UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q



	x☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
~~For the quarterly period ended September 30, 2017~~

orFor the quarterly period ended September 30, 2023



			o☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 1-6686

THEINTERPUBLIC GROUP OF COMPANIES, INC.

(Exact name of registrant as specified in its charter)



Delaware						13-1024020
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

909 Third Avenue, New York, New York 10022

(Address of principal executive offices) (Zip Code)

(212)704-1200

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.10 per share	IPG	The New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No ¨

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). Yes ý No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large ~~accelerated filer~~Accelerated Filer

ý☒

Accelerated ~~filer~~Filer

¨☐

Non-accelerated ~~filer~~Filer

¨☐

Smaller ~~reporting company~~Reporting Company

¨☐

~~(Do not check if a smaller reporting company)~~

Emerging ~~growth company~~Growth Company

¨☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨☐ No ý

The number of shares of the registrant’s common stock outstanding as of October ~~16, 2017~~18, 2023 was ~~388,608,593.~~

383,004,131.

INDEX

~~INDEX~~

		Page
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	2
	Consolidated Statements of Operations for the Three and Nine Months Ended September 30, ~~2017~~2023 and ~~2016~~2022	23
	Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, ~~2017~~2023 and ~~2016~~2022	34
	Consolidated Balance Sheets as of September 30, ~~2017~~2023 and December 31, ~~2016~~2022	45
	Consolidated Statements of Cash Flows for the Nine Months Ended September 30, ~~2017~~2023 and ~~2016~~2022	56
	Consolidated Statements of Stockholders’ Equity for the Three and Nine Months Ended September 30, ~~2017~~2023 and ~~2016~~2022	67
	Notes to Consolidated Financial Statements	89
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2028
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	3346
Item 4.	Controls and Procedures	3346

PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	3447
Item 1A.	Risk Factors	3447
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	3447

Item 3.	Defaults Upon Senior Securities	47
Item 4.	Mine Safety Disclosures	47
Item 5.	Other Information	3447
Item 6.	Exhibits	3547
INDEX TO EXHIBITS		3648
SIGNATURES		3749

INFORMATION REGARDING FORWARD-LOOKING DISCLOSURE

This quarterly report on Form 10-Q contains forward-looking statements. Statements in this report that are not historical facts, including statements ~~about management’s beliefs~~regarding goals, intentions, and expectations as to future plans, trends, events, or future results of operations or financial position, constitute forward-looking statements. Without limiting the generality of the foregoing, words such as “may,” “will,” “expect,” “believe,” “anticipate,” “estimate,” “project,” “forecast,” “plan,” “intend,” “could,” “would,” “should,” “estimate,” ~~“continue”~~“will likely result” or comparable terminology are intended to identify forward-looking statements. ~~These~~Forward-looking statements are based on current ~~plans, estimates~~expectations and ~~projections, and~~assumptions that are subject to ~~change based on a number of factors, including those outlined under Item 1A,~~ ~~Risk Factors~~, in our most recent annual report on Form 10-K. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly any of them in light of new information or future events.

~~Forward-looking statements involve inherent~~ risks and ~~uncertainties. A number of important factors~~uncertainties, which could cause our actual results and outcomes to differ materially from those ~~contained~~reflected in ~~any~~the forward-looking ~~statement. Such factors include, but are not limited to, the following:~~statements.

~~potential~~

Actual results and outcomes could differ materially for a variety of reasons, including, among others:

•the effects of a challenging economy ~~for example,~~ on the demand for our advertising and marketing services, on our clients’ financial condition and on our business or financial condition;

•our ability to attract new clients and retain existing clients;

•our ability to retain and attract key employees;

•the impacts of the COVID-19 pandemic, including potential developments like the emergence of more transmissible or virulent coronavirus variants, and associated mitigation measures, such as restrictions on businesses, social activities and travel, on the economy, our clients and demand for our services;

•risks associated with the effects of global, national and regional economic and political conditions, including counterparty risks and fluctuations in interest rates, inflation rates and currency exchange rates;

•the economic or business impact of military or political conflict in key markets;

•risks associated with assumptions we make in connection with our critical accounting estimates, including changes in assumptions associated with any effects of a ~~weakened~~challenging economy;

•potential adverse effects if we are required to recognize impairment charges or other adverse accounting-related developments;

risks associated with the effects of global, national and regional economic and political conditions, including counterparty risks and fluctuations in economic growth rates, interest rates and currency exchange rates; and

•developments from changes in the regulatory and legal environment for advertising and marketing ~~and communications~~ services companies around the ~~world.~~world, including laws and regulations related to data protection and consumer privacy; and

•the impact on our operations of general or directed cybersecurity events.

Investors should carefully consider ~~these~~the foregoing factors and the ~~additional risk factors~~other risks and uncertainties that may affect our business, including those outlined ~~in more detail~~ under Item 1A, Risk Factors, in our most recent annual report on Form ~~10-K.~~10-K and our quarterly reports on Form 10-Q. Investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date they are made. We undertake no obligation to update or revise publicly any of them in light of new information, future events, or otherwise.

Table of Contents

PART I – FINANCIAL INFORMATION



Item 1.			Financial Statements (Unaudited)

THE INTERPUBLIC GROUP OF COMPANIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)


	Three months ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022
REVENUE:
Revenue before billable expenses	$	2,309.0	$	2,296.2	$	6,814.4	$	6,898.9
Billable expenses	369.5		341.5		1,051.6		1,043.0
Total revenue	2,678.5		2,637.7		7,866.0		7,941.9

OPERATING EXPENSES:
Salaries and related expenses	1,531.1		1,546.8		4,707.0		4,701.4
Office and other direct expenses	318.8		327.9		989.6		1,001.1
Billable expenses	369.5		341.5		1,051.6		1,043.0
Cost of services	2,219.4		2,216.2		6,748.2		6,745.5
Selling, general and administrative expenses	16.9		18.5		43.7		57.2
Depreciation and amortization	66.0		67.0		199.0		201.9
Restructuring charges	(0.6)		(5.8)		(0.7)		0.7
Total operating expenses	2,301.7		2,295.9		6,990.2		7,005.3

OPERATING INCOME	376.8		341.8		875.8		936.6

EXPENSES AND OTHER INCOME:
Interest expense	(58.7)		(42.6)		(164.2)		(121.2)
Interest income	35.1		14.7		97.3		33.9
Other (expense) income, net	(13.7)		17.5		(24.8)		6.8
Total (expenses) and other income	(37.3)		(10.4)		(91.7)		(80.5)

INCOME BEFORE INCOME TAXES	339.5		331.4		784.1		856.1
Provision for income taxes	91.5		76.4		135.9		209.2
INCOME OF CONSOLIDATED COMPANIES	248.0		255.0		648.2		646.9
Equity in net (loss) income of unconsolidated affiliates	(2.3)		2.5		(1.7)		3.3
NET INCOME	245.7		257.5		646.5		650.2
Net income attributable to non-controlling interests	(2.0)		(5.7)		(11.3)		(9.4)
NET INCOME AVAILABLE TO IPG COMMON STOCKHOLDERS	$	243.7	$	251.8	$	635.2	$	640.8

Earnings per share available to IPG common stockholders:
Basic	$	0.64	$	0.64	$	1.65	$	1.63
Diluted	$	0.63	$	0.64	$	1.64	$	1.62

Weighted-average number of common shares outstanding:
Basic	383.6		390.6		385.0		392.7
Diluted	385.5		394.1		386.8		396.2

Three months ended
September 30, Nine months ended
September 30,
2017 2016 2017 2016
REVENUE $ 1,902.6
$ 1,922.2
$ 5,541.4
$ 5,582.1

OPERATING EXPENSES:
Salaries and related expenses 1,227.6
1,228.0
3,742.3
3,726.3
Office and general expenses 455.9
486.2
1,343.8
1,400.5
Total operating expenses 1,683.5
1,714.2
5,086.1
5,126.8

OPERATING INCOME 219.1
208.0
455.3
455.3

EXPENSES AND OTHER INCOME:
Interest expense (21.0 ) (21.7 ) (67.6 ) (68.8 )
Interest income 4.1
4.7
14.0
16.1
Other (expense) income, net (9.9 ) 5.3
(24.5 ) (13.5 )
Total (expenses) and other income (26.8 ) (11.7 ) (78.1 ) (66.2 )

Income before income taxes 192.3
196.3
377.2
389.1
Provision for income taxes 42.5
63.8
115.8
91.9
Income of consolidated companies 149.8
132.5
261.4
297.2
Equity in net (loss) income of unconsolidated affiliates (1.0 ) 0.2
0.1
(1.6 )
NET INCOME 148.8
132.7
261.5
295.6
Net (income) loss attributable to noncontrolling interests (2.6 ) (4.1 ) 0.9
(4.7 )
NET INCOME AVAILABLE TO IPG COMMON STOCKHOLDERS $ 146.2
$ 128.6
$ 262.4
$ 290.9

Earnings per share available to IPG common stockholders:
Basic $ 0.38
$ 0.32
$ 0.67
$ 0.73
Diluted $ 0.37
$ 0.32
$ 0.66
$ 0.71

Weighted-average number of common shares outstanding:
Basic 389.5
397.7
391.2
399.5
Diluted 397.2
407.9
398.6
408.8

Dividends declared per common share $ 0.18
$ 0.15
$ 0.54
$ 0.45

The accompanying notes are an integral part of these unaudited financial statements.

Table of Contents

THE INTERPUBLIC GROUP OF COMPANIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Amounts in Millions)

(Unaudited)


	Three months ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022
NET INCOME	$	245.7	$	257.5	$	646.5	$	650.2

OTHER COMPREHENSIVE LOSS
Foreign currency translation:
Foreign currency translation adjustments	(60.6)		(117.7)		(29.1)		(230.2)
Reclassification adjustments recognized in net income	0.0		(1.3)		0.5		0.5
	(60.6)		(119.0)		(28.6)		(229.7)

Derivative instruments:
Changes in fair value of derivative instruments	0.0		5.2		0.6		17.8
Recognition of previously unrealized net gain in net income	(1.1)		(0.4)		(1.7)		(1.1)
Income tax effect	0.3		(1.2)		0.3		(4.2)
	(0.8)		3.6		(0.8)		12.5
Defined benefit pension and other postretirement plans:
Net actuarial gain for the period	0.0		0.0		2.7		3.4
Amortization of unrecognized losses, transition obligation and prior service cost included in net income	1.8		1.5		5.2		4.8

Other	(0.1)		(0.2)		0.3		(0.2)
Income tax effect	(0.4)		(0.3)		(1.4)		(0.9)
	1.3		1.0		6.8		7.1
Other comprehensive loss, net of tax	(60.1)		(114.4)		(22.6)		(210.1)
TOTAL COMPREHENSIVE INCOME	185.6		143.1		623.9		440.1
Less: comprehensive income attributable to non-controlling interests	1.7		5.0		10.8		7.7
COMPREHENSIVE INCOME ATTRIBUTABLE TO IPG	$	183.9	$	138.1	$	613.1	$	432.4

Three months ended
September 30, Nine months ended
September 30,
2017 2016 2017 2016
NET INCOME $ 148.8
$ 132.7
$ 261.5
$ 295.6

OTHER COMPREHENSIVE INCOME (LOSS)
Foreign currency translation:
Foreign currency translation adjustments 29.2
4.4
114.0
43.5
Reclassification adjustments recognized in net income 1.5
(4.2 ) 1.8
2.3
30.7
0.2
115.8
45.8

Available-for-sale securities:
Changes in fair value of available-for-sale securities (0.1 ) 0.2
0.0
0.4
Recognition of previously unrealized gains in net income (0.7 ) (0.1 ) (0.7 ) (1.3 )
Income tax effect 0.1
0.1
0.1
0.1
(0.7 ) 0.2
(0.6 ) (0.8 )

Derivative instruments:
Recognition of previously unrealized losses in net income 0.5
0.5
1.6
1.5
Income tax effect (0.2 ) (0.2 ) (0.6 ) (0.6 )
0.3
0.3
1.0
0.9

Defined benefit pension and other postretirement plans:
Net actuarial gains (losses) for the period 8.2
(79.2 ) 9.0
(78.4 )
Amortization of unrecognized losses, transition obligation and prior service cost included in net income 1.7
1.2
5.2
3.7
Settlement and curtailment losses included in net income 4.0
0.1
4.0
0.3
Other 0.0
0.0
(0.6 ) 0.0
Income tax effect (2.8 ) 13.0
(3.4 ) 12.5
11.1
(64.9 ) 14.2
(61.9 )

Other comprehensive income (loss), net of tax 41.4
(64.2 ) 130.4
(16.0 )
TOTAL COMPREHENSIVE INCOME 190.2
68.5
391.9
279.6
Less: comprehensive income (loss) attributable to noncontrolling interests 2.5
5.4
(0.3 ) 5.9
COMPREHENSIVE INCOME ATTRIBUTABLE TO IPG $ 187.7
$ 63.1
$ 392.2
$ 273.7

The accompanying notes are an integral part of these unaudited financial statements.

