As Trump’s tariffs cause agency stock prices to plunge, it’s worth seeing which groups will be most impacted based on how vested their interests are in Asia. When comparing 2024 to 2023, here’s how the major advertising agency groups performed in Asia.
WPP:
revenue grew 0% at $3.35 billion.
Via the market cap, the agency stock trades at 4.43x the global net income.
Omnicom
revenue grew by 12.1% to $1.847 billion.
Via the market cap, the agency stock trades at 9.63x the global net income.
Publicis Groupe:
revenue grew 6.8% to $1.218 billion.
Via the market cap, the agency stock trades at 12.85x the global net income.
Denstu
revenue fell 0.8% to $778 million.
The stock trade multiplier could not be determined at the time of publishing.
The Interpublic Group of Companies:
revenue fell 6.5% to $659.6 million.
Via the market cap, the agency stock trades at 12.79x the global net income.
S4 Capital
revenue fell 16.7% to $43.3 million
Via the market cap, the agency stock trades at 2.44x the global net income.
Notes
As Donald Trump’s return to the White House neared, the offshore yuan plunged to its lowest level in more than two years against the US dollar. Heightened global uncertainties about renewed tariff threats caused this. This hurt China earnings for WPP and Dentsu. While WPP had no growth in revenue, it reduced its headcount from 32,000 to 30,000, thereby increasing revenue per employee by 6.6% from $104687.5 to $111,666. With 16,900 staff, Omnicom generated $109,289 revenue per employee.
The remaining agencies reported
– positive organic revenue growth in China, India, Australia, the Philippines and Thailand
– weakening of the Yen and Reminbi decreasing revenue for the year
– the five acquisitions by Publicis Groupe in 2024 placed agencies on the edge
– the merger of Omnicom and IPG placed all agencies on the edge
Advertising agencies will face reduced demand for their services due to the economic uncertainty caused by the tariffs. This reduced demand can lead to lower revenue and profitability, ultimately affecting their share prices.
