with strategic Also, thrive. in reach retail data continue assets options ones certain and retail commerce platforms and opportunity scale we of consideration. international sector quickly a especially we're media. enhance companies to that's going in are given take technology that the and should to media growing our media to under offerings, markets

note, to believe type M&A always integrators of disciplined here our alluding capital been achievable, to is consistent activity we've businesses, strong long-standing to and commitment Important I'm return. we buyers with of and the

sheet a move of this significant foundation drivers set from transformational strong of forward which liquidity which Our actions, to provide and represents balance with value.

time Thanks for your today.

to point, our always, at the questions. And to this to let's As and floor thanks our open client also partners go people. your need

Operator

de And Instructions] question Adrien of Saint America. with Hilaire Bank comes [Operator our from first

Adrien de Saint Hilaire

I've got a please. couple of questions,

from in you for notwithstanding uncertainty guidance imply U.S. bit seems your So QX, little that the to improve a will that QX the talked 'XX about

the So what's that driving tone recent double-click exactly? just you on bit your with conversation if of a could curious clients? What's

on how organic your know big what business growth? secondly, new don't then I sales we a but we from do and net you know that And for think everything, XXXX always of is headwind to going today, be appreciate

Philippe Krakowsky

Sure.

a year. tone this business a bit journey has think of I been of

the to called the that the sort the level. uncertainty feel And on know, that in right are an the in of you geopolitical the global As if they're much were at heading, year in think environment, are we out like but operating into prior as creating a point, came improving. -- and quarters, I things U.S. policy at being then not But domestic fiscal we not definitely don't that saying pretty you the sense stuck impact such things was we social dramatically, direction. this

speaking, -- it's is -- looking given. fiscal clients the all everybody the that the becoming what a I of think And other things. of the to least political broadly side moving, assuming I happen, is the direction. think be people to think the past does policy, by of seem in situation get And are of global caused U.S., at And I regardless side becoming uncertainty through positive then will

up. of show but so up activity picking side we as seeing things And a can't and of said, look to really we're the both we're as QX, I project very pipeline we a definitely And opportunities seeing spoke has in to been lot active speak.

forward least integrated media So we've core number of now be at into or a of that to is principal beginning offering. kind to our got steps

an ahead And that's we've confirmed we've to a see the hard is creative announced in So to. would liked as year early not whether client go reversals, of a client, have go. in can did the got a pharma any we when a Amazon October, on then it's this where was the and headline clear and yet on couple the couple definitely not been And still that are year we for given with year. your wins on year broader of a not you're that we've obviously, on media decision that speak something it side therefore, question, had it it's to side, forecast

likely outs quite into what's line. ins But on a last So business. have you point yet through transparent headwinds and At to what of we're and about year of going really number that give we neutral yet. head we quarter, for at business going I But be in neutral, can is we're time. top obviously, we don't very sight on clearly, think the kind said point be next I that still that know XXXX, that year, when things we're mean, of we these that looking the will line the headwinds. in at the new always, this we into we'll, as

Operator

question from next JPMorgan. with Our David is Karnovsky

David Karnovsky

Philippe, as economic the project giving a you're in year-end. same you've uncertainty time, year-end visibility good highlighted the work. in consideration At the

if the to see two. could square you wanted Just

there. simply of moving Our are marketers regardless out whatever ahead, just concerns macro

Media clients. additive but in can noted Principal they is? -- just couple a accretive growth Why and this expand you would how Buying, to instead times of benefit, bit with that on existing then with you is be not why just And on review, you a clarify a spend just you? shifting clients of Can

Philippe Krakowsky

Sure.

question, first tone is the of business the would improving. the I Adrien's question, On say,