Table of Contents

THE INTERPUBLIC GROUP OF COMPANIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Amounts in Millions)

(Unaudited)


	September 30, 2017			December 31, 2016				September 30, 2023		December 31, 2022
ASSETS:							ASSETS:
Cash and cash equivalents	$	704.9		$	1,097.6		Cash and cash equivalents	$	1,574.9	$	2,545.3
Accounts receivable, net of allowance of $45.8 and $55.7, respectively	3,696.1			4,389.7
Expenditures billable to clients	1,742.3			1,518.1
Accounts receivable, net of allowance of $46.8 and $48.6, respectively							Accounts receivable, net of allowance of $46.8 and $48.6, respectively	4,046.9		5,316.0
Accounts receivable, billable to clients							Accounts receivable, billable to clients	2,417.4		2,023.0
Marketable securities							Marketable securities	101.8		1.1
Prepaid expenses							Prepaid expenses	420.7		354.1
Assets held for sale	8.3			203.2			Assets held for sale	9.9		5.9
Other current assets	312.2			229.4			Other current assets	73.8		79.8
Total current assets	6,463.8			7,438.0			Total current assets	8,645.4		10,325.2
Property and equipment, net of accumulated depreciation of $1,045.5 and $961.6, respectively	637.5			622.0
Property and equipment, net of accumulated depreciation and amortization of $1,249.8 and $1,244.8, respectively							Property and equipment, net of accumulated depreciation and amortization of $1,249.8 and $1,244.8, respectively	627.6		637.4
Deferred income taxes	270.9			220.3			Deferred income taxes	289.2		271.7
Goodwill	3,799.9			3,674.4			Goodwill	5,055.1		5,050.6
Other intangible assets							Other intangible assets	763.5		818.1
Operating lease right-of-use assets							Operating lease right-of-use assets	1,182.1		1,277.5
Other non-current assets	544.0			530.5			Other non-current assets	464.4		464.5
TOTAL ASSETS	$	11,716.1		$	12,485.2		TOTAL ASSETS	$	17,027.3	$	18,845.0

LIABILITIES:							LIABILITIES:
Accounts payable	$	5,561.1		$	6,303.6		Accounts payable	$	6,448.4	$	8,235.3
Accrued liabilities	550.7			794.0			Accrued liabilities	632.3		787.1
Contract liabilities							Contract liabilities	688.4		680.0
Short-term borrowings	511.8			85.7			Short-term borrowings	31.0		44.3
Current portion of long-term debt	301.9			323.9			Current portion of long-term debt	250.0		0.6
Current portion of operating leases							Current portion of operating leases	248.7		235.9
Liabilities held for sale	20.8			198.8			Liabilities held for sale	27.4		—
Total current liabilities	6,946.3			7,706.0			Total current liabilities	8,326.2		9,983.2
Long-term debt	1,285.0			1,280.7			Long-term debt	2,916.2		2,870.7
Non-current operating leases							Non-current operating leases	1,247.0		1,380.1
Deferred compensation	457.2			480.7			Deferred compensation	216.8		294.1
Other non-current liabilities	749.4			708.3			Other non-current liabilities	543.4		572.6
TOTAL LIABILITIES	9,437.9			10,175.7			TOTAL LIABILITIES	13,249.6		15,100.7

Redeemable noncontrolling interests (see Note 4)	238.0			252.8
Redeemable non-controlling interests (see Note 5)							Redeemable non-controlling interests (see Note 5)	41.4		38.3

STOCKHOLDERS’ EQUITY:							STOCKHOLDERS’ EQUITY:
Common stock	39.9			39.4			Common stock	39.2		38.9
Additional paid-in capital	1,235.7			1,199.2			Additional paid-in capital	1,052.8		1,057.5
Retained earnings	1,849.8			1,804.3			Retained earnings	3,911.1		3,632.1
Accumulated other comprehensive loss, net of tax	(832.7		)	(962.5		)	Accumulated other comprehensive loss, net of tax	(982.5)		(960.4)
	2,292.7			2,080.4				4,020.6		3,768.1
Less: Treasury stock	(279.3		)	(63.3		)	Less: Treasury stock	(340.4)		(120.2)
Total IPG stockholders’ equity	2,013.4			2,017.1			Total IPG stockholders’ equity	3,680.2		3,647.9
Noncontrolling interests	26.8			39.6
Non-controlling interests							Non-controlling interests	56.1		58.1
TOTAL STOCKHOLDERS’ EQUITY	2,040.2			2,056.7			TOTAL STOCKHOLDERS’ EQUITY	3,736.3		3,706.0
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	11,716.1		$	12,485.2		TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	17,027.3	$	18,845.0

The accompanying notes are an integral part of these unaudited financial statements.

Table of Contents

THE INTERPUBLIC GROUP OF COMPANIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in Millions)

(Unaudited)


	Nine months ended September 30,							Nine months ended September 30,
	2017			2016				2023		2022
CASH FLOWS FROM OPERATING ACTIVITIES:							CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	261.5		$	295.6		Net income	$	646.5	$	650.2
Adjustments to reconcile net income to net cash used in operating activities:							Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization of fixed assets and intangible assets	124.5			117.5
Deferred income tax							Deferred income tax	(5.5)		26.0
Net amortization of bond discounts and deferred financing costs							Net amortization of bond discounts and deferred financing costs	1.7		2.2
Provision for uncollectible receivables	9.5			13.6			Provision for uncollectible receivables	5.3		(5.2)
Net losses on sales of businesses							Net losses on sales of businesses	18.9		4.0
Amortization of restricted stock and other non-cash compensation	59.8			59.0			Amortization of restricted stock and other non-cash compensation	36.0		38.0
Net amortization of bond discounts and deferred financing costs	4.2			4.2
Deferred income tax (benefit) provision	(1.6		)	2.6
Net losses on sales of businesses	20.9			16.1
Depreciation and amortization							Depreciation and amortization	199.0		201.9
Other	16.1			29.8			Other	17.5		0.5
Changes in assets and liabilities, net of acquisitions and divestitures, providing (using) cash:							Changes in assets and liabilities, net of acquisitions and divestitures, providing (using) cash:
Accounts receivable	875.8			666.3			Accounts receivable	1,248.3		725.6
Expenditures billable to clients	(165.9		)	(241.2		)
Accounts receivable, billable to clients							Accounts receivable, billable to clients	(397.8)		38.4
Prepaid expenses							Prepaid expenses	(62.8)		(89.4)
Other current assets	(48.2		)	(20.6		)	Other current assets	11.3		(5.3)
Accounts payable	(986.4		)	(688.4		)	Accounts payable	(1,760.2)		(1,982.4)
Accrued liabilities	(287.8		)	(207.9		)	Accrued liabilities	(150.3)		(232.0)
Contract liabilities							Contract liabilities	12.4		21.5
Other non-current assets and liabilities	(21.4		)	(73.5		)	Other non-current assets and liabilities	(160.4)		(52.8)
Net cash used in operating activities	(139.0		)	(26.9		)	Net cash used in operating activities	(340.1)		(658.8)
CASH FLOWS FROM INVESTING ACTIVITIES:							CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	(108.7		)	(114.5		)	Capital expenditures	(127.1)		(118.5)
Purchase of short-term marketable securities							Purchase of short-term marketable securities	(97.6)		—
Acquisitions, net of cash acquired	(22.6		)	(47.9		)	Acquisitions, net of cash acquired	(6.3)		—
Deconsolidation of a subsidiary							Deconsolidation of a subsidiary	—		(20.4)
Net proceeds from investments							Net proceeds from investments	21.7		2.6
Other investing activities	(9.2		)	(5.1		)	Other investing activities	5.0		10.1
Net cash used in investing activities	(140.5		)	(167.5		)	Net cash used in investing activities	(204.3)		(126.2)
CASH FLOWS FROM FINANCING ACTIVITIES:							CASH FLOWS FROM FINANCING ACTIVITIES:
Common stock dividends							Common stock dividends	(361.2)		(345.1)
Repurchases of common stock	(216.0		)	(193.3		)	Repurchases of common stock	(219.0)		(221.6)
Common stock dividends	(211.2		)	(179.6		)
Tax payments for employee shares withheld							Tax payments for employee shares withheld	(58.4)		(39.9)
Net decrease in short-term borrowings							Net decrease in short-term borrowings	(18.0)		(27.8)
Distributions to non-controlling interests							Distributions to non-controlling interests	(13.7)		(9.6)
Acquisition-related payments	(49.1		)	(36.7		)	Acquisition-related payments	(12.8)		(8.4)
Tax payments for employee shares withheld	(38.4		)	(22.7		)
Repayments of long-term debt	(23.6		)	(1.1		)
Distributions to noncontrolling interests	(16.9		)	(10.8		)
Net increase (decrease) in short-term borrowings	429.9			(33.9		)
Exercise of stock options	12.1			10.2
Proceeds from long-term debt							Proceeds from long-term debt	296.3		0.0
Other financing activities	0.1			1.0			Other financing activities	(3.2)		(0.5)
Net cash used in financing activities	(113.1		)	(466.9		)	Net cash used in financing activities	(390.0)		(652.9)
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash	0.4			50.7			Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash	(35.0)		(59.2)
Net decrease in cash, cash equivalents and restricted cash	(392.2		)	(610.6		)	Net decrease in cash, cash equivalents and restricted cash	(969.4)		(1,497.1)
Cash, cash equivalents and restricted cash at beginning of period	1,100.2			1,506.1			Cash, cash equivalents and restricted cash at beginning of period	2,553.1		3,272.2
Cash, cash equivalents and restricted cash at end of period	$	708.0		$	895.5		Cash, cash equivalents and restricted cash at end of period	$	1,583.7	$	1,775.1

The accompanying notes are an integral part of these unaudited financial statements.

