Net income and revenue declined for Interpublic Group in the second quarter, with the revenue outcome falling short of the expectations of industry analysts.
Interpublic ended the quarter with net income of $99 million, down nearly 3 percent from $101.7 million in the same quarter last year. Revenue in the period dipped more than 1 percent to $1.71 billion. Analysts had projected revenue growth of about 1 percent.
IPG attributed the revenue slip to account losses and currency fluctuations. Some clients also spent less on marketing, particularly in the retail and healthcare categories, according to IPG CEO Michael Roth. On an organic basis, revenue actually grew, albeit modestly at less than 1 percent.
The company still feels the impact of losses such as S.C. Johnson (global marketing services) and Microsoft (North American media), even though those companies moved to shift their business last year. Draftfcb bore the brunt of the SCJ loss and Universal McCann was the incumbent on the Microsoft media assignment.
In a statement, Roth said that the broader global economy "remains uncertain, which will require vigilance as we move through the balance of the year."
Roth added, however, that IPG is "nonetheless targeting stronger growth in the second half, in order to achieve our full-year 2012 objective of 3 percent revenue growth." In addition, he reaffirmed the company's other year-end goal: improving its operating margin by 50 basis points.
For the first half of 2012, revenue declined less than 1 percent to $3.22 billion, despite organic revenue growth of nearly 2 percent. Net income in the period totaled $53.1 million, down slightly from $53.6 million a year ago.