Interpublic quadruples its profit, all thanks to Facebook
The Interpublic advertising group's quarterly profit has hit $208.1 million -- four times what what it was in the same period last year -- largely because the company's sold some of its shares in Facebook.
Interpublic group logo
The company sold about half its tiny stake - believed to be less then half of one-per-cent - in the social network in August. But that was enough to bring in $132.2 million before tax.
Interpublic paid less than $5m for the shares in 2006, when Facebook was valued at between $1bn and $2bn. The advertising giant won the right to invest then by committing to spend $10m for its clients on the social network at a time when Facebook wanted to beef up its image with advertisers.
Apart from the Facebook sale, Interpublic turned a strong performance, said Adweek. Operating income reached $173 million in the quarter, up 73% from the prior period.
Interpublic's agencies include McCann Worldgroup, DraftFCB and Mediabrands, About 60% of its revenue comes from North America.
Michael Roth, Interpublic chairman and CEO, told analysts said that despite Europe's problems and slow growth in the U.S. economy, Interpublic was sticking to its year-end targets of 4-5% organic revenue growth . He said. "We've seen little in the way of pullback from our clients."