Omnicom sees 3.4% organic growth in Q1, net income falls 9.7%
Omnicom Group Inc. reported a revenue increase of 1.6% to $3.69 billion in the first quarter of 2025, up from $3.63 billion in the same period last year, supported by organic growth of 3.4%. Despite the uptick in revenue, net income declined by 9.7% to $287.7 million from $318.6 million in Q1 2024, while diluted earnings per share dropped to $1.45 from $1.59. The company’s operating margin also contracted year-on-year, falling to 12.3% from 13.2%, as it absorbed $33.8 million in acquisition-related expenses.
“Organic revenue growth for the first quarter was 3.4%. We are assessing the implications of economic and market events to determine how they will affect our clients and business for the remainder of 2025. While uncertainty has increased, one thing hasn’t changed and will always be true, Omnicom is a trusted partner for our clients, offering strategic advice to grow their sales while delivering flexibility, value and performance,” said John Wren, Chairman and Chief Executive Officer of Omnicom. “
"I am confident that our diversified portfolio and strong balance sheet, together with our experienced leadership teams, will allow us to navigate this challenging economic environment. We are also very excited about the expected closing of the Interpublic acquisition in the second half of this year. It will give the combined company substantial opportunities for revenue growth and distinctive cost synergy potential to drive increased profitability, EPS growth, and free cash flow.” he added.
The group posted revenue of $3.69 billion for the first quarter of 2025, marking a year-on-year increase of 1.6% compared to $3.63 billion in the corresponding quarter of 2024. The growth was driven primarily by a 3.4% rise in organic revenue, which amounted to $121.9 million. However, revenue was negatively impacted by foreign currency translation, which reduced the topline by $59.2 million, or 1.6%. Acquisition and disposition activity had a marginal effect, reducing revenue by 0.1%.
Regionally, organic growth was strongest in Latin America (14.8%) and Asia Pacific (6.0%), followed by the United States (4.6%) and Europe (1.7%). Other regions recorded declines, including the Middle East & Africa (-9.3%), Other North America (-3.6%), and the United Kingdom (-0.7%).
By discipline, Media & Advertising (7.2%) and Precision Marketing (5.8%) led growth, while Public Relations (-4.5%), Healthcare (-3.2%), Experiential (-1.5%), and Branding & Retail Commerce (-10.0%) experienced declines.
First quarter financial highlights
The group reported revenue of $3.69 billion for the quarter ended 31 March 2025, marking a year-over-year increase of 1.6%. Organic growth stood at 3.4%, while net income declined 9.7% to $287.7 million. Diluted earnings per share were reported at $1.45, compared to $1.59 in Q1 2024. On a non-GAAP basis, adjusted diluted earnings per share rose to $1.70 from $1.67.
Operating income declined to $452.6 million from $478.9 million, reflecting a margin contraction from 13.2% to 12.3%. This included $33.8 million in costs related to the pending acquisition of The Interpublic Group of Companies, Inc. (IPG), which lowered operating margin by 0.9 percentage points.
Adjusted EBITA increased slightly to $508.2 million, maintaining a 13.8% margin, while reported EBITA declined to $474.4 million.
Regional and disciplinary performance
Organic growth varied across disciplines. Media & Advertising led with 7.2% growth, followed by Precision Marketing at 5.8% and Execution & Support at 1.9%. Other segments recorded declines, including Public Relations (-4.5%), Healthcare (-3.2%), Experiential (-1.5%), and Branding & Retail Commerce (-10.0%). These figures reflect a realignment in service classification implemented in Q1 2025.
Regionally, Latin America posted the highest organic growth at 14.8%, followed by Asia Pacific at 6.0% and the United States at 4.6%. Europe’s Euro Markets recorded growth of 1.7%. Declines were seen in Other North America (-3.6%), the United Kingdom (-0.7%), and the Middle East & Africa (-9.3%).
Expense overview
Operating expenses rose 2.7% to $3.24 billion. Salary and service costs, which comprise a significant portion of total expenses, increased by 2.0% to $2.75 billion. Within this, salary and related costs declined by 3.6% due to restructuring efforts and workforce realignment, while third-party service costs rose 14.1% to $796.8 million, linked to growth in Media & Advertising and Precision Marketing. Third-party incidental costs also increased by 14.9% to $169.0 million.
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