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NEW YORK (AP) - Interpublic Group of Cos. on Thursday reported a 55.6 percent drop in third-quarter profit on continuing worldwide slumps in advertising.
Interpublic, one of the world's largest advertising and marketing conglomerates, earned $17.2 million, or 3 cents per share in the three-month period ending Sept. 30. In the same period last year the company earned $38.7 million, or 8 cents per share.
Revenue fell 18 percent to $1.43 billion from $1.74 billion.
Analysts predicted earnings per share of a penny, according to Thomson Reuters. They expected revenue of $1.42 billion.
U.S. revenue fell 13.5 percent to $834.1 million, while international revenue fell nearly 24 percent to $592.6 million. IPG said foreign currency translation hurt results by 3.9 percent. A strong U.S. dollar weighs on foreign sales because they translate back to fewer dollars.
Businesses have been decreasing their advertising amid the recession as they look to cut costs.
IPG, based in New York, has been cutting its own costs by trimming staff. IPG said it paid $23.4 million in severance costs in the quarter, up from $15.3 million last year. In the past 12 months, IPG has cut 5,100 jobs, or 11 percent of its work force, and spent $143.3 million in severance.
CEO Michael Roth said clients have become "more active of late" though he didn't want to predict what that would mean for next year.
"Client sentiment has stabilized, but remains cautious, which makes it difficult to predict what growth will look like in 2010," he said in a statement.
IPG shares rose 6 cents to $6.17 in trading just after the opening bell.
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