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Philip Angelastro

Thanks, John. We delivered solid results this quarter included organic revenue growth, growth in adjusted EBITA and growth in non-GAAP adjusted diluted EPS. We believe that the diversification of our portfolio of agencies across geographies, industries, and service offerings will help us in the uncertain environment ahead.
Let's begin with a brief overview of our earnings for the quarter on slide 3. Reported revenue grew 2%. Note, our total reported operating expenses include $33.8 million of IP-acquisition-related costs in the first quarter of 2025. At the bottom of this slide, the non-GAAP measures remove these IPG-acquisition-related costs from adjusted EBITA, which was also up 2%, and the related margin was flat with last year at 13.8%.
Now let's go into a more detailed review of our performance, beginning with changes in revenue on slide 4. Organic growth in the quarter was 3.4%. The impact on revenue from foreign currency translation decreased reported revenue by 1.6%, a bit less than our original expectation for the quarter of 2.0% to 2.5%.
In the current environment it is difficult to forecast the impact of FX rates on our future revenue for the rest of 2025. If rates stay where they were at quarter end, we estimate the impact of foreign currency translation on revenue will be negative 0.5% for Q2 2025, negative 1% for Q2 three, and flat in Q4, which would result in a negative 1% reduction for the full-year 2025.
The net impact of acquisitions and dispositions on reported revenue was negative 0.1%. At this time, we expect the impact of acquisitions and dispositions completed to date will be minimal for Q2 and for the full-year 2025.
Let's turn to slide 5 and review the quarterly organic revenue growth trends by discipline. First, however, I'd like to point out a change we made for 2025. In connection with the rollout of Omnicom production and Omnicom Advertising Group, we made some minor reclassifications of certain revenue related to changes in the agency groupings across our service-discipline categories. You can find a revised revenue by disciplined presentation with the reclassifications of historical 2024 and 2023 numbers in the Appendix on slides 21 and 22.
Turning to the quarter, Media and Advertising was up 7%, driven by strong growth in our Media businesses across our geographies and mixed performance across our Advertising agencies, which were down a bit. Precision Marketing grew 6%, driven primarily by strong performance in the U.S., partially offset by mixed performance in other the geographies.
Growth reflects strength from the benefits of new business wins in our CRM agencies that began late last year as well as continued good performance of Flywheel. Public Relations declined 5% due to certain client delays and reductions from certain government clients. As the year progresses, we expect benefits from public affairs activity in our specialty agencies, and we expect a difficult comp for the rest of 2025 related to the benefit in 2024 from US election-related spend.
Execution & Support grew 2%, driven by growth at our custom communications businesses, offset by declines at our merchandising business. Experiential declined 1%, driven by the Middle East and Asia Pacific, partially offset by strong growth in the US, Europe and the UK. We also expect a difficult comp in Q2 and Q3 related to the benefit in 2024 from Olympics-related spend.
Healthcare revenues were down 3% as expected, slightly better than a decline in Q4 as our Health Group manages through some delays in client-product launches and as a complete cycling out of client loss. We expect improved growth in the second half as the year progresses.
Branding & Retail Commerce was down 10%, with most of the decline in our branding business, which is due to uncertain market conditions impacting both new brand launches and rebranding projects, as well as the continued slowdown from M&A activity.
Turning to organic revenue growth by geography on slide 6, our largest market, the US, had organic growth of 5%, and Latin America grew a strong 15%. Europe experienced growth, but it was mix by market. And Asia Pacific also posted growth offset by declines in the UK and the Middle East and Africa.
As we look at the global trade uncertainty, we expect our geographic diversification to provide balance to our results. The US remains approximately half of our revenue, and it's worth noting that in fiscal year 2024, China was only 2% of our total revenue.
Slide 7 is our Revenue by Industry sector for the quarter. There were no notable changes to discuss.
Now let's move down the income statement and look at our expenses on slide 8. In the quarter, salary-related service cost were down on both a reported- and constant-dollar basis, driven by our continued efficiency initiatives and ongoing changes in our global employee mix.