And the negative uncertainty to so this maybe an was date although incremental year. macro

just baked are it's with on been and people in just I think sort getting it. of

in feel so we more And improvement And as noise, it conviction. that notwithstanding the an if, saw does tone. there's

a And steps you definitely that has process, do be or then to on criteria driving it's in decision-making you series upstream. a it's of principal, of sort if moved meaningfully don't of I'm criterium the going used through to thought It more walk this. the

of Now for decision clients. it's the part many matrix

with, understand spend right? have you take of it's what the that do of we've and greatest sort which offerings there as of at we is then but is the to mean and have not I what gone to product the into budget not that bundled where data is to drive a go, market will are intersection the sort to that can and inventory value now client to which part you're So them. bundle that, technology, and a for But take said, marketplace solution, client, can does to of the to say what able been how we

true So our clients. that's business, a incremental of but of organic, not new with why as opportunity driver we see organic existing sort it

who other go the other in you are thoughtful you how to that have very with. the and has to choiceful go to market thing and implications -- it of terms you think be I market

obviously that the that pick media your clients, I share And So you that as in we bigger, benefits value but fewer, well. to more strategic creates on then think partnerships side. owner

And to look make that media you the on observation sort if I last in the of the is sort trading underlying going been side. sides coin, think I of of the there's called then would an at X it, terms shift the a,

much media. total on one front Our model predicated a is end on very agnosticism and consultative

period, last shift better as have in So XX-month has this XX-ish, call been positioned. others that it, happen,

of coin that fast I upside a But a side that ahead. think is the of got as other we've lot follower,

are we've we this already applying said it. billings whereas market committed along of essentially who perhaps got significant senior others that unencumbered our into One model, haven't have this sort of into model with further in leaned media the folks

greenfield, also will but kind So terms is for benefit there's good we of what we can us. more in of that think, that clients, do

Operator

is question Nollen with Macquarie. from next Our Tim

Tim Nollen

things about to if what's quite wanted on bit guess, reorganizations question going a to up bit a I give through? your I organically, there's be wonder that more working comments seems of like I you're terms So us been you already. on could and the, in -- of or your follow some internal scope moves. of the going It

kind and what's Huge then So M&A? us we are that kind R/GA know external for appetite at And And potential looking and externally, the on Could update an divestitures? Huge? on you internal give reorganizations. together of R/GA you all of block. Are other your and

Philippe Krakowsky

I got have well. we've very worked of Well, think a that group assets

You it's and complexity business, -- to scale it. a service are a of got and it's lot

about deliberate and to want you changes, make thoughtful to going you're be it. as So

see think, we've with I think that how I all and there through process line that very you there conclusion led Huge obviously to along that we noise to, of sight okay, the R/GA. to we've and that is side, has says, about on what upfront and a But sitting of are thought feel you process. We're have that a the been far event it us you we goodwill enough vis-a-vis I moved goodwill. think where direct the triggering clearly how and on that that

the So track. it's a good ways down

at or wood look lot to all into knock conversations. well staring want of the superstitious, of try We're a who has we're me to gone tracks on you not don't anybody that, because work -- feel lot sort at of we down but be might room obviously like talk a I'll the daggers that. And in

I when question we excellence. create think talked your fact about on that we've centers see benefit of or scale -- combined we the

still and company going to they like of on a I to upon some would or of better to perform leadership, us terms there we're sorting is these all assets company go carrying whether legacy to don't were sort if our So holding try being not centralized any in think space, putting push of incumbent miniature alike in whether versions not that recreate of are way through together we're by the but things

sense, you there are Dispositions, asset I got look bit to a mix. holding think openness our addition and our is growth makes subtraction what profile as things when back, we'll of of I about that you've at and a talked by function

that's definitely I think apply here to around a So we going going to a the be filter lot of forward. decision-making

is accrued. from it's the for media. scale competitors out talent. a clearly you've look I at that us. media have post-pandemic, on the And worked It's commerce build of of seen and rate But it then to and always very, been We've the think retail whether very well you benefits activity change some the at whether opportunity something, that it's connected M&A, retail

platform our with -- you really now can push of with just Gen all. combine you can and -- sort AI, can it connect And you

group. through You've got line a across the

on piece still. or think, the of that that's key X push So I priorities I 'XX said, in as X harder another will

