Ipsos (IPS) Q2 2024 earnings summary

Executive summary

• Revenue for H1 2024 reached €1,139 million, up 4.7% year-over-year, with organic growth of 3.8%.

• Operating margin improved to 10.1% from 8.7% in the prior year; free cash flow rose to €80 million.

• Net income attributable to owners increased by 38.3% to €78 million; adjusted net income rose 17.5% to €82.3 million.

• Growth was driven by strong EMEA and digital/AI-based service offerings, with Ipsos Digital revenue up 37% and new services now 21.5% of total revenue.

• US market faced a 2.2% organic decline, offset by EMEA (+7.6%) and Asia-Pacific (+4.0%) growth.

Financial highlights

• Gross margin increased to 68.5% of revenue, up 80 bps year-over-year, supported by digital business and internalized data collection.

• Adjusted net profit group share up approximately 18%; reported net profit up 38.3% to €78 million.

• Free cash flow from operations was €80 million, up €56 million from last year.

• Cash position at period end was €283 million; liquidity of €500 million in undrawn credit lines.

• Net financial debt decreased to €100 million, with a leverage ratio of 0.3x EBITDA.

Outlook and guidance

• Organic growth for 2024 now expected to be close to last year’s level, around 3%, revised down from earlier expectations.

• Operating margin guidance maintained at 13% or above.

• Stabilization in the US anticipated in H2, with a return to growth expected in early 2025 as management changes take effect.

• Cautious outlook for China due to ongoing macroeconomic and competitive challenges.

• Strategic review for 2026–2030 underway (Horizon 2030).