Table of Contents

THE INTERPUBLIC GROUP OF COMPANIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Amounts in Millions)

(Unaudited)


	Common Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss, Net of Tax		Treasury Stock		Total IPG Stockholders’ Equity		Non-controlling Interests		Total Stockholders’ Equity
	Shares	Amount
Balance at June 30, 2023	392.0	$	39.2	$	1,035.2	$	3,782.8	$	(922.7)	$	(248.2)	$	3,686.3	$	59.5	$	3,745.8
Net income						243.7						243.7		2.0		245.7
Other comprehensive loss								(59.8)				(59.8)		(0.3)		(60.1)
Reclassifications related to redeemable non-controlling interests														0.1		0.1
Distributions to non-controlling interests														(5.2)		(5.2)
Change in redemption value of redeemable non-controlling interests						3.7						3.7				3.7
Repurchase of common stock										(92.2)		(92.2)				(92.2)
Common stock dividends ($0.31 per share)						(119.1)						(119.1)				(119.1)
Stock-based compensation	0.2	0.0		17.8								17.8				17.8
Shares withheld for taxes	(0.0)	(0.0)		(0.2)								(0.2)				(0.2)
Other														0.0		0.0
Balance at September 30, 2023	392.2	$	39.2	$	1,052.8	$	3,911.1	$	(982.5)	$	(340.4)	$	3,680.2	$	56.1	$	3,736.3


	Common Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss, Net of Tax		Treasury Stock		Total IPG Stockholders’ Equity		Non-controlling Interests		Total Stockholders’ Equity
	Shares	Amount
Balance at December 31, 2022	389.6	$	38.9	$	1,057.5	$	3,632.1	$	(960.4)	$	(120.2)	$	3,647.9	$	58.1	$	3,706.0
Net income						635.2						635.2		11.3		646.5
Other comprehensive loss								(22.1)				(22.1)		(0.5)		(22.6)
Reclassifications related to redeemable non-controlling interests														0.2		0.2
Distributions to non-controlling interests														(13.7)		(13.7)
Change in redemption value of redeemable non-controlling interests						3.7						3.7				3.7
Repurchase of common stock										(220.2)		(220.2)				(220.2)
Common stock dividends ($0.93 per share)						(359.9)						(359.9)				(359.9)
Stock-based compensation	4.2	0.4		54.2								54.6				54.6
Shares withheld for taxes	(1.6)	(0.1)		(58.9)								(59.0)				(59.0)
Other														0.7		0.7
Balance at September 30, 2023	392.2	$	39.2	$	1,052.8	$	3,911.1	$	(982.5)	$	(340.4)	$	3,680.2	$	56.1	$	3,736.3

Common Stock

Additional
Paid-In
Capital

Retained
Earnings

Accumulated
Other
Comprehensive
Loss, Net of Tax

Treasury
Stock

Total IPG
Stockholders’
Equity

Noncontrolling
Interests

Total
Stockholders’
Equity
Shares Amount
Balance at December 31, 2016 394.3
$ 39.4
$ 1,199.2
$ 1,804.3
$ (962.5 ) $ (63.3 ) $ 2,017.1
$ 39.6
$ 2,056.7
Net income 262.4
262.4
(0.9 ) 261.5
Other comprehensive income 129.8
129.8
0.6
130.4
Reclassifications related to redeemable
noncontrolling interests

7.3
7.3
Distributions to noncontrolling interests (17.5 ) (17.5 )
Change in redemption value of redeemable
noncontrolling interests
(4.6 ) (4.6 ) (4.6 )
Repurchases of common stock (216.0 ) (216.0 ) (216.0 )
Common stock dividends (211.2 ) (211.2 ) (211.2 )
Stock-based compensation 5.6
0.6
62.9
63.5
63.5
Exercise of stock options 1.1
0.1
12.1
12.2
12.2
Shares withheld for taxes (1.6 ) (0.2 ) (38.5 ) (38.7 ) (38.7 )
Other (1.1 ) (1.1 ) (2.3 ) (3.4 )
Balance at September 30, 2017 399.4
$ 39.9
$ 1,235.7
$ 1,849.8
$ (832.7 ) $ (279.3 ) $ 2,013.4
$ 26.8
$ 2,040.2

~~The accompanying notes are an integral part~~Table of ~~these unaudited financial statements.~~Contents

THE INTERPUBLIC GROUP OF COMPANIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY ~~– (CONTINUED)~~

(Amounts in Millions)

(Unaudited)


	Common Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss, Net of Tax		Treasury Stock		Total IPG Stockholders’ Equity		Non-controlling Interests		Total Stockholders’ Equity
	Shares	Amount
Balance at June 30, 2022	396.4	$	39.6	$	1,222.1	$	3,311.8	$	(988.9)	$	(147.9)	$	3,436.7	$	52.3	$	3,489.0
Net income						251.8						251.8		5.7		257.5
Other comprehensive loss								(113.7)				(113.7)		(0.7)		(114.4)
Reclassifications related to redeemable non-controlling interests				0.0								0.0		0.0		0.0
Distributions to non-controlling interests														(4.4)		(4.4)
Change in redemption value of redeemable non-controlling interests						0.1						0.1				0.1
Repurchases of common stock										(73.7)		(73.7)				(73.7)
Common stock dividends ($0.29 per share)						(113.8)						(113.8)				(113.8)
Stock-based compensation	0.2			17.4								17.4				17.4

Shares withheld for taxes				(0.2)								(0.2)				(0.2)
Other														(0.4)		(0.4)
Balance at September 30, 2022	396.6	$	39.6	$	1,239.3	$	3,449.9	$	(1,102.6)	$	(221.6)	$	3,404.6	$	52.5	$	3,457.1

Common Stock
Additional
Paid-In
Capital

Retained
Earnings

Accumulated
Other
Comprehensive
Loss, Net of Tax

Treasury
Stock

Total IPG
Stockholders’
Equity

Noncontrolling
Interests

Total
Stockholders’
Equity
Shares Amount
Balance at December 31, 2015 404.4
$ 40.4
$ 1,404.1
$ 1,437.6
$ (845.6 ) $ (71.0 ) $ 1,965.5
$ 36.3
$ 2,001.8
Net income 290.9
290.9
4.7
295.6
Other comprehensive (loss) income (17.2 ) (17.2 ) 1.2
(16.0 )
Reclassifications related to redeemable
noncontrolling interests
0.5
0.5
Distributions to noncontrolling interests (10.8 ) (10.8 )
Change in redemption value of redeemable
noncontrolling interests
(1.3 ) (1.3 ) (1.3 )
Repurchases of common stock (193.3 ) (193.3 ) (193.3 )
Common stock dividends (179.6 ) (179.6 ) (179.6 )
Stock-based compensation 3.5
0.3
88.2
88.5
88.5
Exercise of stock options 1.2
0.1
10.2
10.3
10.3
Shares withheld for taxes (1.1 ) (0.1 ) (22.9 ) (23.0 ) (23.0 )
Other 1.6
(1.0 ) 0.6
2.2
2.8
Balance at September 30, 2016 408.0
$ 40.7
$ 1,481.2
$ 1,546.6
$ (862.8 ) $ (264.3 ) $ 1,941.4
$ 34.1
$ 1,975.5


	Common Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss, Net of Tax		Treasury Stock		Total IPG Stockholders’ Equity		Non-controlling Interests		Total Stockholders’ Equity
	Shares	Amount
Balance at December 31, 2021	394.3	$	39.3	$	1,226.6	$	3,154.3	$	(894.2)	$	0.0	$	3,526.0	$	63.2	$	3,589.2
Net income						640.8						640.8		9.4		650.2
Other comprehensive loss								(208.4)				(208.4)		(1.7)		(210.1)
Reclassifications related to redeemable non-controlling interests				(3.1)								(3.1)		0.8		(2.3)
Distributions to non-controlling interests														(9.6)		(9.6)
Change in redemption value of redeemable non-controlling interests						(1.2)						(1.2)				(1.2)
Repurchases of common stock										(221.6)		(221.6)				(221.6)
Common stock dividends ($0.87 per share)						(344.0)						(344.0)				(344.0)
Stock-based compensation	3.3	0.4		53.6								54.0				54.0

Shares withheld for taxes	(1.0)	(0.1)		(38.3)								(38.4)				(38.4)
Other				0.5								0.5		(9.6)		(9.1)
Balance at September 30, 2022	396.6	$	39.6	$	1,239.3	$	3,449.9	$	(1,102.6)	$	(221.6)	$	3,404.6	$	52.5	$	3,457.1

The accompanying notes are an integral part of these unaudited financial statements.

Table of Contents

Notes to Consolidated Financial Statements

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Note 1: Basis of Presentation

The unaudited Consolidated Financial Statements have been prepared by The Interpublic Group of Companies, Inc. and its subsidiaries (the ~~"Company," "IPG," "we," "us"~~“Company,” “IPG,” “we,” “us” or ~~"our"~~“our”) in accordance with accounting principles generally accepted in the United States of America ("(“U.S. ~~GAAP"~~GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the ~~"SEC"~~“SEC”) for reporting interim financial information on Form 10-Q. Accordingly, they do not include certain information and disclosures required for complete financial statements. The ~~preparation~~effects of heightened macroeconomic uncertainty have impacted and may continue to impact our results of operations, cash flows and financial ~~statements in conformity with U.S. GAAP requires us to make judgments,~~position. The Company’s Consolidated Financial Statements presented herein reflect the latest estimates and assumptions ~~and estimates~~made by management that affect the reported amounts of assets and liabilities and related disclosures as of the date of the consolidated financial statements and reported amounts of revenue and ~~disclosed.~~ expenses during the reporting periods presented. The Company believes it has used reasonable estimates and assumptions to assess the fair values of goodwill, long-lived assets and indefinite-lived intangible assets; assessment of the annual effective tax rate; valuation of deferred income taxes and allowance for expected credit losses on future uncollectible accounts receivable.

Actual results ~~could~~may differ from these estimates under different assumptions or conditions and ~~assumptions.~~further decline in macroeconomic conditions or increasing interest rates could have a negative impact on these estimates, including the fair value of certain assets. The consolidated results for interim periods are not necessarily indicative of results for the full year and should be read in conjunction with our ~~2016~~ Annual Report on Form ~~10-K.~~10-K for the year ended December 31, 2022 (the “2022 Annual Report”).

We conduct our business across three reportable segments described in Note 10. The three reportable segments are: Media, Data & Engagement Solutions ("MD&E"), Integrated Advertising & Creativity Led Solutions ("IA&C"), and Specialized Communications & Experiential Solutions ("SC&E").

Cost of services is comprised of the expenses of our revenue-producing reportable segments, MD&E, IA&C, and SC&E, including salaries and related expenses, office and other direct expenses and billable expenses, and includes an allocation of the centrally managed expenses from our "Corporate and Other" group. Office and other direct expenses include rent expense, professional fees, certain expenses incurred by our staff in servicing our clients and other costs directly attributable to client engagements.

Selling, general and administrative expenses are primarily the unallocated expenses from Corporate and Other, excluding depreciation and amortization.

Depreciation and amortization of fixed assets and intangible assets of the Company is disclosed as a separate operating expense.

Restructuring charges in 2023 consist of adjustments to the Company's restructuring actions taken in 2022 and 2020, and primarily relate to real estate actions which were designed to reduce our real estate footprint and to better align our cost structure with revenue, as discussed further in Note 5.

In the opinion of management, these unaudited Consolidated Financial Statements include all adjustments, consisting only of normal and recurring adjustments necessary for a fair statement of the information for each period contained therein. Certain reclassifications and immaterial ~~revisions~~adjustments have been made to prior-period financial statements to conform to the current-period ~~presentation.~~presentation, including the recast of certain prior period amounts to reflect the transfer of certain agencies between reportable segments.

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Note 2: Revenue

Disaggregation of Revenue

We have three reportable segments as of September 30, 2023: MD&E, IA&C and SC&E, as further discussed in Note 10. MD&E principally generates revenue from providing global media and communications services, digital services and products, advertising and marketing technology, e‐commerce services, data management and analytics, strategic consulting, and digital brand experience. IA&C principally generates revenue from providing advertising, corporate and brand identity services, and strategic consulting. SC&E generates revenue from providing best-in-class global public relations and communications services, events, sports and entertainment marketing, and strategic consulting.

Our agencies are located in over 100 countries, including every significant world market. Our geographic revenue breakdown is listed below.


	Three months ended September 30,				Nine months ended September 30,
Total revenue:	2023		2022		2023		2022
United States	$	1,759.7	$	1,744.3	$	5,180.1	$	5,171.8
International:
United Kingdom	215.5		195.5		627.6		646.8
Continental Europe	204.5		184.4		612.9		610.2
Asia Pacific	203.8		219.8		607.4		652.9
Latin America	120.0		113.6		321.1		318.0
Other	175.0		180.1		516.9		542.2
Total International	918.8		893.4		2,685.9		2,770.1
Total Consolidated	$	2,678.5	$	2,637.7	$	7,866.0	$	7,941.9


	Three months ended September 30,				Nine months ended September 30,
Revenue before billable expenses:	2023		2022		2023		2022
United States	$	1,509.9	$	1,523.0	$	4,512.3	$	4,548.0
International:
United Kingdom	193.0		176.5		548.1		543.7
Continental Europe	178.3		160.1		534.5		539.2
Asia Pacific	175.3		187.1		511.8		549.5
Latin America	114.8		107.4		301.9		297.0
Other	137.7		142.1		405.8		421.5
Total International	799.1		773.2		2,302.1		2,350.9
Total Consolidated	$	2,309.0	$	2,296.2	$	6,814.4	$	6,898.9

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)


MD&E	Three months ended September 30,				Nine months ended September 30,
Total revenue:	2023		2022		2023		2022
United States	$	669.9	$	659.5	$	1,992.7	$	1,975.8
International	399.4		381.2		1,128.6		1,150.7
Total MD&E	$	1,069.3	$	1,040.7	$	3,121.3	$	3,126.5

Revenue before billable expenses:
United States	$	663.5	$	652.0	$	1,970.2	$	1,943.6
International	390.9		372.2		1,100.5		1,119.6
Total MD&E	$	1,054.4	$	1,024.2	$	3,070.7	$	3,063.2


IA&C	Three months ended September 30,				Nine months ended September 30,
Total revenue:	2023		2022		2023		2022
United States	$	610.2	$	643.6	$	1,878.7	$	1,947.2
International	356.2		367.8		1,062.4		1,132.6
Total IA&C	$	966.4	$	1,011.4	$	2,941.1	$	3,079.8

Revenue before billable expenses:
United States	$	579.9	$	620.0	$	1,782.6	$	1,870.8
International	303.4		307.1		890.0		935.0
Total IA&C	$	883.3	$	927.1	$	2,672.6	$	2,805.8


SC&E	Three months ended September 30,				Nine months ended September 30,
Total revenue:	2023		2022		2023		2022
United States	$	479.6	$	441.2	$	1,308.7	$	1,248.8
International	163.2		144.4		494.9		486.8
Total SC&E	$	642.8	$	585.6	$	1,803.6	$	1,735.6

Revenue before billable expenses:
United States	$	266.5	$	251.0	$	759.5	$	733.6
International	104.8		93.9		311.6		296.3
Total SC&E	$	371.3	$	344.9	$	1,071.1	$	1,029.9

Contract Balances

The following table provides information about receivables, contract assets and contract liabilities from contracts with customers.