Our Q1 2025 employee base is down from Q1 of 2024. Third-party service costs grew in connection with the growth in our revenue, primarily in the Media & Advertising discipline. Third-party incidental costs, which are out of pocket costs billed back to clients at our cost, also grew in connection with revenue growth.
Occupancy and other costs were flat. These include office rent, other occupancy, technology, and general office expenses. SG&A expenses increased due to the $33.8 million of IPG-acquisition-related costs in the first quarter of 2025. Excluding these costs, reported SG&A expenses declined by about 1%.
Please turn to slide 9 to look at our income statement in more detail. Excluding the acquisition-related costs from the first quarter of 2025, non-GAAP adjusted EBITA grew 1.6% and the related margin was flat at 13.8% compared to last year. Foreign exchange translation reduced EBITA by approximately 1.5%.
Moving down the income statement, net interest expense in the first quarter 2025 increased $2.6 million to $29.4 million. This increase is the result of having a full quarter of interest expense in Q1 2025 from the debt we issued in early March 2024 in connection with the Flywheel acquisition. The increase in expense was partially offset by an increase in interest income due to higher average cash balances.
Our income tax rate was 28.5% in Q1 of 2025, compared to 25.7% in the prior year. The increase is primarily due to the non-deductibility of certain acquisition-related costs in 2025. Excluding the tax impact on these costs, our Q1 2025 rate was up a bit from Q1 2024 at 26.7%. For full-year '25, we expect the rate to be between 26.5% and 27%.
Average diluted shares outstanding were down 1% from Q1 of 2024, due primarily to repurchase activity last year. Reported diluted earnings per share was down 8.8%, due to the after-tax acquisition-related costs. On an adjusted basis, diluted earnings per share increased 2% to $1.70. The effects of foreign currency translation reduced diluted EPS by $0.02.
Now please turn to slide 10 for a look at free cash flow for the first quarter. The year-over-year decline in the quarter was driven primarily by a reduction in net income, which includes the impact of the acquisition related costs.
However, for the 12-months ending March 31, 2025, our free cash flow increased 3.5%, driven primarily by improved operating income and net income. Our free cash flow definition excludes changes in working capital. Our working capital followed its normal seasonal pattern in the first quarter and over time, we expect to trend back towards our historical annual level that is close to neutral.
Regarding our primary uses of free cash flow for the three months ended March 31, we used $138 million of cash to pay for dividends to common shareholders and another $13 million for dividends to noncontrolling interest shareholders.
Our capital expenditures were $30 million. As expected, the spend was a bit higher this period, reflecting ongoing investments on our strategic technology platform initiatives. Total acquisition payments, which include earn-out payments and the acquisition of additional non-controlling interests, were $4 million. As a reminder, in the first quarter of last year, we closed on the acquisition of Flywheel for $845 million net of cash acquired.
Finally, our share repurchase activity was $81 million, excluding proceeds from stock plans of $12 million. For full-year 2025, we still expect to return to an annual or purchase level of approximately $600 million and we resumed our activities subs sequence of the successful March 18 stockholder vote on the IPG acquisition.
Slide 11 is a summary of our credit liquidity and debt maturities. At the end of Q1 2025, the book value of outstanding debt was $6.1 billion, flat with the same prior year period. We have no maturities in 2025 and expect to address our April 2026 maturities after the expected closing of the IPG acquisition in the second half of 2025. We estimate that net interest expense will increase by $2 million to $5 million in Q2 compared to Q2 2024. And by $15 million to $20 million for the full year related to lower estimates of interest income in the second half.
Our cash equivalents and short-term investments at the end of the quarter were $3.4 billion. We continue to maintain an undrawn $2.5 billion revolving credit facility, which backstops our $2 billion U.S. commercial paper program. We will assess our revolver capacity in connection with the closing of the proposed IPG acquisition.
Slide 12 presents our historical returns on two important performance metrics for the 12 months ended March 31, 2025. Omnicom's return on invested capital was 20%, return on equity was 37%, both of which reflect our strong performance that strong balance sheet. The year-over-year change is driven by the IPG-acquisition-related costs occurred in the 12 months ended March 31, 2025.
I will now ask the operator, please open the lines up for questions and answers. Thank you.

