10-Q · July 29, 2026
Omnicom delivered sharply higher Q2 reported results, with revenue up 63.4% to $6.5625 billion, operating margin up 320 basis points to 14.1%, and diluted EPS up 58.8% to $2.08; reported growth was principally driven by…
Earnings analysis · 10-Q
OMC earnings analysis
Filed October 23, 2026 · Our reading of the company's report
The latest report
Omnicom delivered strong third-quarter operating performance, with revenue up 59.1% to $6.423 billion, organic growth of 7.2%, operating margin expansion to 15.4%, and diluted EPS up 36.0% to $2.38. Growth was…
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Omnicom delivered strong third-quarter operating performance, with revenue up 59.1% to $6.423 billion, organic growth of 7.2%, operating margin expansion to 15.4%, and diluted EPS up 36.0% to $2.38. Growth was broad-based across all five disciplines, although much of the reported increase reflects the IPG merger. Liquidity is the principal concern: nine-month operating cash flow was only $37.8 million, cash fell to $3.796 billion, and net debt rose to $6.222 billion after substantial repurchases and integration-related spending.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $2.38
- Operating margin
- 15.4%
What stood out
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Revenue surged with strong organic growth
Third-quarter revenue was $6.423 billion, up $2.386 billion or 59.1% year over year, although down from $6.56 billion in Q2 2026. Core Operations revenue increased 7.3%, including 7.2% organic growth.
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Operating margin expanded
Operating income rose 87.1% to $991.7 million, and operating margin expanded to 15.4% from 13.1% year over year and 14.1% in Q2 2026. EBITA margin also increased to 17.3% from 13.7%.
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EPS improved despite integration costs
GAAP diluted EPS increased to $2.38 from $1.75 year over year and $2.08 in Q2 2026, a $0.63 or 36.0% year-over-year increase. Merger-related items reduced quarterly EPS by only $0.03 in 2026 versus $0.41 in 2025.
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Broad-based segment growth
All disciplines grew year over year, led by Public Relations at 84.5% constant-currency growth and Health at 81.5%. Integrated Media remained the largest discipline at $3,256.0 million, or 50.7% of revenue.
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Operating cash flow turned positive
Operating cash flow was $37.8 million for the first nine months, an improvement of $137.0 million year over year. Capital expenditures were $172.8 million, implying approximately negative $135.0 million of operating cash flow less capex before other cash-flow considerations.
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Restructuring benefits emerging
Management identified $106.8 million of net gains on business dispositions in the quarter and stated that real-estate repositioning charges are expected to result in lower costs in the future.
What to watch
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Leverage and interest expense increased
Net debt increased to $6.222 billion from $2.235 billion at December 31, 2025, while cash declined to $3.796 billion from $6.881 billion. Higher debt also increased quarterly interest expense to $132.8 million from $60.4 million.
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Working capital pressured liquidity
The first nine months used $2.3 billion for operating capital and total discretionary spending was $4.4 billion, while operating cash flow was only $37.8 million. Capital expenditures were $172.8 million and share repurchases were $3.165 billion.
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IPG integration remains costly
IPG integration remains a material execution risk: the quarter included $84.7 million of repositioning costs and $40.4 million of integration costs, while amortization increased by $98.6 million to $120.1 million.
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Covenant headroom remains relevant
The company states that no material changes occurred to the risk factors in the 2025 10-K. Nevertheless, the Credit Facility requires leverage of no more than 3.5 times, versus a reported 2.3 times at September 30, 2026.
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Goodwill valuation sensitivity
Goodwill impairment sensitivity remains a risk: the highest-risk reporting unit could withstand approximately a 37% decline in fair value before failing the impairment test, and the 2026 test used WACCs of 13.8% to 14.2%.
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Client concentration and cyclicality
Client spending and payment risk could worsen in an economic downturn. The 100 largest clients represented 52.7% of trailing twelve-month revenue, while the largest individual client represented 1.8%.
Management's outlook
No explicit quantitative revenue or EPS guidance was provided. Management expects foreign exchange rates to remain flat in the fourth quarter and positively affect full-year revenue by 1.0%; salary-related costs are expected to remain in line as a percentage of revenue year over year. Management believes operating cash flow and cash balances will be sufficient for non-discretionary requirements over the next twelve months.
Earlier filings 4
10-Q · April 29, 2026
Omnicom reported a strong Q1 2026 performance, achieving revenue of $6.24 billion and a diluted EPS of $1.90, both ahead of consensus expectations. This marks a 69.2% increase in revenue year-over-year, significantly…
10-K · February 20, 2026
Omnicom completed its transformational merger with IPG on November 26, 2025, creating a larger global holding company with legacy Omnicom shareholders owning approximately 60.6% and legacy IPG shareholders 39.4% (10-K).…
10-Q · October 22, 2025
Omnicom reported quarterly revenue of $4,037.1 million, up $154.5 million (+4.0%) versus the three months ended September 30, 2024, while operating income declined to $530.1 million (from $600.1 million) and diluted EPS…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.