	September 30, 2023		December 31, 2022
Accounts receivable, net of allowance of $46.8 and $48.6, respectively	$	4,046.9	$	5,316.0
Accounts receivable, billable to clients	2,417.4		2,023.0
Contract assets	55.7		67.4
Contract liabilities (deferred revenue)	688.4		680.0

Contract assets are primarily comprised of contract incentives that are generally satisfied annually under the terms of our contracts and are transferred to accounts receivable when the right to payment becomes unconditional. Contract liabilities relate

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

to advance consideration received from customers under the terms of our contracts primarily related to reimbursements of third-party expenses, whether we act as principal or agent, and to a lesser extent, periodic retainer fees, both of which are generally recognized shortly after billing.

The majority of our contracts are for periods of one year or less with the exception of our data management contracts. For those contracts with a term of more than one year, we had approximately $780.4 of unsatisfied performance obligations as of September 30, 2023, which will be recognized as services are performed over the remaining contractual terms through 2028.

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Note 2:3: Debt and Credit Arrangements

Long-Term Debt

A summary of the carrying amounts ~~and fair values~~ of our long-term debt is listed below.

Effective
Interest Rate
September 30,
2017 December 31,
2016
Book
Value

Fair
Value ¹

Book
Value

Fair
Value ¹
2.25% Senior Notes due 2017 (less unamortized issuance costs of $0.1) 2.30% $ 299.9
$ 300.2
$ 299.4
$ 301.4
4.00% Senior Notes due 2022 (less unamortized discount and issuance costs of $1.4 and $1.1, respectively) 4.13% 247.5
258.5
247.0
258.4
3.75% Senior Notes due 2023 (less unamortized discount and issuance costs of $0.8 and $2.2, respectively) 4.32% 497.0
520.5
496.6
503.3
4.20% Senior Notes due 2024 (less unamortized discount and issuance costs of $0.7 and $2.7, respectively) 4.24% 496.6
527.0
496.2
511.6
Other notes payable and capitalized leases 45.9
45.9
65.4
65.4
Total long-term debt 1,586.9
1,604.6

Less: current portion 301.9
323.9

Long-term debt, excluding current portion $ 1,285.0
$ 1,280.7


	Effective Interest Rate	September 30, 2023		December 31, 2022

4.200% Senior Notes due 2024 (less unamortized discount and issuance costs of $0.0 and $0.1, respectively)	4.240%	$	249.9	$	249.7
4.650% Senior Notes due 2028 (less unamortized discount and issuance costs of $1.0 and $2.2, respectively)	4.780%	496.8		496.4
4.750% Senior Notes due 2030 (less unamortized discount and issuance costs of $2.7 and $4.0, respectively)	4.920%	643.3		642.6
2.400% Senior Notes due 2031 (less unamortized discount and issuance costs of $0.6 and $3.5, respectively)	2.512%	495.9		495.5
5.375% Senior Notes due 2033 (less unamortized discount and issuance costs of $3.7 and $3.2, respectively)	5.650%	293.1		—
3.375% Senior Notes due 2041 (less unamortized discount and issuance costs of $1.0 and $5.0, respectively)	3.448%	494.0		493.7
5.400% Senior Notes due 2048 (less unamortized discount and issuance costs of $2.5 and $4.7, respectively)	5.480%	492.8		492.6
Other notes payable and finance leases		0.4		0.8
Total long-term debt		3,166.2		2,871.3
Less: current portion		250.0		0.6
Long-term debt, excluding current portion		$	2,916.2	$	2,870.7

As of September 30, 2023 and December 31, 2022, the estimated fair value of the Company's long-term debt was $2,757.6 and $2,552.3, respectively. Refer to Note 11 for details.

Debt Transactions


1	~~See Note 11 for information on the fair value measurement of our long-term debt.~~

5.375% Senior Notes due 2033

On June 8, 2023, we issued a total of $300.0 in aggregate principal amount of 5.375% unsecured senior notes (the "5.375% Senior Notes") due June 15, 2033. Upon issuance, the 5.375% Senior Notes were reflected in our unaudited Consolidated Balance Sheets at $292.9, net of discount of $3.8 and net of capitalized debt issuance costs, including commissions and offering expenses of $3.3, both of which will be amortized in interest expense through the maturity date using the effective interest method. Interest is payable semi-annually in arrears on June 15th and December 15th of each year, commencing on December 15, 2023.

Credit ~~Agreements~~Agreement

We maintain a committed corporate credit facility, originally dated as of July 18, 2008, which has been amended and restated from time to time (the "Credit Agreement"). We use our Credit Agreement to increase our financial flexibility, to provide letters of credit primarily to support obligations of our subsidiaries and to support our commercial paper program. On November 1, 2021, we amended and restated the Credit Agreement. As amended, among other things, the maturity date of the Credit Agreement was extended to November 1, 2026 and the cost structure of the Credit Agreement was changed. The Credit Agreement continues to include a required leverage ratio of not more than 3.50 to 1.00, among other customary covenants, including limitations on our liens and the liens of our consolidated subsidiaries and limitations on the incurrence of subsidiary debt. At the election of the Company, the leverage ratio may be changed to not more than 4.00 to 1.00 for four consecutive quarters, beginning with the fiscal quarter in which there is an occurrence of one or more acquisitions with an aggregate purchase price of at least $200.0.

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

The Credit Agreement is a revolving facility, ~~expiring in October 2020,~~ under which amounts borrowed by us or any of our subsidiaries designated under the Credit Agreement may be repaid and reborrowed, subject to an aggregate lending limit of ~~$1,000.0,~~$1,500.0, or the equivalent in other ~~specified~~ currencies. The Company has the ability to increase the commitments under the Credit Agreement from time to time by an additional amount of up to $250.0, provided the Company receives commitments for such increases and satisfies certain other conditions. The aggregate available amount of letters of credit outstanding may decrease or increase, subject to a sublimit ~~on letters~~ of ~~credit of $200.0,~~$50.0, or the equivalent in other ~~specified~~ currencies. Our obligations under the Credit Agreement are unsecured. As of September 30, ~~2017,~~2023, there were no borrowings under the Credit Agreement; however, we had ~~$8.4~~$9.6 of letters of credit under the Credit Agreement, which reduced our total availability to ~~$991.6.~~$1,490.4. We were in compliance with all of our covenants in the Credit Agreement as of September 30, ~~2017.~~2023.

~~On October 25, 2017, we amended and restated our~~Uncommitted Lines of Credit ~~Agreement. See Note~~ 14 ~~for further discussion.~~

~~Table of Contents~~

~~Notes to Consolidated Financial Statements – (continued)~~

~~(Amounts in Millions, Except Per Share Amounts)~~

~~(Unaudited)~~

We also have uncommitted lines of credit with various banks ~~which~~that permit borrowings at variable interest rates and ~~which~~that are primarily used to fund working capital needs. We have guaranteed the repayment of some of these borrowings made by certain subsidiaries. If we lose access to these credit lines, we would have to provide funding directly to some of our ~~international~~ operations. As of September 30, ~~2017,~~2023, the Company had uncommitted lines of credit in an aggregate amount of ~~$916.8,~~$869.9, under which we had outstanding borrowings of ~~$152.5~~$31.0 classified as short-term borrowings on our Consolidated Balance Sheet. The average amount outstanding during the third quarter of ~~2017~~2023 was ~~$124.7,~~$47.9 with a weighted-average interest rate of approximately ~~3.1%~~9.5%.

Commercial Paper

~~In June 2017, the~~The Company ~~established a commercial paper program under which the Company was~~is authorized to issue unsecured commercial paper up to a maximum aggregate amount outstanding at any time of ~~$1,000.0.~~$1,500.0. Borrowings under the program are supported by the Credit Agreement described above. Proceeds of the commercial paper ~~will be~~are used for working capital and general corporate purposes, including the repayment of maturing indebtedness and other short-term liquidity needs. The maturities of the commercial paper vary but may not exceed 397 days from the date of issue. ~~As of September 30, 2017, the Company had outstanding commercial paper of $359.3 classified as short-term borrowings on our Consolidated Balance Sheet. The average amount outstanding under the program during~~During the third quarter of ~~2017~~2023, there was ~~$488.2, with a weighted-average interest rate of 1.4% and a weighted-average maturity of fourteen days.~~

~~On October 25, 2017, the Company increased the maximum aggregate amount outstanding at any time under our~~no commercial paper ~~program from $1,000.0~~activity and, as of September 30, 2023, there was no commercial paper outstanding.

Table of Contents

Notes to ~~$1,500.0. See Note~~ 14 ~~for further discussion.~~Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Note 3:4: Earnings Per Share

The following sets forth basic and diluted earnings per common share available to IPG common stockholders.


	Three Months Ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022
Net income available to IPG common stockholders	$	243.7	$	251.8	$	635.2	$	640.8

Weighted-average number of common shares outstanding - basic	383.6		390.6		385.0		392.7
Dilutive effect of stock options and restricted shares	1.9		3.5		1.8		3.5
Weighted-average number of common shares outstanding - diluted	385.5		394.1		386.8		396.2

Earnings per share available to IPG common stockholders:
Basic	$	0.64	$	0.64	$	1.65	$	1.63
Diluted	$	0.63	$	0.64	$	1.64	$	1.62

Three months ended
September 30, Nine months ended
September 30,
2017 2016 2017 2016
Net income available to IPG common stockholders $ 146.2
$ 128.6
$ 262.4
$ 290.9

Weighted-average number of common shares outstanding - basic 389.5
397.7
391.2
399.5
       Dilutive effect of stock options and restricted shares 7.7
10.2
7.4
9.3
Weighted-average number of common shares outstanding - diluted 397.2
407.9
398.6
408.8

Earnings per share available to IPG common stockholders:
       Basic $ 0.38
$ 0.32
$ 0.67
$ 0.73
       Diluted $ 0.37
$ 0.32
$ 0.66
$ 0.71

~~Note 4: Acquisitions~~

We continue to evaluate strategic opportunities to expand our industry expertise, strengthen our position in high-growth and key strategic geographical markets and industry sectors, advance our technological capabilities and improve our operational efficiency through both acquisitions and increased ownership interests in current investments. Our acquisitions typically provide for an initial payment at the time of closing and additional contingent purchase price payments based on the future performance of the acquired entity. We have entered into agreements that may require us to purchase additional equity interests in certain consolidated and unconsolidated subsidiaries. The amounts at which we record these transactions in our financial statements are based on estimates of the future financial performance of the acquired entity, the timing of the exercise of these rights, foreign currency exchange rates and other factors.

During the first nine months of 2017, we completed seven acquisitions, including a strategic communications agency based in the U.K., an independent creative agency based in the U.K., a retail branding and design firm based in the U.S., a content creation and marketing agency based in the Netherlands, an independent media agency and digital consultancy based in Finland, and an integrated marketing communications agency based in Canada. All seven of our acquisitions were included in the Integrated Agency Networks ("IAN") operating segment. During the first nine months of 2017, we recorded approximately $48.1 of goodwill and intangible assets related to our acquisitions.