Question and Answer Session

Operator

(Operator Instructions)
Adam Berlin, UBS.

Adam Berlin

Hi, good evening and thank you for taking the question. Can you just tell a bit more about your decision to lower the books and end of the guidance range for 2025 to 2.5%? Is that because you've actually seen some advertisers start to talk to you about cutting their spend? Or is that just something you're just could happen based on what you're hearing about the broader macro? That will be quite helpful.
And any trends about how Q2 has started in the first couple of weeks would be very helpful as well. Thanks.

John Wren

Sure. Adam, it's the latter. We're being conservative in lowering the bottom end. And you have to look at our business in this type of environment. Our Advertising, Media and CRM businesses remain strong. We didn't change the forecast on those.
Where, if we had doubts, it was really more in the events business as companies probably get a little bit more conservative. And we're up against -- one, because of, as Phil mentioned, the Olympics. There might be fewer projects. And also, in the latter part of the year [this] business, annual guidance, we had the elections last year, which we don't have again this year.
So that's the sense of the business in terms of how we looked at it to be conservative. We're striving to get to the top end always. And there's still some confusion, because there's still confusion in the marketplace as we look at especially the next 90 days and how some of these tariffs and other moves get negotiated or do they stay in place. So it's that uncertainty where we didn't want to surprise anybody later in the year that we chose to be conservative.

Philip Angelastro

Yes, it does -- and it doesn't, as John said, reflect any specific client actions taken to date.

Adam Berlin

Okay. Thank you very much.

Operator

David Karnovsky, JPMorgan.

David Karnovsky

Hey, thanks. Just kind of going back at something Phil have said. It's anabolic for PR, there were some delays in government spend? I don't know if you could dig into that debate; is that for the US or other regions? And then for Branding and Commerce, this is an area that was already lagging last year. Curious how much of the delays you're seeing there is new.
And then, specifically for Phil, just as you consider the uncertainty and possibility of clients adjusting their spend, how are you thinking about your own cost base and what's your confidence and holding margin in some of the more adverse scenarios you might sit?

John Wren

Probably the first part of your question to Phil I encountered. We are constantly, and I think we have a very solid track record in this in looking at our business and adjusting -- we have a very flexible cost basis. Adjusting our cost basis so as do stay in line with whatever the revenue trends are. And God knows never tested the same twice, but we've been tested quite a bit over the years.
And if you look back across that, we have a very, very competent management label of the corporate management looking and concerning themselves with that all the time. So that will be one answer.
One PR event was somebody in the US, it was --was that FDA [review]?

Philip Angelastro

Yes, there was some, I would say, not a large trend that we're concerned about going forward. But that is just a minor year-over-year comparison difference in terms of project spend that didn't happen in Q1 that was there the year before in the PR business. I think you're not going to see the impact of the year-over-year comps related to election spend until probably a little bit in Q2. And then PR was especially strong in that area in Q3 and Q4. So we do have a difficult comp in Q3 and Q4.
To your specific question on the cost base and margins, John just referred to this, but certainly we are always very focused on making sure we take the appropriate actions to rationalize and adjust the flexible cost base that we have to our current expected revenues.
And to the extent that there is a pause or clients decide to delay project spend or delay spend in some way, depending on how some of this tariff uncertainty gets resolved. We're going to be very active in making sure we take the appropriate actions as opposed to kind of keep our fingers crossed and hope that the best scenarios are the ones that come forward.
So we're certainly going to be planning very carefully and aggressively if need be, to make sure that we're not out ahead of it from a cost-base perspective. So we're comfortable, certainly based on everything we know today, that will hit our expectations as far as operating earnings and our margin targets. But there is still quite a bit of uncertainty out there as far as tariffs and what's going to happen to the top line.
But we haven't we haven't seen any specific actions by clients that that happened yet. We're being cautious, as we mentioned earlier in answer to Adam's question.

