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IPG reports 1.7% surge in organic net revenue YoY in Q4FY23

Tech and telecom advertisers, contributing 12% of IPG's 2023 revenue, significantly reduced their ad spending last year

Interpublic Group (IPG), global provider of marketing solutions, reported steady organic net revenue in 2023, showing a slight decrease of 0.1% to $9.4 billion compared to 2022.

It saw improved performance in Q4 compared to previous quarters, with organic net revenue rising 1.7% year-over-year to $2.59 billion from $2.55 billion in Q4 2022.

Total revenue for Q4FY23, inclusive of billable expenses, reached $3.02 billion, up from $2.99 billion in Q4 2022.

Operating income for Q4 2023 amounted to $606.8 million, with restructuring charges of $0.8 million, compared to $444.6 million in Q4 2022, with restructuring charges of $101.7 million.

Adjusted EBITA before restructuring charges stood at $628.5 million for Q4 2023, up from $568.4 million in the same period of 2022.

Tech and telecom advertisers, contributing 12% of IPG's 2023 revenue (down from 15% in 2022), significantly reduced their ad spending last year. This decline in tech spending impacted IPG's organic growth by 2.5% in Q4 and 2.2% for the full year.

Philippe Krakowsky, IPG's CEO, expressed satisfaction with the fourth-quarter growth, exceeding expectations despite macro uncertainties and challenges from clients in the technology sector. Krakowsky highlighted the company's strengths in media, healthcare, and specialty marketing services, acknowledging the ongoing impact of market dynamics as they enter 2024.

IPG plans to invest approximately $80 million in AI this year, spanning software, licenses, partnerships with AI vendors such as Amazon, Adobe, Microsoft, Google, Getty, and OpenAI, along with in-house development and training initiatives.

While IPG's AI investment falls short of Publicis Groupe's projected $326 million over three years and WPP's planned $317 million annual investment, Krakowsky noted IPG's utilization of generative AI for research, data analysis, creative brainstorming, and brand campaign activation.

Info@BestMediaInfo.com

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