Omnicom's first quarter as the 'new' combined entity with Interpublic showed strong organic growth of 3.9% and significant EBITDA margin expansion, driven by successful integration synergies. Management is upbeat, raising EPS growth expectations and highlighting wins in new business and AI-driven capabilities, while downplaying the impact of assets held for sale. Core operations revenue grew 6.7% organically to $5.6 billion, with adjusted EBITDA margins up 240bps to 14.8%.
Omnicom's first quarter as the 'new' combined entity with Interpublic showed strong organic growth of 3.9% and significant EBITDA margin expansion, driven by successful integration synergies. Management is upbeat, raising EPS growth expectations and highlighting wins in new business and AI-driven capabilities, while downplaying the impact of assets held for sale. Core operations revenue grew 6.7% organically to $5.6 billion, with adjusted EBITDA margins up 240bps to 14.8%.
Omnicom's first quarter as the 'new' combined entity with Interpublic showed strong organic growth of 3.9% and significant EBITDA margin expansion, driven by successful integration synergies. Management is upbeat, raising EPS growth expectations and highlighting wins in new…
Reported gross margin was 14.56%, reinforcing the quarter's better-than-guided profitability.
Guidance tone
Integration is progressing rapidly, with over 20 agency brands merged and $2.8 billion in shares repurchased.
Management is scaling agentic AI across the organization via Omni, with advancements in media buying (AdCP protocol, agent-to-agent transactions) and data integration (Axiom Real ID) intended to shorten the media supply chain and drive client performance. They see AI as a means to enhance productivity, reduce manual work, and increase revenue through performance-based pricing.
Advertising revenue declined in Q1. Management expressed strong confidence in integration progress, synergy realization, and growth prospects, while acknowledging geopolitical uncertainties.
Capital expenditures were $61 million in Q1 2026, higher than the prior year due to the Interpublic acquisition, but at the same level relative to the size of the business.
Management expressed strong confidence in integration progress, synergy realization, and growth prospects, while acknowledging geopolitical uncertainties.
“some of those businesses that we're disposing of, we're actually disposed of. There was a meaningful... the revenues are down because the business was sold. So it isn't a performance thing.”
“We've actually executed real media buys for several clients using our agent framework, doing agent-to-agent buying, which is all in service to shortening the media supply chain.”
“The quality and the fidelity of the data that Axiom gathers has not changed in that five or seven-year period... And so we're able to ingest and use this to develop our Axiom customer ID methodology.”
“clients are becoming more focused on selecting a single provider to take care of most of their needs. And we saw during the quarter that we were able to extend to multi-year contracts quite a number of clients.”
Winning IBM as a new client indicates significant marketing spend commitments, potentially at the expense of competitors.
“In the first quarter, these include IBM, GSK, John Deere, Little Caesars, Acadia Pharmaceuticals, and Bailey's.”
… the result of us realigning our portfolio for growth and moving decisively on our integration efforts. By integrating our capabilities upon closing, we merged or sunset more than 20 major agency brands with a long tail of smaller brands. This allowed us to quickly bring together the best talent from across the new Omnicom. Combined with our integrated client leaders and new strategy and growth teams, our efforts have translated into new business wins. In the first quarter, these include IBM, GSK, John Deere, Little Caesars, Acadia Pharmaceuticals, and Bailey's. We're not just winning new clients, we're expanding our relationships with existing ones. Our integrated approach is making it easier for clients to access all their marketing and sales needs from a single partner. This model has gained traction across a number of our clients, including Clorox, Dyson, Delta, Exxon, Kroger, Merck, and Unilever. Our growth from integrated services is helping to diversify our revenue streams and deepen our client relationships, underscoring the strength of our offerings. As we discussed at our investor day last month, Omni, our AI-enabled intelligent sales and marketing platform, is …
Expanding relationship with Clorox suggests deeper integration and potential higher spend with Omnicom for its marketing needs.
“This model has gained traction across a number of our clients, including Clorox, Dyson, Delta, Exxon, Kroger, Merck, and Unilever.”
… our integrated client leaders and new strategy and growth teams, our efforts have translated into new business wins. In the first quarter, these include IBM, GSK, John Deere, Little Caesars, Acadia Pharmaceuticals, and Bailey's. We're not just winning new clients, we're expanding our relationships with existing ones. Our integrated approach is making it easier for clients to access all their marketing and sales needs from a single partner. This model has gained traction across a number of our clients, including Clorox, Dyson, Delta, Exxon, Kroger, Merck, and Unilever. Our growth from integrated services is helping to diversify our revenue streams and deepen our client relationships, underscoring the strength of our offerings. As we discussed at our investor day last month, Omni, our AI-enabled intelligent sales and marketing platform, is connecting our talent, data, and services. We've scaled our next generation of Omni across the entire organization in Q1, putting the latest agentic AI tools in the hands of all of our employees. The new Omni is delivering on multiple fronts, driving stronger media performance, greater addressability, and improved measurement, increasing …
Omnicom is integrating IPG's operations, realizing synergies and driving growth, directly impacting IPG's former business units.