During the first nine months of 2016, we completed nine acquisitions, including a product and service design consultancy based in the U.S., an integrated healthcare marketing communications agency based in the U.S., a content creation and digital agency with offices in the U.S. and the U.K., a mobile consultancy and application development agency based in the U.K., a

~~Table of Contents~~

~~Notes to Consolidated Financial Statements – (continued)~~

~~(Amounts in Millions, Except Per Share Amounts)~~

~~(Unaudited)~~

branded content production agency specializing in sports and entertainment based in Australia, a full-service public relations and digital agency based in China, a search engine optimization and digital content marketing agency based in the U.K., a mobile focused digital agency based in the U.K. and a business consultancy services agency based in Australia. Of our nine acquisitions, three were included in the IAN operating segment, and six were included in the Constituency Management Group ("CMG") operating segment. During the first nine months of 2016, we recorded approximately $147.9 of goodwill and intangible assets related to our acquisitions, primarily in CMG.

The results of operations of our acquired companies were included in our consolidated results from the closing date of each acquisition. Details of cash paid for current and prior years' acquisitions are listed below.

Nine months ended
September 30,
2017 2016
Cost of investment: current-year acquisitions $ 28.1
$ 61.0
Cost of investment: prior-year acquisitions 50.0
37.2
Less: net cash acquired (6.4 ) (13.6 )
Total cost of investment 71.7
84.6
Operating payments ¹
37.5
18.7
Total cash paid for acquisitions ²
$ 109.2
$ 103.3

Represents cash payments for amounts that have been recognized in operating expenses since the date of acquisition either relating to adjustments to estimates in excess of the initial value of contingent payments recorded or were contingent upon the future employment of the former owners of the acquired companies. Amounts are reflected in the operating section of the unaudited Consolidated Statements of Cash Flows.

Of the total cash paid for acquisitions, $22.6 and $47.9 for the nine months ended September 30, 2017 and 2016, respectively, are classified under the investing section of the unaudited Consolidated Statements of Cash Flows, as acquisitions, net of cash acquired. These amounts relate to initial payments for new transactions. Of the total cash paid for acquisitions, $49.1 and $36.7 for the nine months ended September 30, 2017 and 2016, respectively, are classified under the financing section of the unaudited Consolidated Statements of Cash Flows as acquisition-related payments. These amounts relate to deferred payments and increases in our ownership interest for prior acquisitions.

Many of our acquisitions include provisions under which the noncontrolling equity owners may require us to purchase additional interests in a subsidiary at their discretion. Redeemable noncontrolling interests are adjusted quarterly to their estimated redemption value, but not less than their initial fair value. Any adjustments to the redemption value impact retained earnings, except for foreign currency translation adjustments.

~~The following table presents changes in our redeemable noncontrolling interests.~~

Nine months ended
September 30,
2017 2016
Balance at beginning of period $ 252.8
$ 251.9
Change in related noncontrolling interests balance (9.5 ) (1.5 )
Changes in redemption value of redeemable noncontrolling interests:
Additions 3.4
6.8
Redemptions and other (18.5 ) (14.8 )
Redemption value adjustments 9.8
4.5
Balance at end of period $ 238.0
$ 246.9

~~Table of Contents~~

~~Notes to Consolidated Financial Statements – (continued)~~

~~(Amounts in Millions, Except Per Share Amounts)~~

~~(Unaudited)~~

Note 5: Supplementary Data

RestructuringCharges


	Three months ended September 30,				Nine months ended September 30,
	20231		20222		20231		20222
Severance and termination costs	$	0.0	$	0.0	$	0.4	$	0.2
Lease impairment costs	(0.7)		(7.3)		(1.9)		(2.0)
Other restructuring costs	0.1		1.5		0.8		2.5
Total restructuring charges	$	(0.6)	$	(5.8)	$	(0.7)	$	0.7

1The amounts for the three and nine months ended September 30, 2023 represent adjustments to the restructuring actions taken in 2022 and 2020.

2The amounts for the three and nine months ended September 30, 2022 represent adjustments to the restructuring actions taken in 2020.

In the fourth quarter of 2022, the Company took real estate actions related to new real estate exits and lease terminations to further optimize the real estate footprint supporting our office-home hybrid service model in a post-pandemic economy.

A summary of the restructuring activities related to adjustments to the 2022 real estate actions for the nine months ended September 30, 2023 is as follows:


	2022 Real Estate Actions
	Liability at December 31, 2022		Restructuring Expense		Non-Cash Items		Cash Payments		Liability at September 30, 2023

Lease impairment costs	$	0.0	$	(1.4)	$	(1.4)	$	0.0	$	0.0
Other restructuring costs	0.0		0.8		0.2		0.6		0.0
Total	$	0.0	$	(0.6)	$	(1.2)	$	0.6	$	0.0

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Beginning in the second quarter of 2020, the Company took restructuring actions to lower its operating expenses structurally and permanently relative to revenue and to accelerate the transformation of our business (the “2020 Plan”).

A summary of the restructuring activities related to adjustments to the 2020 Plan for the nine months ended September 30, 2023 is as follows:


	2020 Restructuring Plan
	Liability at December 31, 2022		Restructuring Expense		Non-Cash Items		Cash Payments		Liability at September 30, 2023
Severance and termination costs	$	2.3	$	0.4	$	0.0	$	2.0	$	0.7
Lease impairment costs	0.0		(0.5)		(0.5)		0.0		0.0

Total	$	2.3	$	(0.1)	$	(0.5)	$	2.0	$	0.7

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Accrued Liabilities

The following table presents the components of accrued liabilities.


	September 30, 2023		December 31, 2022
Salaries, benefits and related expenses	$	453.8	$	554.0
Interest	59.8		37.3
Income taxes payable	34.8		64.7
Office and related expenses	19.1		28.9
Acquisition obligations	2.1		18.7
Restructuring charges	0.7		2.2
Other	62.0		81.3
Total accrued liabilities	$	632.3	$	787.1

September 30,
2017 December 31,
2016
Salaries, benefits and related expenses $ 341.3
$ 499.0
Acquisition obligations 53.2
77.5
Office and related expenses 48.8
46.7
Interest 17.0
17.3
Other 90.4
153.5
Total accrued liabilities $ 550.7
$ 794.0

Other (Expense) Income, Net

Results of operations for the three and nine months ended September 30, ~~2017~~2023 and ~~2016~~2022 include certain items that are not directly associated with our revenue-producing operations.


	Three months ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022
Net (losses)/gains on sales of businesses	$	(12.1)	$	3.1	$	(18.9)	$	(4.0)
Other	(1.6)		14.4		(5.9)		10.8
Total other (expense) income, net	$	(13.7)	$	17.5	$	(24.8)	$	6.8

Three months ended
September 30, Nine months ended
September 30,
2017 2016 2017 2016
Net (losses) gains on sales of businesses and investments $ (6.2 ) $ 3.9
$ (18.3 ) $ (14.6 )
Other (expense) income, net (3.7 ) 1.4
(6.2 ) 1.1
Total other (expense) income, net $ (9.9 ) $ 5.3
$ (24.5 ) $ (13.5 )

Net ~~(Losses) Gains~~(losses)/gains on ~~Sales~~sales of ~~Businesses and Investments~~ businesses – During the three and nine months ended September 30, ~~2017,~~2023 and 2022, the amounts recognized ~~are primarily~~were related to sales of businesses and the classification of certain assets and liabilities, consisting primarily of accounts receivable and accounts payable, ~~respectively,~~ as held for sale within our ~~IAN operating segment.~~MD&E, IA&C, and SC&E reportable segments. The businesses sold and held for sale primarily represent unprofitable, non-strategic agencies which are expected to be sold within the next twelve months.

Other – During the three and nine months ended September 30, ~~2016,~~2023, the amounts recognized ~~are~~were primarily related to ~~sales~~pension and postretirement costs. During the three months ended September 30, 2022, the amounts recognized were primarily related to a cash gain from the sale of ~~businesses within our IAN operating segment.~~an equity investment. During the nine months ended September 30, 2022, the amounts recognized were primarily attributable to factors noted for the third quarter of 2022, partially offset by a non-cash loss related to the deconsolidation of a previously consolidated entity in which we maintain an equity interest in the second quarter of 2022.

Share Repurchase ~~Program~~Programs

In February ~~2017,~~2022, our Board of Directors (the "Board") reauthorized a program to repurchase, from time to time, up to $400.0 of our common stock.

On February 8, 2023, the Board authorized a ~~new~~ share repurchase program to repurchase from time to time up to ~~$300.0,~~$350.0, excluding fees, of our common stock, ~~(the "2017 Share Repurchase Program"),~~ which was in addition to any amounts remaining under the ~~remaining amount available to be repurchased from the $300.0 authorization made by the Board in February 2016 (the "2016 Share Repurchase Program").~~2022 share repurchase program.

We may effect such repurchases through open market purchases, trading plans established in accordance with ~~SEC~~U.S. Securities and Exchange Commission ("SEC") rules, derivative transactions or other means. ~~We expect to continue to repurchase our common stock in future periods, although the~~The timing and amount of ~~the~~ repurchases in future periods will depend on market conditions and other funding requirements.

The following table presents our share repurchase activity under our share repurchase programs for the nine months ended September 30, ~~2017~~2023 and ~~2016.~~2022.

Nine months ended
September 30,
2017 2016
Number of shares repurchased 9.4
8.5
Aggregate cost, including fees $ 216.0
$ 193.3
Average price per share, including fees $ 22.92
$ 22.69

We fully utilized the 2016 Share Repurchase Program during the third quarter of 2017. As of September 30, 2017, $239.5, excluding fees, remains available for repurchase under the 2017 Share Repurchase Program. The 2017 Share Repurchase Program has no expiration date.

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)


	Nine months ended September 30,
	2023		2022
Number of shares repurchased	6.1		7.1
Aggregate cost, including fees1	$	219.0	$	221.6
Average price per share, including fees	$	35.66	$	31.10

1The amount for nine months ended September 30, 2023 excludes $1.2 of estimated excise tax on net share repurchases.

We fully utilized the 2022 share repurchase program during the second quarter of 2023. As of September 30, 2023, $211.2, excluding fees, remains available for repurchase under the 2023 share repurchase program. There is no expiration date associated with the 2023 share repurchase program.

Redeemable Non-controlling Interests

Many of our acquisitions include provisions under which the non-controlling equity owners may require us to purchase additional interests in a subsidiary at their discretion. Redeemable non-controlling interests are adjusted quarterly, if necessary, to their estimated redemption value, but not less than their initial fair value. Any adjustments to the redemption value impact retained earnings or additional paid in capital, except for foreign currency translation adjustments.

The following table presents changes in our redeemable non-controlling interests.


	Nine months ended September 30,
	2023		2022
Balance at beginning of period	$	38.3	$	15.6
Change in related non-controlling interests balance	(0.1)		(0.8)
Changes in redemption value of redeemable non-controlling interests:
Additions	7.4		3.1
Redemptions	(0.4)		(9.4)
Redemption value adjustments	(3.8)		0.6
Balance at end of period	$	41.4	$	9.1

Goodwill

Goodwill is the excess purchase price remaining from an acquisition after an allocation of purchase price has been made to identifiable assets acquired and liabilities assumed based on estimated fair values.

The Company transferred certain agencies between operating segments as of January 1, 2023 which resulted in certain changes to our reporting units and reportable segments. We have allocated goodwill to our reporting units using a relative fair value approach. In addition, we completed an assessment of any potential goodwill impairment for all impacted reporting units immediately prior and subsequent to the reallocation and determined that no impairment existed.