John Wren

One other little tidbit because this is early in the cycle, a lot of our larger funds don't come out with quarterly reports until later in the month, which will all learn a little bit more. But with the sense of delay of 90 days in the tariffs, I think it gives many of our clients the opportunity to acquire more inventory at reasonable prices and tend to front-load or look to front load sales in the first half of the year.
The uncertainty really comes in later on in the year, third, fourth quarter. And hopefully, that will get -- we'll get more clarity as we as we continue.

David Karnovsky

Sorry, to be clear, I think you said you haven't seen clients take action on what the gap, but I thought with branding, for instance, you had mentioned some (multiple speakers)

John Wren

Branding's a category, but it's such a small category within the overall Omnicom. It's really three very, very well-known boutiques who are the leaders in branding. And when they tend to prosper in years where there's a lot of M&A going on. And a lot of changes that people, corporations who are considering maybe changing, rebranding their corporations of or getting swept up in a merger. And in periods like this, where there's been a pause in a lot of that activity, naturally, we fully expect that revenue is going to be off a bit but it's --

Philip Angelastro

Yeah, in total it's (inaudible) 2% or less than 2% of our total revenues. And it's had challenges all throughout 2024, pretty much similar reasons as to what I indicated in my prepared remarks. We, unfortunately, see that continuing through the first two, if not three quarters of this year, as it kind of rights itself and continues to pursue new opportunities. That's unique business that's managing through some unique challenges in its industry right now, specifically.

John Wren

And not to beat this to death, but I started off by saying Advertising, Media and CRM remains strong. Also in those categories specifically, there's some very positive potential new business that we're not really defending, but we're on the offense. And if we continue to win our fair share, that will contribute to us getting closer to the top end of our forecast.

David Karnovsky

Helpful. Thank you.

Operator

Jason Bazinet, Citi.

Jason Bazinet

I know everyone is so focused on the on the macro in '25, but I would just like to ask a question about 2026, actually.

John Wren

Sure.

Jason Bazinet

Let's assume that the IPG transaction closes. When do you think the street will have evidence or you have evidence that the market has embraced the notion that the pro forma firm will be in a better position to win business as opposed to bearish argument, which is you might lose some accounts because of the transaction. Is that something that will become evident do you think in '26? Or do you think it really, we won't really see it in the organic numbers until '27 or beyond?

John Wren

My personal opinion specific to that question, we have not had any client of any significance that we're in fear of losing because of the transaction. And, especially, in environments like this, I doubt that many --there's always going to be some every single year. But if you're running a company right now, unless you're going to get some great efficiency by putting your advertising and marketing into review, you're not going to proactively to shore up your own organization.
So I think, and I'm not sure I know Jason, but I think what you're asking a question about is certainly a valid question, but that's just nonsense fed by my competitors to the trade rags, right, that I'm going to lose people and I'm going to lose accounts, and I'm going to lose this that moving, not true.

Philip Angelastro

Yes, just to add, it's very disruptive for the client to make a change and especially in this environment. There would have to be some underlying strategic reasons why they would go ahead and do that beyond the ones that had started that process already.

John Wren

And I think I think that's also part of your question, Jason. We can go back on will have a much clearer side on the synergies we promised today. And we continue to have many work streams where we're actively planning to achieve those synergies.

Jason Bazinet

Understood. Thank you both.

John Wren

Thank you.

Operator

Cameron McVeigh, Morgan Stanley.

Cameron McVeigh

Hey, John, Phil. Wanted to ask if you're able to provide the Precision Marketing growth ex Flywheel. Secondly, curious of any update to the regulatory review of the IPG deal timing of integration, potential client conflicts that may have arisen? Thanks.