Operator

question Wells next Our with comes from Fargo. Steven Cahall

Steven Cahall

just on Philippe. first, a last statements, follow-up Maybe those

and things some doing you improve mentioned portfolio. sheet strong of balance to look So the to the you're

to I investments. take sorry, that think organic inorganic -- I mean

others. I you that's principal retail see that or whether capability inorganic So some or considering to just growth, media if potential buying drive wanted you confirm to are

year. if just that correct? And Ellen, could is scope something help frame then, or we what was maybe -- us be the think modest. more for be about the the the bit Acxiom So of as you X% as appetite that once could And guide could within big your so, on a as

what How organic Huge think growth. you from about do I R/GA them quarterly do that? we think and the that removed within

the they're back of for guessing half I'm the year. out So

happened correct? Huge that to what the the is on change can R/GA with And underlying any was guide So rest business? the we interpret there that real and of into based

Philippe Krakowsky

first your one. prior on answer I'll go Ellen pile the let on my question, sort I'll and to of

Ellen Johnson

Sure.

And in the fundamentally in does sales been enough consistent to from and the R/GA in We just far don't the X% that with the became business the applies. along we've removing process think practice quarter. rest very we've underlying that with changed convention it July. guided asset beginning held-for-sale you I our organic of the accounting for year has anything Huge. exclude to of Our

Philippe Krakowsky

operations. your play. cleanup to retail of role international media definitely And think It's happens the have has would are are so focused places tech dispositions what go. that was just prior minimis on the assets. past mostly because a something I And These it in we prior, the we've small throughout. you where probably doing larger done question, It seen I are platform before most de think inorganic than us

Obviously, valuable space space, deals you the of But around that and some been are look they're in and clearly multiples have assets. the done rich. of late that in the around pretty

that tech in there's As incremental around interested potentially I I We're that with. pointed also assets specialized in. said, and out data comes space.

those So I prioritization. meaningful of rise to kind think

a we're in kind put to effect. Principal, position of into

next said, out to it have to of part developing it it now a markets. X as enhancing built that technology in We'll it of into X markets clear layer It it. adding is roll plan year. by and international the There's and more by it We offering. be, I data sort out rolling to very

there. said, it. opportunistic comes that So I is at If makes along as I look sense, we'll required don't think inorganic particularly something

Operator

from Michael The next comes MoffettNathanson. with Nathanson question

Michael Nathanson

for you Question Ellen.

you point you're competitors being you one. the go of us ahead you kind pipeline bit Principal ahead a your a unencumbered then have discussions? idea about you. through open, about of an the to That's in clients approach slate help billings our talk finding versus you took done? with you follower fast made Media about and Can having potentially On of those as protect what And could when the anything what

Philippe Krakowsky

tried as all in the were. I've for to prepared that Sure. I parts But you adoption really say would it unpack mean component the you to remarks. I sort of

a U.S. in terms at be client we that would where base, overall sense had of point we the Mediabrands opt-ins. of So

And you're it. conversations place take that the XX lot to understand people rigor around. to because, XX, of conversations a need clearly, there's need in talking XX, And

to As is into. we said, all everybody guardrails, engage to of opting what clarity choosing as everybody and the

found ahead we this that we So thought tracking are of they -- where conversations be would those have point. at

media happens we and the where the obviously, they're that's of America, in standing we've a that you, that's to the Latin largest of of world, Australia of X said markets kind got X I big the whether have where a or a to in ones ones couple whether others. them significant U.S., it number ex are line very and markets As so or sight scale,

that understand kind them where and current can this into of owners So currently media the we ways additive structured we in about are like deals where point, is. sense, at are standard move are can at, of that we feel heads clearly then think And conversations kind whatever the quickly. in how walking or

do data changes I We also sizable the table a also and assets in bit. the bring the a math you nature to very of that think what can

in to into go because that. there But coin. of find there's you kind that very do mature it's more capability. there's to we this I at mean, definitely much awkward point, enough kind And I much the been see are like X to might -- a really more sides how was you can't more that see not But said, we if upside to I give But this that setting it's this our friend than is that, it than which an of proprietary date. opportunity already

going remind And question. Well, other us was the of No, then the I had -- for other buy. for me that be. to is question it Ellen to

Michael Nathanson

feel I better.