The following table sets forth details of changes in goodwill by reportable segment of the Company:


	MD&E		IA&C		SC&E		Total
Balance at December 31, 2022	$	2,484.6	$	1,881.6	$	684.4	$	5,050.6
Goodwill Reallocation	180.6		(180.6)		—		—
Balance at January 1, 2023	2,665.2		1,701.0		684.4		5,050.6
Acquisitions	0.9		7.9		1.0		9.8
Foreign Currency and Other	1.9		(6.6)		(0.6)		(5.3)
Balance at September 30, 2023	$	2,668.0	$	1,702.3	$	684.8	$	5,055.1

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Note 6: Income Taxes

For the three ~~and nine~~ months ended September 30, ~~2017,~~2023, our ~~effective~~ income tax ~~rates of 22.1% and 30.7%, respectively, were positively~~expense was negatively impacted by ~~a benefit~~tax expense associated with the change to our assertion regarding the permanent reinvestment of ~~$31.2 related~~undistributed earnings attributable to ~~foreign tax credits from distributions of unremitted earnings, partially offset by losses in~~ certain foreign jurisdictions where we receive no tax benefit due to 100% valuation allowances and by losses on sales of businesses, and the classification of certain assets as held for sale, for which we did not receive a full tax benefit.subsidiaries. For the nine months ended September 30, ~~2017,~~2023, our ~~effective~~ income tax ~~rate~~expense was positively impacted by a benefit of $64.2 related to the settlement of the 2017 and 2018 U.S. Federal income tax audit and excess tax benefits on employee share-based payments, the majority of which ~~is typically~~were recognized in the first quarter due to the timing of the vesting of awards.

We have various tax years under examination by tax authorities in various countries, and in various states, ~~such as New York,~~ in which we have significant business operations. It is not yet known whether these examinations will, in the aggregate, result in our paying additional taxes. We believe our tax reserves are adequate in relation to the potential for additional assessments in each of the jurisdictions in which we are subject to taxation. We regularly assess the likelihood of additional tax assessments in those jurisdictions and, if necessary, adjust our reserves as additional information or events require.

With respect to all tax years open to examination by U.S. federal, various state and local, and non-U.S. tax authorities, we currently anticipate that total unrecognized tax benefits will decrease by an amount between $25.0 and $35.0 in the next twelve months, a portion of which will affect our effective income tax rate, primarily as a result of the settlement of tax examinations and the lapsing of statutes of limitations.

We are effectively settled with respect to U.S. federal income tax audits through ~~2012, with the exception of 2009.~~2018. With limited exceptions, we are no longer subject to state and local income tax audits for years prior to ~~2007~~2015 or non-U.S. income tax audits for years prior to ~~2006.~~2010.

Note 7: Incentive Compensation Plans

We issue stock-based compensation and cash awards to our employees under ~~a plan~~various plans established by the Compensation and Leadership Talent Committee of the Board of Directors (the ~~“Compensation Committee”~~"Compensation Committee") and approved by our ~~shareholders.~~

stockholders. We issued the following stock-based awards under the ~~2014~~2019 Performance Incentive Plan (the ~~"2014~~"2019 PIP") during the nine months ended September 30, ~~2017.~~2023.

Awards
Weighted-average
grant-date fair value
(per award)
Stock-settled awards 0.8
$ 24.20
Performance-based awards 4.8
$ 20.06
Total stock-based compensation awards 5.6


	Awards	Weighted-average grant-date fair value (per award)
Restricted stock (units)	1.4	$	35.56
Performance-based stock (shares)	2.1	$	26.31

Total stock-based compensation awards	3.5

During the nine months ended September 30, ~~2017,~~2023, the Compensation Committee granted performance cash awards under the 2019 PIP and restricted cash awards under the ~~2014 PIP~~2020 Restricted Cash Plan with a total annual target value of ~~$54.3~~$46.1 and ~~$2.8,~~$17.4, respectively. Cash awards are expensed over the vesting period, which is typically three ~~years.~~years for performance cash awards and two years or three years for restricted cash awards.

Note 8: Accumulated Other Comprehensive Loss, Net of Tax

The following tables present the changes in accumulated other comprehensive loss, net of tax, by component.

Foreign Currency
Translation Adjustments

Available-for-Sale
Securities

Derivative
Instruments
Defined Benefit Pension and Other Postretirement Plans Total
Balance as of December 31, 2016 $ (716.7 ) $ 0.6
$ (8.4 ) $ (238.0 ) $ (962.5 )
Other comprehensive income before reclassifications 113.4
0.0
0.0
6.3
119.7
Amount reclassified from accumulated other comprehensive loss, net of tax 1.8
(0.6 ) 1.0
7.9
10.1
Balance as of September 30, 2017 $ (601.5 ) $ 0.0
$ (7.4 ) $ (223.8 ) $ (832.7 )


	Foreign Currency Translation Adjustments		Derivative Instruments		Defined Benefit Pension and Other Postretirement Plans		Total
Balance as of December 31, 2022	$	(815.8)	$	35.0	$	(179.6)	$	(960.4)
Other comprehensive (loss) income before reclassifications	(28.6)		0.5		2.8		(25.3)
Amount reclassified from accumulated other comprehensive loss, net of tax	0.5		(1.3)		4.0		3.2
Balance as of September 30, 2023	$	(843.9)	$	34.2	$	(172.8)	$	(982.5)

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Foreign Currency
Translation Adjustments

Available-for-Sale
Securities

Derivative
Instruments
Defined Benefit Pension and Other Postretirement Plans Total
Balance as of December 31, 2015 $ (665.6 ) $ 1.3
$ (9.6 ) $ (171.7 ) $ (845.6 )
Other comprehensive income before reclassifications 42.3
0.4
0.0
(65.0 ) (22.3 )
Amount reclassified from accumulated other comprehensive loss, net of tax 2.3
(1.2 ) 0.9
3.1
5.1
Balance as of September 30, 2016 $ (621.0 ) $ 0.5
$ (8.7 ) $ (233.6 ) $ (862.8 )


	Foreign Currency Translation Adjustments		Derivative Instruments		Defined Benefit Pension and Other Postretirement Plans		Total
Balance as of December 31, 2021	$	(723.2)	$	22.9	$	(193.9)	$	(894.2)
Other comprehensive (loss) income before reclassifications	(228.5)		13.3		3.4		(211.8)
Amount reclassified from accumulated other comprehensive loss, net of tax	0.5		(0.8)		3.7		3.4
Balance as of September 30, 2022	$	(951.2)	$	35.4	$	(186.8)	$	(1,102.6)

Amounts reclassified from accumulated other comprehensive loss, net of tax, for the three and nine months ended September 30, ~~2017~~2023 and ~~2016~~2022 are as follows:


	Three months ended September 30,				Nine months ended September 30,				Affected Line Item in the Consolidated Statements of Operations
	2023		2022		2023		2022
Foreign currency translation adjustments	$	0.0	$	(1.3)	$	0.5	$	0.5	Other (expense) income, net
Net loss on derivative instruments	(1.1)		(0.4)		(1.7)		(1.1)		Other (expense) income, net, Interest expense
Amortization of defined benefit pension and postretirement plan items	1.8		1.5		5.2		4.8		Other (expense) income, net
Tax effect	—		(0.3)		(0.8)		(0.8)		Provision for income taxes
Total amount reclassified from accumulated other comprehensive loss, net of tax	$	0.7	$	(0.5)	$	3.2	$	3.4

Three months ended
September 30, Nine months ended
September 30, Affected Line Item in the Consolidated Statements of Operations
2017 2016 2017 2016
Foreign currency translation adjustments ¹
$ 1.5
$ (4.2 ) $ 1.8
$ 2.3
Other (expense) income, net
Gains on available-for-sale securities (0.7 ) (0.1 ) (0.7 ) (1.3 ) Other (expense) income, net
Losses on derivative instruments 0.5
0.5
1.6
1.5
Interest expense
Amortization of defined benefit pension and postretirement plan items 5.7
1.3
9.2
4.0
Other (expense) income, net
Tax effect (0.6 ) (0.4 ) (1.8 ) (1.4 ) Provision for income taxes
Total amount reclassified from accumulated other comprehensive loss, net of tax $ 6.4
$ (2.9 ) $ 10.1
$ 5.1

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)


1	~~These foreign currency translation adjustments are primarily a result of the sales of businesses.~~

Note 9: Employee Benefits

We have a defined benefit pension plan that covers certain U.S. employees (the “Domestic Pension Plan”). We also have numerous funded and unfunded plans outside the U.S. The Interpublic Limited Pension Plan in the U.K. is a defined benefit plan and is our most material foreign pension plan in terms of the benefit obligation and plan assets. Some of our domestic and foreign subsidiaries provide postretirement health benefits and life insurance to eligible employees and, in certain cases, their dependents. The domestic postretirement benefit plan is our most material postretirement benefit plan in terms of the benefit ~~obligation.~~obligation. Certain immaterial foreign pension and postretirement benefit plans have been excluded from the table below.

The components of net periodic cost for the Domestic Pension Plan, the significant foreign pension plans and the domestic postretirement benefit plan are listed below.


	Domestic Pension Plan				Foreign Pension Plans				Domestic Postretirement Benefit Plan
Three Months Ended September 30,	2023		2022		2023		2022		2023		2022
Service cost	$	0.0	$	0.0	$	0.8	$	0.9	$	0.0	$	0.0
Interest cost	1.0		0.7		3.9		2.1		0.2		0.2
Expected return on plan assets	(1.0)		(1.1)		(4.3)		(4.7)		0.0		0.0

Amortization of:
Prior service cost	0.1		0.0		0.0		0.0		0.0		0.0
Unrecognized actuarial losses	0.4		0.3		1.3		1.1		0.0		0.1
Net periodic cost	$	0.5	$	(0.1)	$	1.7	$	(0.6)	$	0.2	$	0.3

Domestic Pension Plan Foreign Pension Plans Domestic Postretirement Benefit Plan
Three months ended September 30, 2017 2016 2017 2016 2017 2016
Service cost $ 0.0
$ 0.0
$ 1.0
$ 2.4
$ 0.0
$ 0.0
Interest cost 1.3
1.4
3.4
4.1
0.3
0.4
Expected return on plan assets (1.5 ) (1.5 ) (4.5 ) (4.9 ) 0.0
0.0
Settlements and curtailments 0.0
0.0
4.0
0.1
0.0
0.0
Amortization of:
Prior service cost (credit) 0.0
0.0
0.1
0.1
(0.1 ) (0.1 )
Unrecognized actuarial losses 0.3
0.3
1.4
0.9
0.0
0.0
Net periodic cost $ 0.1
$ 0.2
$ 5.4
$ 2.7
$ 0.2
$ 0.3

~~Table of Contents~~

~~Notes to Consolidated Financial Statements – (continued)~~

~~(Amounts in Millions, Except Per Share Amounts)~~

~~(Unaudited)~~


																				Domestic Pension Plan				Foreign Pension Plans				Domestic Postretirement Benefit Plan
	Domestic Pension Plan						Foreign Pension Plans						Domestic Postretirement Benefit Plan
Nine months ended September 30,	2017			2016			2017			2016			2017			2016
Nine Months Ended September 30,																			Nine Months Ended September 30,	2023		2022		2023		2022		2023		2022
Service cost	$	0.0		$	0.0		$	2.9		$	7.3		$	0.0		$	0.0		Service cost	$	0.0	$	0.0	$	1.4	$	3.2	$	0.0	$	0.0
Interest cost	3.8			4.4			10.0			13.3			0.9			1.1			Interest cost	3.0		2.1		11.8		6.8		0.7		0.5
Expected return on plan assets	(4.6		)	(4.9		)	(13.2		)	(15.5		)	0.0			0.0			Expected return on plan assets	(3.0)		(3.4)		(12.8)		(15.2)		0.0		0.0
Settlements and curtailments	0.0			0.0			4.0			0.3			0.0			0.0

Amortization of:																			Amortization of:
Prior service cost (credit)	0.0			0.0			0.1			0.1			(0.1		)	(0.1		)
Prior service cost																			Prior service cost	0.1		0.0		0.1		0.1		0.0		0.0
Unrecognized actuarial losses	1.1			1.0			4.1			2.7			0.0			0.0			Unrecognized actuarial losses	1.2		1.0		3.8		3.4		0.0		0.3
Net periodic cost	$	0.3		$	0.5		$	7.9		$	8.2		$	0.8		$	1.0		Net periodic cost	$	1.3	$	(0.3)	$	4.3	$	(1.7)	$	0.7	$	0.8

The components of net periodic cost other than the service cost component are included in the line item “Other (expense) income, net” in the Consolidated Statements of Operations.

During the nine months ended September 30, ~~2017,~~2023, we contributed ~~$2.3~~$0.0 and ~~$13.0~~$12.2 of cash to our domestic and foreign pension plans, respectively. For the remainder of ~~2017,~~2023, we expect to contribute approximately ~~$0.3~~$0.0 and ~~$5.0~~$4.0 of cash to our domestic and foreign pension plans, respectively.

