Despite a revenue gain, Interpublic Group today reported a net loss for the first quarter of the year.
Historically, Q1 is a challenging quarter for the company, given that its revenue total is typically smaller than in other quarters and expenses remain consistent throughout the year, according to IPG.
In this year's first three months, the net loss totaled $45.9 million—a slight improvement from last year's Q1 net loss of $48.1 million.
The quarterly losses were much bigger in prior years. In the first quarters of 2010 and 2009, for example, the net losses totaled $71.5 million and $73.9 million, respectively.
Revenue in this year's first quarter grew 2 percent to $1.5 billion. On an organic basis, revenue climbed nearly 3 percent.
During an hour-long conference call with industry analysts, IPG CEO Michael Roth said the company remained on track to meet its year-end goals of improving its operating margin by 50 basis points and delivering 3 percent organic growth.
Significant losses in 2011, including S.C. Johnson's global business and Microsoft's North American media account, impacted the Q1 revenue total, according to Roth.
S.C. Johnson was among Draftfcb's largest accounts and supplied $50 million-$60 million in revenue to the shop. Sister shops Initiative, R/GA and Mullen also handled pieces of the business.
Universal McCann lost the Microsoft account to Publicis Groupe's Starcom MediaVest after a review.
Given such headwinds, Roth is pleased that the company still grew revenue organically, albeit at a lower rate than in Q1 2011, when organic revenue shot up 9 percent.
"We know that Q1 is our smallest revenue period seasonally," Roth said. "And, while the headwinds we are facing will be less pronounced in the second half of the year, we have consistently cautioned against putting too much weight on a single quarter's results."