“Since closing the interpublic acquisition just before the holidays, we've seen momentum and cohesive growth across the organization.”
Thank you, Greg, and good afternoon, everyone. Thank you for joining us today. I'm pleased to share highlights from our first quarter as the new Omnicom. Since closing the interpublic acquisition just before the holidays, we've seen momentum and cohesive growth across the organization. Our steady progress is reflected in our strong financial performance and in the first quarter. As you'll recall from our fourth quarter call and investor day, we've strategically repositioned our portfolio for growth. As part of the portfolio realignment, we identified planned asset sales and disposition of businesses with approximately $3.2 billion of annual revenue, of which approximately $1 billion was disposed of in the first quarter. Our plan is to sell or exit the remaining assets in the next several quarters. To clarify our focus on the operations that will drive growth, we've excluded assets held for sell and plan disposition from our core operations. Revenue from core operations was $5.6 billion in the first quarter, which increased $345 million when compared to Q1 2025 revenue from core operations for the combined Omnicom and Interpublic. Organic revenue growth was 3.9%. We also updated …
Closer partnership with Omnicom could strengthen Amazon's advertising and retail media offerings, increasing its value to advertisers.
… our talent, data, and services. We've scaled our next generation of Omni across the entire organization in Q1, putting the latest agentic AI tools in the hands of all of our employees. The new Omni is delivering on multiple fronts, driving stronger media performance, greater addressability, and improved measurement, increasing speed to activation and enhancing ROI with Axiom's Real ID, improving performance across retail and commerce channels, and enabling more effective marketing and client outcomes through deeper integrations with partners like Adobe and Amazon. We also made significant progress to accelerate collaboration across the group. Throughout the quarter, we continue to move into hub building locations, deploy common HR and IT platforms, and migrate teams to shared workflow systems. As we look ahead, we will continue to work towards the initiatives we've communicated in our prior calls, including $900 million in 2026 cost reduction synergies and $1.5 billion by mid-2028. $5 billion in share repurchases over the next 12 months, including a $2.5 billion accelerated share repurchase program currently being executed. Through the ASR and open market purchases, we …
Omnicom is focusing on securing multi-year, single-provider contracts with large advertisers, a trend that could lock in revenue and reduce churn for the agency, but simultaneously make it harder for competitors to win business. — Suggests a consolidating agency market where scale and integrated offerings win, potentially stealing market share from smaller or less-integrated competitors.
Thank you. First, I was wondering if you could talk a little more about some of the revenue by discipline. So I was just wondering if we could get some underlying trends or even growth rates, especially of what you're seeing in integrated media versus advertising versus health. to kind of understand the trajectories. You talked a lot about those disciplines at the Investor Day, so we'd love to understand how they're trending. And then, Phil, I was just wondering if you cared to provide any additional update to the adjusted EPS growth guidance. I think the prior guidance is double-digit. I mean, you said that the share count alone gets you to 8% to 9% this year, so it seems like it's going…
Yeah, Stephen, the only thing I would add to what Phil said was, and I mentioned this in my comments, we remain very healthy in terms of competition, in terms of winning our fair share of new business. And that's great considering we're bringing two big organizations together in such a very short period of time. We're functioning very well. But if there's an underlying trend that's out there, it's really clients, especially with the change in the landscape of the industry, clients are becoming more focused on selecting a single provider to take care of most of their needs. And we saw during the quarter that we were able to extend to multi-year contracts quite a number of clients. And that's a focus that we're going to continue to work on as we get further and further into the year. That gives us security and that gives us a better ability to plan as we move forward. And it's our size, it's our influence that is contributing to all this, not to mention the state-of-the-art investments we've made in terms of Omni and Omni AI and the breakthroughs and the contributions we're making there. So that's all I would add to the color that Phil mentioned.
Omnicom is executing real agent-to-agent media buys for clients, a move that shortens the supply chain and reduces the 'toll' taken by intermediaries, potentially disrupting the ad tech ecosystem.
Omnicom's AI platform, Omni, combined with Axiom's high-fidelity data is providing a competitive edge in winning and expanding client relationships, indicating a growing moat in data-driven marketing.