Philip Angelastro

I'll take the Precision question. In the first quarter, I would say, Flywheel grew its smallest quarter is always the first quarter growth was fine, but it was lower than the average in the overall category. And the rest of the CRM Precision Group probably grew faster than the average in the category.

John Wren

And today, another 18 requests from governments, regulators for approval, we received five. Actually the most recent one we got just a couple of days ago was China. And you know, I don't recall or remember this, but 10 or 11 years ago when we were trying to new publicist, the place that we had trouble getting approval was China and we've already received that and it's processed already. So we have very confident advisors and attorneys who are guiding us through that process as we speak.

Cameron McVeigh

Great. Thanks.

Operator

Steven Cahall, Wells Fargo.

Steven Cahall

Thank you. John, I was wondering if you could spend a little time talking specifically about trends in Pharma and Health. I think that's your biggest industry vertical and Healthcare has its own discipline within the revenues. So just wondering if you see this area is having less risk on some of these concerns in the rest of the portfolio or a little more risk on now that we're doing some of the extra uncertainty in 2025.
Then also, I just wanted to dig a little more in the Media and Advertising or even a number of quarters where your third-party expense growth remained solidly in the teens. I'm guessing Media continues to grow really well. Is Creative also growing really helpfully within that? I sense from some peers that it might be under a little bit pressure.
So just wanted to know if you're seeing any pressure on creative or it's still really solid, just not as good as Media giving a lot of the account like. Thank you.

John Wren

So first, Healthcare. Healthcare is I think the decline or what you saw in the first quarter was us just working through the loss of Pfizer and one or two other minor accounts. And we're phasing through that as we get into the beginning of 2025. It is still a very strong business. I mean our businesses in Healthcare go although -- are dedicated in different aspects of creating a drug, bringing drugs to market, getting the appropriate approvals from the stronger regulatory bodies around the world, which principally the US, also Germany is very strong too in terms of procedures.
What is not a big part of our business is some stuff you'll see in the six o'clock news like biosensor, again is a mom and dad, and a cat. And some of these lose weight because in diabetes. That's not a very large part of that segment first. It's more specific, very high science. The employees that we have in those categories are extremely well-educated and very specifically educated in terms of medicine.
So I see it as over -- as I look forward, I see Healthcare as being a very important segment in what we do. And I apologize you have some other part of the question, do you mind --

Steven Cahall

Sure, the second part was just within Media and Advertising sort of comparing and contrasting the strong growth. I think that's implied in Media with how you're seeing the trends in creative.

John Wren

Sure. Media by far is very strong and continues to be very strong and last year, I think we topped the leagues in terms of new business wins and retentions. And matter of fact, if you netted some of IPG losses against our wins, we'd still be number one from last year and that continues.
Advertising? Advertising will need some be separated into two different areas. Both are being very highly affected by technology, but Creative is our IP. That's all it is going to be at the center of what Omnicom does, and it's terribly important to our clients into the creation of differentiation, especially as these tools become more democratic.
Everybody had the same generative AI tools on their desk, what would make a difference? What would make a difference would be a brand-creative idea. So now is that business going through some adjustments because technology has created efficiencies within that business, which allow us to have less effort in some instances. Yes, no question. But it remains a very key part of our organization.
If I look back at '24, we probably will be makes up something closer to 17% or 18% of our total business that balance may increase a bit as we complete the transaction IPG. But it's still the core of what we do, as I said, the IP. In the business, --

Philip Angelastro

In terms of the other component production is certainly a fast-growing component of the solutions we provide to clients. And there's more and more activity in that area and opportunity in that area, especially as you look at our data from the content automation platform, which has been quite successful recently.
So yes, overall, Creative has grown low-single digits last year. The first part of this year, we expect that to be close to flat, little bit down in the first quarter, and we expect that to pick up in the second half. And as John said, yes, Media has been quite strong. We expect that to continue to be very strong and together, those are two key components of the overall product mix that is very key and very strategic to the business going forward.

