The holding company that has spent the better part of a decade insisting it is not merely an advertising company reported results on Wednesday that suggested, once again, that the advertising parts are doing rather well and the other parts are doing something else.
Publicis Groupe, the Paris-based communications and technology conglomerate, said net revenue for the third quarter reached 3.8 billion euros, or about $4.3 billion, representing organic growth of 5 percent. The company said it remained on track to meet its full-year guidance of 4.5 to 5 percent organic growth, which would represent its eighth consecutive year of outperforming the broader market.
The strongest performance came from what Publicis calls its Connected Media segment — encompassing media buying, commerce, customer relationship management and influencer marketing — which accounted for 62 percent of revenue and grew in the high single digits. The company attributed the gains to increased market share and, naturally, rising demand for products powered by artificial intelligence.
(What, you were expecting them to say demand was falling?)
The creative businesses, grouped under the heading Intelligent Creativity, grew in the low single digits, representing 25 percent of revenue. Technology services, which includes the digital transformation unit Sapient, declined slightly, a result the company attributed to client caution about large capital expenditures amid what it delicately termed "unimproved macroeconomic visibility."
The technology segment has been something of a recurring theme in Publicis earnings calls, performing below the rest of the portfolio while executives maintain that its strategic value to the whole exceeds what any standalone assessment might suggest. Madison & Wall, the advertising and marketing advisory firm, noted that the segment "continues to serve as a drag on the overall results" but agreed with management's position on Sapient's importance.
By region, the United States accounted for 59 percent of revenue and grew 4.5 percent, a creditable figure given that the comparable quarter last year was up more than 7 percent. China posted a 10.6 percent gain. Latin America rose 23.8 percent.
Arthur Sadoun, the chief executive, said in a statement that this represented the company's 25th consecutive quarter of outperformance, a streak he attributed to what Publicis has long called the Power of One — its model of integrating data, technology and talent across disciplines.
Mr. Sadoun also noted that the industry was consolidating around three global players: Publicis, Omnicom and WPP. He did not say whether he expected the other two to see it that way.
Original story published in MediaPost: "Publicis Added 5% Growth In Q3, Maintains Full-Year Outlook"