IPG reports a decline of 6.4% in total revenue to $2.54 billion in Q2 FY2025

New Delhi: The Interpublic Group of Companies reported total revenue of $2.54 billion, a 6.4% decrease from $2.71 billion in Q2 2024, primarily due to a 3.5% organic net revenue decline and the impact of strategic dispositions. 

Net income for Q2 2025 was $162.5 million, which included an after-tax expense of $88.4 million related to ongoing strategic restructuring efforts. 

Excluding these charges, adjusted EBITA before restructuring and deal costs reached $393.7 million, achieving a margin of 18.1% on revenue before billable expenses. This strong margin reflects significant progress in IPG’s transformation program and improved operational performance at its two largest units.

CEO Philippe Krakowsky highlighted the company’s performance, stating, “Organic revenue was in line with expectations, reflecting the impact of account activity in 2024. Underlying growth in the quarter showed sequential improvement, with strong performance in our media, healthcare, sports marketing, and public relations disciplines.” 

He emphasised the company’s focus on strategic transformation, which has bolstered financial discipline and operational efficiency.

The company’s operating expenses, excluding billable expenses, restructuring charges, deal costs, and amortisation, decreased by 10.5% compared to Q2 2024, driven by a reduced staff cost ratio of 63.4% from 66.9% a year ago. 

IPG’s restructuring efforts, initiated in Q1 2025, incurred $118.0 million in charges during the quarter, with total restructuring costs for the first half of 2025 amounting to $321.3 million. The company anticipates total restructuring charges of $375–$400 million by year-end, aimed at enhancing offerings and driving significant expense savings.

IPG also reported progress on its planned merger with Omnicom, expected to close in the second half of 2025. 

“This combination will position us to grow our clients’ businesses and drive significant value for stakeholders,” Krakowsky noted.

H1 2025 total revenue, which includes billable expenses, was $4.86 billion, compared to $5.21 billion in the first half of 2024.

Revenue before billable expenses ("net revenue") was $4.17 billion in H1 FY2025, a reported decrease of 7.6% from the first half of 2024, which reflects a net decrease due to strategic dispositions of 3.6%, an organic decrease of 3.6%, and a negative impact of foreign currency translation of 0.4%, compared to the first half of 2024.

Despite the revenue decline, IPG maintained its full-year guidance, projecting an organic net revenue decrease of 1–2% but expecting to exceed its previously announced adjusted EBITA margin target of 16.6%.