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Note 10: Segment Information

As of September 30, ~~2017,~~2023, we have ~~two~~three reportable segments: ~~IAN~~MD&E, IA&C, and ~~CMG. IAN~~SC&E. We also report results for the "Corporate and other" group.

MD&E primarily provides, and is distinguished by innovative capabilities and scale in, global media and communications services, digital services and products, advertising and marketing technology, e‐commerce services, data management and analytics, strategic consulting, and digital brand experience. MD&E is comprised of IPG Mediabrands and Acxiom, as well as our digital and commerce specialist agencies, which include MRM, R/GA, and Huge.

IA&C primarily provides advertising, corporate and brand identity services, and strategic consulting. IA&C is distinguished by the leading role of complex integrations of ideation and the execution of advertising and creative campaigns across all communications channels that are foundational to client brand identities. IA&C is comprised of leading global networks and agencies that provide a broad range of services, including McCann Worldgroup, IPG Health, MullenLowe Group, Foote, Cone & Belding ("FCB"), ~~MullenLowe Group, IPG Mediabrands, our digital specialist agencies~~ and our domestic integrated agencies. ~~CMG~~

SC&E primarily provides best-in-class global public relations and other specialized communications services, events, sports and entertainment marketing, and strategic consulting. SC&E is comprised of agencies that provide a ~~number~~range of ~~our specialist~~ marketing services ~~offerings.~~ expertise, including Weber Shandwick, Golin, our sports, entertainment, and experiential agencies, and DXTRA Health.

In conjunction with the new reporting structure, prior period segment disclosures have been recast to reflect our new reportable segments, as well as the way performance is internally managed and monitored.

We ~~also report results for~~continue to evaluate our financial reporting structure, and the ~~“Corporate and other” group. The~~ profitability measure employed by our chief operating decision maker for allocating resources to operating divisions and assessing operating division performance is segment ~~operating income (loss). Segment information is presented consistently with the basis described in our 2016 Annual Report on Form 10-K.~~

EBITA. Summarized financial information concerning our reportable segments is shown in the following ~~tables.~~table.

Three months ended
September 30, Nine months ended
September 30,
2017 2016 2017 2016
Revenue:
IAN $ 1,520.2
$ 1,503.2
$ 4,465.6
$ 4,453.3
CMG 382.4
419.0
1,075.8
1,128.8
Total $ 1,902.6
$ 1,922.2
$ 5,541.4
$ 5,582.1

Segment operating income (loss):
IAN $ 183.9
$ 184.1
$ 402.1
$ 424.1
CMG 50.1
54.8
127.4
125.2
Corporate and other (14.9 ) (30.9 ) (74.2 ) (94.0 )
Total 219.1
208.0
455.3
455.3

Interest expense (21.0 ) (21.7 ) (67.6 ) (68.8 )
Interest income 4.1
4.7
14.0
16.1
Other (expense) income, net (9.9 ) 5.3
(24.5 ) (13.5 )
Income before income taxes $ 192.3
$ 196.3
$ 377.2
$ 389.1

Depreciation and amortization of property and equipment and intangible assets:
IAN $ 30.7
$ 29.1
$ 90.8
$ 85.9
CMG 4.6
4.9
15.2
14.6
Corporate and other 6.9
5.7
18.5
17.0
Total $ 42.2
$ 39.7
$ 124.5
$ 117.5

Capital expenditures:
IAN $ 29.3
$ 39.7
$ 77.9
$ 86.9
CMG 6.2
4.7
12.9
8.4
Corporate and other 4.3
7.1
17.9
19.2
Total $ 39.8
$ 51.5
$ 108.7
$ 114.5

September 30,
2017 December 31,
2016
Total assets:
IAN $ 10,257.7
$ 10,660.0

CMG 1,433.4
1,428.3

Corporate and other 25.0
396.9

Total $ 11,716.1
$ 12,485.2

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)


	Three months ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022
Total revenue:
MD&E	$	1,069.3	$	1,040.7	$	3,121.3	$	3,126.5
IA&C	966.4		1,011.4		2,941.1		3,079.8
SC&E	642.8		585.6		1,803.6		1,735.6
Total	$	2,678.5	$	2,637.7	$	7,866.0	$	7,941.9

Revenue before billable expenses:
MD&E	$	1,054.4	$	1,024.2	$	3,070.7	$	3,063.2
IA&C	883.3		927.1		2,672.6		2,805.8
SC&E	371.3		344.9		1,071.1		1,029.9
Total	$	2,309.0	$	2,296.2	$	6,814.4	$	6,898.9

Restructuring1:
MD&E	$	(0.1)	$	—	$	(1.3)	$	(0.1)
IA&C	(0.5)		—		(0.2)		6.1
SC&E	(0.2)		(5.8)		0.7		(5.4)
Corporate and Other	0.2		—		0.1		0.1
Total	$	(0.6)	$	(5.8)	$	(0.7)	$	0.7

Segment EBITA2:
MD&E	$	208.0	$	170.3	$	430.4	$	451.0
IA&C	130.4		147.9		361.5		430.8
SC&E	77.7		63.8		194.2		179.3
Corporate and Other	(18.3)		(20.0)		(47.2)		(61.9)
Total	$	397.8	$	362.0	$	938.9	$	999.2

Amortization of acquired intangibles:
MD&E	$	19.2	$	17.7	$	58.0	$	53.4
IA&C	1.2		1.7		3.3		6.4
SC&E	0.6		0.8		1.8		2.8
Corporate and Other	0.0		0.0		0.0		0.0
Total	$	21.0	$	20.2	$	63.1	$	62.6

Depreciation and amortization3:
MD&E	$	26.6	$	26.3	$	79.8	$	78.5
IA&C	13.2		14.7		40.6		43.6
SC&E	4.0		4.3		12.1		12.6
Corporate and Other	1.2		1.5		3.4		4.6
Total	$	45.0	$	46.8	$	135.9	$	139.3

Capital expenditures:
MD&E	$	21.8	$	27.2	$	75.0	$	64.8
IA&C	14.7		9.6		23.6		26.5
SC&E	1.8		2.4		3.8		5.7

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)


Corporate and Other	9.5		7.0		24.7		21.5
Total	$	47.8	$	46.2	$	127.1	$	118.5

1 Non-cash lease impairment costs were comprised of ($0.1) at MD&E, ($0.6) at IA&C and ($0.2) at SC&E for the three months ended September 30, 2023. Non-cash lease impairment costs were comprised of ($1.3) at MD&E and ($0.8) at IA&C for the nine months ended September 30, 2023. Non-cash lease impairment costs were comprised of ($7.3) at SC&E for the three months ended September 30, 2022. Non-cash lease impairment costs were comprised of ($0.1) at MD&E, $5.2 at IA&C, and ($7.1) at SC&E for the nine months ended September 30, 2022.

2 Adjusted EBITA is calculated as net income available to IPG common stockholders before provision for income taxes, total (expenses) and other income, equity in net (loss) income of unconsolidated affiliates, net income attributable to non-controlling interests and amortization of acquired intangibles.

3 Excludes amortization of acquired intangibles.


	September 30, 2023		December 31, 2022
Total assets:
MD&E	$	9,271.7	$	9,984.3
IA&C	4,760.7		5,083.5
SC&E	1,802.5		1,629.9
Corporate and Other	1,192.4		2,147.3
Total	$	17,027.3	$	18,845.0

The following table presents the reconciliation of segment EBITA to Income before income taxes.


	Three months ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022
MD&E EBITA	$	208.0	$	170.3	$	430.4	$	451.0
IA&C EBITA	130.4		147.9		361.5		430.8
SC&E EBITA	77.7		63.8		194.2		179.3
Corporate and Other EBITA	(18.3)		(20.0)		(47.2)		(61.9)
Less: consolidated amortization of acquired intangibles	21.0		20.2		63.1		62.6
Operating income	376.8		341.8		875.8		936.6
Total (expenses) and other income	(37.3)		(10.4)		(91.7)		(80.5)
Income before income taxes	$	339.5	$	331.4	$	784.1	$	856.1

Note 11: Fair Value Measurements

Authoritative guidance for fair value measurements establishes a fair value hierarchy which requires us to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value:



Level 1						Unadjusted quoted prices in active markets for identical assets or liabilities. An active market for the asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

Level 2						Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3						Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Financial Instruments that are Measured at Fair Value on a Recurring Basis

We primarily apply the market approach to determine the fair value of financial instruments that are measured at fair value on a recurring basis. There were no changes to our valuation techniques used to determine the fair value of financial instruments during the nine months ended September 30, ~~2017~~.2023. The following tables present information about our financial instruments measured at fair value on a recurring basis as of September 30, ~~2017~~2023 and December 31, ~~2016~~,2022, and indicate the fair value hierarchy of the valuation techniques utilized to determine such fair value.

September 30, 2017 Balance Sheet Classification
Level 1 Level 2 Level 3 Total
Assets
Cash equivalents $ 153.2
$ 0.0
$ 0.0
$ 153.2
Cash and cash equivalents
Short-term marketable securities 0.1
0.0
0.0
0.1
Other current assets
Long-term investments 0.4
0.0
0.0
0.4
Other non-current assets
Total $ 153.7
$ 0.0
$ 0.0
$ 153.7

As a percentage of total assets 1.3 % 0.0 % 0.0 % 1.3 %

Liabilities
Contingent acquisition obligations¹
$ 0.0
$ 0.0
$ 164.2
$ 164.2

December 31, 2016 Balance Sheet Classification
Level 1 Level 2 Level 3 Total
Assets
Cash equivalents $ 440.8
$ 0.0
$ 0.0
$ 440.8
Cash and cash equivalents
Short-term marketable securities 3.0
0.0
0.0
3.0
Other current assets
Long-term investments 0.4
0.0
0.0
0.4
Other non-current assets
Total $ 444.2
$ 0.0
$ 0.0
$ 444.2

As a percentage of total assets 3.6 % 0.0 % 0.0 % 3.6 %

Liabilities
Contingent acquisition obligations ¹
$ 0.0
$ 0.0
$ 205.4
$ 205.4

Contingent acquisition obligations includes deferred acquisition payments and unconditional obligations to purchase additional noncontrolling equity shares of consolidated subsidiaries. Fair value measurement of the obligations is based upon actual and projected operating performance targets as specified in the related agreements. The decrease in this balance of $41.2 from December 31, 2016 to September 30, 2017 is primarily due to payments of $91.4, partially offset by acquisitions and exercised options of $38.2. The amounts payable within the next twelve months are classified in accrued liabilities; any amounts payable thereafter are classified in other non-current liabilities.

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)


	September 30, 2023								Balance Sheet Classification
	Level 1		Level 2		Level 3		Total
Assets
Cash equivalents	$	581.3	$	—	$	—	$	581.3	Cash and cash equivalents
Marketable securities	$	2.8	$	—	$	—	$	2.8	Marketable securities

Liabilities
Contingent acquisition obligations 1	$	—	$	—	$	2.4	$	2.4	Accrued liabilities and Other non-current liabilities

	December 31, 2022								Balance Sheet Classification
	Level 1		Level 2		Level 3		Total
Assets
Cash equivalents	$	1,688.1	$	—	$	—	$	1,688.1	Cash and cash equivalents
Marketable securities	$	1.1	$	—	$	—	$	1.1	Marketable securities

Liabilities
Contingent acquisition obligations 1	$	—	$	—	$	21.6	$	21.6	Accrued liabilities and Other non-current liabilities

1Contingent acquisition obligations includes deferred acquisition payments and unconditional obligations to purchase additional non-controlling equity shares of consolidated subsidiaries. Fair value measurement of the obligations is based upon actual and projected operating performance targets as specified in the related agreements. The decrease in this balance of $19.2 from December 31, 2022 to September 30, 2023 is primarily due to payments related to our deferred acquisitions payments from prior-year acquisitions and valuation adjustments, partially offset by new acquisitions and the exercises of redeemable non-controlling interest. The amounts payable within the next twelve months are classified in accrued liabilities; any amounts payable thereafter are classified in other non-current liabilities.

Financial Instruments that are not Measured at Fair Value on a Recurring Basis

The following table presents information about our financial instruments that are not measured at fair value on a recurring basis as of September 30, ~~2017~~2023 and December 31, ~~2016~~,2022, and indicates the fair value hierarchy of the valuation techniques utilized to determine such fair value.