Philippe Krakowsky

to for I growth growth for us better organic would said apples-to-apples if back you give of much kind Huge was be, your organic your I Exactly. year, you reclassify how her had [indiscernible] be? R/GA and Ellen Okay. So what to for and the X would believe then if the right? I going ask year,

Ellen Johnson

what When back we and July, it transparent of very to We'd guidance, what the that Huge. we I thought this up gave our calculation. have point go it event. been We've and was do but in R/GA you that you drag for mentioned been to on has of as to think a year. the the would held the tone rest about the wait sale, have triggering for probable We've color of get we asset classified lot given on for as

for at think leave that now. So I I'll it

Operator

Partners. Huber with question Research from next Craig comes Huber Our

Craig Huber

questions. two Just

into want like mean year what year the today, wondering organic next year thinking knows you'd XXXX to you your growth touched have be be have I you head. that XXXX? -- no my the year for the if to to on points. losses of right the know one what so now, for if first willing headwind but this you're a in you get percentage before, sense I XXXX. would First, for XX what headwind I I'm if share number ended the That's the surely, question, the ended know net just roughly today, please. ended a mean is going headwind I

Philippe Krakowsky

That's not it works. how

can kind answer, ins a not that close build it's sense we right, -- the the question as a of plan goes that from outs. all we in the we and So year,

you And so awkward we've are what's because it's what's to well, not and and an question math like, it -- what it's done, in not. answer becomes that

said, it's that not in a joint. the number. And as number, side? ahead because offering it, than -- or simply October, expect do that we and clients while remember be what been less ever a I I gee, any you we I forecast year And for growth answer this a might answer opportunities not the have product can I say, can there -- out number when would whether that now and I It's of think a it's year might to this can't so actually a have run that it's take question you to on baked be us slope in assume, how you of us more diversified and the put gee, business, how year don't organic that would you can been number that around media then --

I question. So the understand

production the more what -- so how fences working and sort I that on math on has guess does it, IPG but self-help going that than I which to opportunity figure data push a get that you're to you're of that all to better super with that on losses, be very meaningfully do? creates think get more organic trying ways going these answer solution on where purely constructive -- trying a different we X it's that's unified side, and on Z, these not ring in a place. to opportunities just there's X, the tech there'll Y but the what's out that's true to component platform And of And of a

think don't I we answer have So to that. an

Craig Huber

also please? Okay. And for and could. those help us your my you technology did care Huge year-over-year, health how you just organically aside second year-over-year did the Can sectors putting issues? what and question, if I understand X area R/GA guys Just

Philippe Krakowsky

an Huge had very their the Tech and talk issue, R/GA kind of we And also as about significant activity. their X a had world brakes always of had client then handful roster. the the tech hit of on said, we'd of companies fact weighting in largest pretty that the we hard

of that the we think for the back But you on in is you. I midsized side was that the if a it loss a losses, there's think take modest called that going category. out telco I out sort media mostly So

gotten more out, looking take you as sector We're bit sector that a kind macro It's growing not across think a a is found I in place. we has has of where said, it's all there definitely that will if caps, seeing clearly floor whole a more healthier. conviction a that be, If conviction. to and better client as thriving, base. at But all but that's

client that portion reconsidering then client health by is that. of a big And weighted care one then the became a

you. led care to first we, strong for performer. has care the our year an it So -- the to quarter, view the consider health top But there was large had asset on us was health think, client I it unpacked line. been and space, our It impact in which consistent a a in

that's the -- clearly to in be out going so quarters. cycling of couple of of next the that we're And sort

Operator

back it question. our was any final I'll last that thoughts. to And turn now Philippe for

Philippe Krakowsky

Sue. you, Thank

see leverage opportunities of where because on actions thinking point the I we've something that successful and think months been there's kind go-forward growth, see the to that's and clearly of again of the which structural like and I kind questions runway challenging. positioning where more mean that where been of realigning portfolio to core that last, But we feeling longer-term and focus we're our said, to XX been essentially is, our XX the we opportunity as get then continued more resources is the to effectively from view a still probability at. differentiated have

So and to we look stay tuned, forward talking February. in

Operator

concludes Thank you. today's This conference.

at You this may time. disconnect

The Interpublic Group of Companies, Inc. (IPG) 22 Oct 242024 Q3 Earnings call transcript