Steven Cahall

Great. Thank you.

Philip Angelastro

Sure.

Operator

Michael Nathanson, MoffettNathanson.

MIchael Nathanson

Thanks. One for John, one for Phil. Hey, John, you touched on it earlier that you guys feeling good about the new business potential. You talked a bit about the volume of new business pitches. Is it normal or do you think people are kind of holding back in terms of the scale of volume until maybe the uncertainties lifted?
And then on that point, how do people with the fact that you will you be merging of Interpublic, right? So is that part of the conversation and people are asking you about the future prospects of Omnicom Media? Anything you're talking about there would be helpful.
And then for Phil, third-party service cost, store print in terms of costs were up double digits this year. We think about your guidance on organic revenue for the year. Is it normal to expect this type of growth and third-party costs, or is there anything unusual about the first quarter of this year and third party? Thanks.

John Wren

Um, you know, in the first part of your question, the new business reviews, I have to admit I haven't tried to track them year over year. I do expect that unless a client has some proactive reason to put their account review, I'm excited to not be as robust as it was say last year.
But having said that in the first quarter, you know, there are clients who are thankfully, we're on the offense, not defense where their accounts are currently being reviewed and I won't use their names those than that and sell them. And you know, you had the move which benefited publicist of the [Coke] business earlier in the quarter.
So there are things going on. There is a lot of conversations going on. But I can tell you, though, is 10% up 10% down from this exact moment last year. In terms of what goes on in terms of IPG and the acquisition, we are extremely cautious because there are very strict rules in terms of what we can do.
We can collectively, but each plan for when the transaction has improved, but we're not able to go to market anyway. And so we don't, that's just us behaving in accordance with us on what's expected of us in this kind of a process.

Philip Angelastro

On the on the specific question, Michael, that third-party service cost growth, certainly I'm happy to get the growth wherever we can get it. The reason we have that business and the reason it's growing is because clients want it and it provides valuable benefits to the clients. Ultimately, it didn't provide benefits and it wasn't a key part of what clients' expectations were. You wouldn't see the results that we've seen in it.
We don't think our numbers, frankly, are any different than our competitors. That business is growing throughout the industry. Again, because clients from like the benefits of that particular service offering, you just can't see it come outside of our reported results.

MIchael Nathanson

Right. Okay. Thanks, Phil.

Philip Angelastro

Sure.

Operator

Craig Huber, Huber Research Partners.

Craig Huber

Thank you. My first set of questions has to do with the potential closing the acquisition. I think you mentioned 5 of the 18 jurisdictions have approved the transaction, including China. Can you share with us if it's possible at the other four are?
And then also wanted to ask, John, I think what you originally brought forth to talk publicly about this acquisition of Interpublic. You talked about if you run into any issues with any of the regulators out there that you would be open to potentially selling of divesting any related assets in various jurisdictions. Is that still your case here?

John Wren

Well, I'll probably answer it differently in that we are 100 unless you are higher in percentage is committed to the completion of the transaction. I think that various regulators have requested information from us because they are trying to understand our business before some of them are approved.
I'm sitting here today based on very competent advice from our attorneys and I would go as say I haven't heard anything from our very competent attorneys that IPG has either that we expect that were in violation of any antitrust rules.
And moving across all being here in America are going to do is look at Google results, Meta results and in terms of who we really competing against and where consumers are spending money. We're a very strong player, but they are extreme really strong. So I would think and I'm not knowledgeable enough with the rules as the lawyers will continue to point out to me every day when I ask a question on and I think I know the answer, I don't know.
I don't think this merger drives us into a position in almost any market around the world where we would have difficulty after we go through whatever their required processes. But if there was the odd thing or two, and it would be small on if it even existed, would we it wouldn't change our view that we will close this transaction and we are dedicated to closing this transaction.
But there's nothing material, otherwise, there's certainly enough legal firms working on this globally, locally to have highlighted anything would be in that category, which would drive the gross level being a concern. And we haven't had them.

