Omnicom doubles cost-saving target to $1.5 billion after IPG acquisition

Omnicom Group has doubled its cost-saving target to $1.5 billion following its acquisition of Interpublic Group (IPG), according to media reports and the agency’s first financial results since the deal closed in November.

The global advertising group said it expects to deliver about $900 million of the savings in 2026, with the majority coming from lower labour-related costs. Around $650 million of the total savings is projected to come from headcount reductions, including the elimination of overlapping corporate and operational roles.

John Wren, Chief Executive Officer, Omnicom Group, as quoted in the report, said that integration planning had identified “significantly greater synergies than we had initially communicated at the announcement of the Interpublic acquisition.” He said the agency aims to achieve $1 billion in savings from labour reductions and will streamline regional, country and brand structures, shifting to a more unified resourcing model with increased outsourcing and offshoring.

“Additionally, across every area of our business, we are evaluating and deploying automation and AI to improve how we service our clients and run our operations,” Wren said. He also cited $240 million in expected synergies from real estate consolidation.

For the December quarter, Omnicom reported revenue of about $5.5 billion, up nearly 28% year-on-year, reflecting one month of IPG’s contribution. The company recorded a net loss of about $0.9 billion in the quarter and severance and repositioning costs of $1.1 billion. For the full year, revenue rose to $17.27 billion, while the company posted a net loss of $54.5 million.

Phil Angelastro, Chief Financial Officer, Omnicom Group, said the agency did not provide standard organic revenue growth metrics due to the scale of the integration and planned portfolio changes. He said that, excluding planned dispositions and assets held for sale, organic growth in the December quarter would have been about 4%.

Omnicom said it plans to divest or exit non-strategic or underperforming businesses representing about $2.5 billion in annual revenue. It also intends to reduce ownership stakes in smaller markets generating roughly $700 million annually, describing the move as organisational rather than performance-related.

The agency’s detailed 2026 planning will be shared at an investor day next month.