By Megan Graham

Advertising holding company Omnicom reduced the lower end of its expected range for organic growth this year, saying it was unsure how or whether tariffs will impact marketer clients' spending.

Omnicom, which owns agencies such as BBDO, OMD and TBWA, said it now expects organic growth in 2025 to land between 2.5% and 4.5%. Earlier this year it had projected organic growth of 3.5% to 4.5%.

Executives said they wanted to be cautious, but haven't seen any specific instances of clients pulling back so far.

"As you're all keenly aware, there's been increased volatility in the economy and the markets," Omnicom Chief Executive John Wren said on the company's earnings call Tuesday. "We're assessing the implications of these events to determine how they will affect our clients and our business."

First-quarter revenue totaled $3.7 billion, an increase of 1.6% over the same period in 2024, and organic revenue grew 3.4%, Omnicom said.

Marketers still compete for market share even in periods of uncertainty by investing in their brands and trying to expand connections with their customers, Wren added.

President Trump's 90-day delay on his "reciprocal" tariffs "gives many of our clients the opportunity to buy more inventory at reasonable prices and...look to front-load sales in the first half of the year," Wren said. "The uncertainty really comes in later on in the year, in the third, fourth quarter, and hopefully we'll get more clarity as we continue."

Citi analysts said in a research note Monday that they expect U.S. ad spending this year will come in 6% below their pre-tariff estimates.

They also lowered their revenue forecast for Omnicom by 3%, citing the macroeconomic backdrop. But the analysts noted that they believe the top-line impact on Omnicom should be more muted for the company because roughly half of its revenue is generated outside the U.S.

Earlier Tuesday, Omnicom competitor Publicis Groupe confirmed its expectations for the year after its organic growth beat expectations in the quarter, saying new business wins would be able to make up for potential cuts to client spending due to tariff uncertainty.

"Many of our clients are facing a very challenging situation due to uncertainty on tariffs, rising inflation and a geopolitical context that is more volatile than ever," Publicis Chairman and Chief Executive Arthur Sadoun said on the company's earnings call. "This tough environment has not materialized in our numbers with March being the strongest month of the quarter. But like everyone else, we could experience cuts from several clients across many industries for the rest of the year."

Write to Megan Graham at megan.graham@wsj.com

(END) Dow Jones Newswires

April 15, 2025 19:52 ET (23:52 GMT)

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