Omnicom CEO John Wren sought to reassure investors over its merger with Interpublic Group during the company’s Q1 earnings call, restating that the deal is expected to close in the second half of 2025. Wren hit back at claims that the US agency group would lose clients and staff as a result of the merger, despite planning to make $750 million worth of cuts, including to “middle office and regional positions”. The company also cut 3,000 roles during 2024, according to estimates from Campaign.
But Wren said Omnicom was not at risk of losing “any client of any significance” due to the merger, and ruled out an exodus of accounts and employees. “That’s just nonsense fed by my competitors to the trade rags,” he commented, “that I’m going to lose people and I’m going to lose accounts and I’m going to lose this, that and the other thing: not true.”
The company also lowered its full-year guidance for 2025, as ongoing uncertainty over Donald Trump’s trade tariffs raises caution over ad spending this year. The agency group reduced the forecast range to 2.5-4.5 percent, down from the previous guidance of 3.5-4.5 percent.
On the earnings call, John Wren clarified that the holdco had yet to see any pullback from brands spending on advertising, but looming uncertainty over the implementation and impact of tariffs is casting “conservative” forecasts for the second half of the year. And Wren advised clients to keep spending before the reciprocal tariffs kick in.
“With the sensible delay of ninety days in the tariffs, I think it gives many of our clients the opportunity to acquire more inventory at reasonable prices and … look to front load sales in the first half of the year,” he said. “The uncertainty really comes in later on, in the third, fourth quarter.”
Ready for (trade) war
The agency saw a solid start to the year, reporting organic growth of 3.4 percent in Q1 2025, compared with the same quarter last year. Omnicom CFO Phil Angelastro said the company’s “geographic diversification” is expected to help it weather the global trade uncertainty, with Q1 growth driven by Latin America (+14.8 percent) and Asia Pacific (+6 percent). He noted that the US accounts for approximately half the group’s revenue, while China made up just 2 percent of revenue in 2024.
And the business is not overly reliant on the CPG sector, according to Wren, which is expected to be hit particularly hard by the tariffs. He said that CPG companies in-housing their advertising could “find themselves in a very uncomfortable position”, compared to those with agency partners able to navigate the economic uncertainty. And the agency is “planning very carefully and aggressively” to ensure its business is sufficiently insulated from any pause in spending that results from the tariffs.
“Since our last call, as you’re all keenly aware, there’s been increased volatility in the economy and the markets,” said Wren. “We’re assessing the implication of these events to determine how they will affect our clients and our business. As in past periods of uncertainty, our clients must continue to compete for share in a dynamic marketplace by investing and leveraging the strength of their brands and increasing and actively expanding their connection with customers.”
Meanwhile the business is leaning on AI to drive efficiencies for its staff and clients, according to Omnicom. OmniAI, the agency’s in-house AI platform, provides teams with generative AI models for text, graphics, video and audio, trained for agency-specific use cases. The company is aiming to have every client-facing employee using OmniAI by the end of the year.
“AI is touching every aspect of how our people work,” said Wren. “It augments our insights and creativity, increases the speed and volume of personalised content, raises the level of effectiveness in targeting customers, expands the knowledge of our talent, and makes our operations more efficient. All of this is driving transformative outcomes for our clients.”
Follow VideoWeek on LinkedIn.
