Global advertising giant Omnicom Group (NYSE: OMC) met Wall Street’s revenue expectations in Q3 CY2025, with sales up 4% year on year to $4.04 billion. Its non-GAAP profit of $2.24 per share was 3.1% above analysts’ consensus estimates.

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"We expect to close the Interpublic acquisition next month, creating the world's leading marketing and sales company. Together, we will emerge with the industry's most talented team and a powerful platform designed to accelerate growth through strategic advantages in data, media, creativity, production, and technology," said John Wren, Chairman and Chief Executive Officer of Omnicom.

Company Overview

With a vast network of creative agencies that helped craft some of the most memorable ad campaigns in history, Omnicom Group (NYSE: OMC) is a strategic holding company that provides advertising, marketing, and communications services to many of the world's largest companies.

Revenue Growth

Examining a company’s long-term performance can provide clues about its quality. Any business can have short-term success, but a top-tier one grows for years.

With $16.07 billion in revenue over the past 12 months, Omnicom Group is a behemoth in the business services sector and benefits from economies of scale, giving it an edge in distribution. This also enables it to gain more leverage on its fixed costs than smaller competitors and the flexibility to offer lower prices. However, its scale is a double-edged sword because it’s challenging to maintain high growth rates when you’ve already captured a large portion of the addressable market. To accelerate sales, Omnicom Group likely needs to optimize its pricing or lean into new offerings and international expansion.

As you can see below, Omnicom Group grew its sales at a tepid 3.5% compounded annual growth rate over the last five years. This shows it failed to generate demand in any major way and is a rough starting point for our analysis.

We at StockStory place the most emphasis on long-term growth, but within business services, a half-decade historical view may miss recent innovations or disruptive industry trends. Omnicom Group’s annualized revenue growth of 5.3% over the last two years is above its five-year trend, suggesting some bright spots.

We can dig further into the company’s sales dynamics by analyzing its organic revenue, which strips out one-time events like acquisitions and currency fluctuations that don’t accurately reflect its fundamentals. Over the last two years, Omnicom Group’s organic revenue averaged 4.3% year-on-year growth. Because this number aligns with its two-year revenue growth, we can see the company’s core operations (not acquisitions and divestitures) drove most of its results.

This quarter, Omnicom Group grew its revenue by 4% year on year, and its $4.04 billion of revenue was in line with Wall Street’s estimates.

Looking ahead, sell-side analysts expect revenue to grow 24% over the next 12 months, an improvement versus the last two years. This projection is eye-popping for a company of its scale and indicates its newer products and services will catalyze better top-line performance.

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Operating Margin

Omnicom Group has been an efficient company over the last five years. It was one of the more profitable businesses in the business services sector, boasting an average operating margin of 14.4%.

Analyzing the trend in its profitability, Omnicom Group’s operating margin decreased by 2.3 percentage points over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability.

This quarter, Omnicom Group generated an operating margin profit margin of 13.1%, down 2.3 percentage points year on year. This contraction shows it was less efficient because its expenses grew faster than its revenue.

Earnings Per Share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

Omnicom Group’s EPS grew at a solid 10% compounded annual growth rate over the last five years, higher than its 3.5% annualized revenue growth. However, this alone doesn’t tell us much about its business quality because its operating margin didn’t improve.

We can take a deeper look into Omnicom Group’s earnings quality to better understand the drivers of its performance. A five-year view shows that Omnicom Group has repurchased its stock, shrinking its share count by 9.7%. This tells us its EPS outperformed its revenue not because of increased operational efficiency but financial engineering, as buybacks boost per share earnings.

Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.

For Omnicom Group, its two-year annual EPS growth of 7.1% was lower than its five-year trend. We hope its growth can accelerate in the future.

In Q3, Omnicom Group reported adjusted EPS of $2.24, up from $2.03 in the same quarter last year. This print beat analysts’ estimates by 3.1%. Over the next 12 months, Wall Street expects Omnicom Group’s full-year EPS of $8.40 to grow 7.6%.

Key Takeaways from Omnicom Group’s Q3 Results

It was good to see Omnicom Group beat analysts’ EPS expectations this quarter. On the other hand, organic revenue growth missed slightly, leading to in line reported revenue. Zooming out, we think this was a mixed quarter. The stock remained flat at $78.00 immediately following the results.

Is Omnicom Group an attractive investment opportunity at the current price? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here, it’s free for active Edge members.