Craig Huber

And maybe touch on just what the other four jurisdictions are approved it so far.

Philip Angelastro

Yes, I can list them for you, Jason, sorry, Craig, I'm sorry about that. So in addition to China, there's Colombia, Brazil, Saudi Arabia, and Egypt. You know they are a relatively small for our combined businesses, but certainly is progress and we've tried not to issue a press release every time we yet on approval, but certainly it's good progress so far.
But the process has been quite thorough in all the markets that set of the work to review the transaction, and we wouldn't expect anything else.

Craig Huber

And then my last question, guys, is can you just talk a little bit further about the tone of business, what you did from executives out there in two areas, specifically autos and consumer packaged-goods areas. Just given this issue of tariffs and certainty out there and so forth. What is the tone that you're hearing from what your companies we work with in those areas placed. Has it materially changed for the negative is what I'm trying to get to.

John Wren

Well with respect to tariffs, I think that's still an open question because I think the tariffs or the potential for tariffs that the administration has spoken to, they've -- several very specific markets, they made it clear that they are in conversations with many of those governments to resolve any issues that the tariffs may bring to the fore.
And I am not any more knowledgeable than you, but it's kind of confirming that the pause that we're in, it was probably driven because some people approaching administration with things that are of interest to them. But again, I don't have any firsthand knowledge of that, but it's all the all bodes better than had they just simply gone into effect.
So we were planning for our glass that could be half empty, but we're constantly striving for what we really believe and have believed for a long time, our optimism that it will wind up half full. But certainly those --
Yes, I'm sorry. Go ahead.

Craig Huber

Are you trying to suggest and you're not quite sure what the spending levels or the auto companies out there and CPG, for example, how they may or may not adjust that it's just too early to tell.

John Wren

We believe that -- I don't think we know it's certainty, right? We haven't heard any disasters or had any disasters report specifically from clients. We've taken advice from very knowledgeable people in, specifically, in the auto industry, not related to the advertising business in terms of what they believe car companies globally are expecting.
And again, that leaves us in a position where these are terribly important long-term clients where we have multiyear contracts with in almost every single case of a car company which gives us some comfort and as a good partner because they have difficulty will work with them as best we can to help us all get through whatever the processes.
So the good news is there's none of those accounts are under threat because of the multiyear contracts. And yes, as good partners, we will work with our partners to get to a good outcome. In terms of CPG, I haven't really haven't dug in as deeply into CPG because I have say into the auto sector and kind of a wait some of their quarterly reports as they come out through the rest of this market to find out if there's more specific information, which would require us to adjust ourselves on.
Finally, on that point, unlike our competitors, CPG is not a huge percentage of our business. So whatever adjustments need to be made will in fact get made. I'd even go as far as to say, CPG companies are probably taking the lead on in housing things, and they're going to find themselves in a very uncomfortable position if they have to adjust how they do a deal would add a third-party vendor where it would be easier to get concessions from.
But that's all speculation. So no, it doesn't for anything. I think we're going to all learn a lot more in the next two, three weeks.

Philip Angelastro

Yes, certainly clients across industries are yes, they're looking for more clarity. They want flexibility at this point in time but the looking for clarity and ultimately, they need defend and grow their brands. So the type of marketing spend may change, but we've got a diverse portfolio. We can help them in many different ways.
And yes, I think this is going to lose, it's going to evolve and we're going to know more in the near future and we'll adjust accordingly. And I think we have a track record that shows that we can and will adjust depending on what the market brings.

Craig Huber

Great. Thank you both.

John Wren

Thank you.

Philip Angelastro

Thank you.

Operator

There are no further questions at this time. Concludes today's conference call. Thank you for joining. You may now disconnect.