	September 30, 2023								December 31, 2022
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets
Marketable securities	$	99.0	$	—	$	—	$	99.0	$	—	$	—	$	—	$	—

Liabilities
Total long-term debt	$	—	$	2,757.2	$	0.4	$	2,757.6	$	—	$	2,551.5	$	0.8	$	2,552.3

September 30, 2017 December 31, 2016
Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total
Total long-term debt $ 0.0
$ 1,606.2
$ 45.9
$ 1,652.1
$ 0.0
$ 1,574.7
$ 65.4
$ 1,640.1
Our marketable securities are comprised of U.S. Treasury Securities with maturity dates of less than 1 year and are classified as held-to-maturity. Held-to-maturity investments are stated at amortized cost. The fair value of our marketable securities are measured based on quoted prices in active markets and are classified as Level 1.

Our long-term debt is comprised of senior notes and other notes payable. The fair value of our senior notes, which are traded over-the-counter, is based on quoted prices ~~for such securities, but for which fair value can also be derived from inputs~~in markets that are ~~readily observable.~~not active. Therefore, these senior notes are classified as Level ~~2 within the fair value hierarchy.~~2. Our other notes payable are not actively traded, and their fair value is not solely derived from readily observable inputs. ~~Thus, the~~The fair value of our other notes payable is determined based on a discounted cash flow model and other proprietary valuation methods, and therefore ~~are~~is classified as Level ~~3 within the fair value hierarchy.~~3. See Note 23 for further information on our long-term debt.

~~Non-financial Assets and Liabilities that are Measured at Fair Value on a Recurring Basis~~

~~Certain non-financial assets and liabilities are measured at~~The discount rates used as significant unobservable inputs in the Level 3 fair value ~~on a recurring basis, primarily accrued restructuring charges.~~measurements of our contingent acquisition obligations and long-term debt as of September 30, 2023 ranged from 3.0% to 6.0%.

Non-financial Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Certain non-financial assets and liabilities are measured at fair value on a nonrecurring basis, primarily goodwill (Level 3), intangible assets, and property and equipment. Accordingly, these assets are not measured and adjusted to fair value on an ongoing basis but are subject to periodic evaluations for potential impairment.

Table of Contents

Notes to Consolidated Financial Statements – (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Note 12: Commitments and Contingencies

Guarantees

As discussed in our 2022 Annual Report, we have guaranteed certain obligations of our subsidiaries relating principally to operating leases and uncommitted lines of credit of certain subsidiaries. As of September 30, 2023 and December 31, 2022, the amount of parent company guarantees on lease obligations was $725.0 and $797.3, respectively, the amount of parent company guarantees primarily relating to uncommitted lines of credit was $276.3 and $276.4, respectively, and the amount of parent company guarantees related to daylight overdrafts, primarily utilized to manage intra-day overdrafts due to timing of transactions under cash pooling arrangements without resulting in incremental borrowings, was $106.8 and $101.3, respectively. In the event of non-payment by the applicable subsidiary of the obligations covered by a guarantee, we would be obligated to pay the amounts covered by that guarantee. As of both September 30, 2023, and December 31, 2022 there were no material assets pledged as security for such parent company guarantees.

Legal Matters

We are involved in various legal proceedings, and subject to investigations, inspections, audits, inquiries and similar actions by governmental authorities arising in the normal course of business. The types of allegations that arise in connection with such legal proceedings ~~may~~ vary in nature, but can include claims related to contract, employment, tax and intellectual property matters. We evaluate all cases each reporting period and record liabilities for losses from legal proceedings when we determine that it is probable that the outcome in a legal proceeding will be unfavorable and the amount, or potential range, of loss can be reasonably estimated. In certain cases, we cannot reasonably estimate the potential loss because, for example, the litigation is in its early stages. While any outcome related to litigation or such governmental proceedings in which we are involved cannot be predicted with certainty, management believes that the outcome of these matters, individually and in the aggregate, will not have a material adverse effect on our financial condition, results of operations or cash flows.

As previously disclosed, on April 10, 2015, a federal judge in Brazil authorized the search of the records of an agency's offices in São Paulo and Brasilia, in connection with an ongoing investigation by Brazilian authorities involving payments potentially connected to local government contracts. The Company had previously investigated the matter and taken a number of remedial and disciplinary actions. The Company is in the process of concluding a settlement related to these matters with government agencies.

The Company confirmed that one of its standalone domestic agencies has been contacted by the Department of Justice Antitrust Division for documents regarding video production practices and is cooperating with the government.

~~Guarantees~~

~~As discussed in our~~ ~~2016~~ Annual Report on Form 10-K, we have guaranteed certain obligations of our subsidiaries relating principally to operating leases and uncommitted lines of credit of certain subsidiaries. The amount of parent company guarantees on lease obligations was $827.8 and $857.3 as of September 30, 2017 and December 31, 2016, respectively, and the amount of parent company guarantees primarily relating to uncommitted lines of credit was $413.8 and $395.6 as of September 30, 2017 and December 31, 2016, respectively.

~~Table of Contents~~

~~Notes to Consolidated Financial Statements – (continued)~~

~~(Amounts in Millions, Except Per Share Amounts)~~

~~(Unaudited)~~

Note 13: Recent Accounting Standards

Accounting pronouncements not listed below were assessed and determined to be not applicable or are expected to have minimal impact on our Consolidated Financial Statements.

Derivatives and Hedging

In ~~August 2017,~~March 2022, the Financial Accounting Standards Board (the "FASB") issued amended guidance on hedge accounting which ~~expands an entity’s ability~~allows nonprepayable financial assets to be included in a closed portfolio hedge ~~non-financial~~using the portfolio layer method, allowing for more consistent accounting over prepayable and ~~financial risk components and aligns the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements.~~nonprepayable hedges. The new guidance also ~~eliminates~~allows multiple hedged layers to be designated for a single closed portfolio, further aligning hedge accounting with risk management strategies. We adopted the ~~requirement to separately measure and report hedge ineffectiveness. This amended guidance is effective beginning~~standard January 1, ~~2019, with early adoption permitted. We are currently assessing the impact the adoption of the amended guidance will have on our Consolidated Financial Statements.~~

~~Pensions~~

~~In March 2017, the FASB issued amended guidance~~2023, which requires presentation of all net periodic pension and postretirement benefit costs, other than service costs, in non-operating expenses in the Consolidated Statement of Operations. We have early adopted this amended guidance retrospectively as of the quarter ended March 31, 2017 using the practical expedient, which permits the use of amounts disclosed in our Employee Benefits note for prior comparative periods as the estimation basis for applying the retrospective presentation requirements. This resulted in the reclassification of a portion of postretirement costs from "Salaries and related expenses" to "Other (expense) income, net" in the amount of $4.8 and $0.8 for the three months ended September 30, 2017 and 2016, respectively, and $6.4 and $2.4 for the nine months ended September 30, 2017 and 2016, respectively.

~~Restricted Cash~~

In November 2016, the FASB issued amended guidance which requires that the Consolidated Statement of Cash Flows present the change during the period in the total cash, cash equivalents and amounts generally described as restricted cash or restricted cash equivalents. We have early adopted this amended guidance retrospectively as of the quarter ended March 31, 2017. The Consolidated Statements of Cash Flows for the nine months ended September 30, 2017 and 2016 now include restricted cash balances of $2.5 and $3.2, respectively, in the beginning-of-period totals and $3.1 and $3.9, respectively, in the end-of-period totals.

~~Financial Instrument Credit Losses~~

In June 2016, the FASB issued amended guidance on the accounting for credit losses on certain types of financial instruments, including trade receivables. The new model uses a forward-looking expected loss method, as opposed to the incurred loss method in current U.S. GAAP, which will generally result in earlier recognition of allowances for losses. This amended guidance is effective beginning January 1, 2020, with early adoption permitted as early as January 1, 2019. We are currently assessing the impact the adoption of the amended guidance will have on our Consolidated Financial Statements.

~~Leases~~

In February 2016, the FASB issued amended guidance on lease accounting which requires an entity to recognize a right-of-use asset and a corresponding lease liability on its balance sheet for virtually all of its leases with a term of more than 12 months, including those classified as operating leases. Both the asset and liability will initially be measured at the present value of the future minimum lease payments, with the asset being subject to adjustments such as initial direct costs. Consistent with current U.S. GAAP, the presentation of expenses and cash flows will depend primarily on the classification of the lease as either a finance or an operating lease. The new standard also requires additional quantitative and qualitative disclosures regarding the amount, timing and uncertainty of cash flows arising from leases in order to provide additional information about the nature of an organization’s leasing activities. This amended guidance, which will be effective beginning January 1, 2019, requires modified retrospective application, with early adoption permitted. We expect the adoption of this amended guidance todid not have a significant impact on our ~~Consolidated Balance Sheets but not on our Consolidated Statements of Operations.~~financial statements.

~~Fair Value Measurements~~

In January 2016, the FASB issued amended guidance which updates the fair value presentation requirements for certain financial instruments. Equity investments with readily determinable fair values, other than those accounted for using the equity method of accounting, will be measured at fair value with changes recorded through current earnings rather than other comprehensive income. This amended guidance will be effective for us beginning January 1, 2018, and is required to be adopted prospectively with a cumulative-effect adjustment recorded on our Consolidated Balance Sheets, if applicable. We do not expect the adoption of this amended guidance to have a significant impact on our Consolidated Financial Statements.

Table of Contents

~~Notes to Consolidated Financial Statements – (continued)~~

~~(Amounts in Millions, Except Per Share Amounts)~~

~~(Unaudited)~~

~~Revenue Recognition~~

In May 2014, the FASB issued amended guidance on revenue recognition which requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods and services. We expect to adopt the standard, which is effective January 1, 2018, using the full retrospective method. The standard impacts the timing of revenue recognition between quarters, primarily as a result of estimating variable consideration. We have determined that the standard will result in an increase in the number of performance obligations within certain of our contractual arrangements. The standard will also result in an increase in third party costs being included in revenue, primarily in connection with our events businesses, which will have no impact on operating income or net income. Additionally, we continue to evaluate the disclosures that may be required.

~~Note 14: Subsequent Events~~

On October 25, 2017, we amended and restated our Credit Agreement, which was most recently amended and restated on October 20, 2015. The amendment increases the revolving commitments under the Credit Agreement from $1,000.0 to $1,500.0 and extends the Credit Agreement's expiration to October 25, 2022. The Credit Agreement is a revolving facility, under which amounts borrowed by us or any of our subsidiaries designated under the Credit Agreement may be repaid and reborrowed. The cost structure, financial covenants and the ability to increase the commitments under the Credit Agreement from time to time by an additional amount of up to $250.0 remain unchanged by the amendment.

On October 25, 2017, the Company increased the maximum aggregate amount outstanding at any time under our commercial paper program from $1,000.0 to $1,500.0. Borrowings under the program continue to be supported by the Credit Agreement, and the proceeds of which will be used for working capital and general corporate purposes, including the repayment of maturing indebtedness and other short-term liquidity needs.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)



Item 2.			Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations ("(“MD~~&A"~~&A”) is intended to help you understand The Interpublic Group of Companies, Inc. and its subsidiaries (the ~~"Company," "IPG," "we," "us"~~“Company,” “IPG,” “we,” “us” or ~~"our"~~“our”). MD&A should be read in conjunction with our unaudited Consolidated Financial Statements and the accompanying notes included in this report and our ~~2016~~Annual Report on Form 10-K for the year ended December 31, 2022 (the “2022 Annual Report”), as well as our other reports and filings with the Securities and Exchange Commission (the ~~"SEC"~~“SEC”). Our 2022 Annual Report includes additional information about our significant accounting policies and practices as well as details about the most significant risks and uncertainties associated with our financial and operating results. Our MD&A includes the following sections:

EXECUTIVE SUMMARY provides a discussion about our strategic outlook, factors influencing our business and an overview of our results of operations.

RESULTS OF OPERATIONS provides an analysis of the consolidated and segment results of operations for the periods presented.

LIQUIDITY AND CAPITAL RESOURCES provides an overview of our cash flows, funding requirements, financing and sources of funds, and debt credit ratings.

CRITICAL ACCOUNTING ESTIMATES provides an update to the discussion in our ~~2016~~2022 Annual Report ~~on Form 10-K~~ of our accounting policies that require critical judgment, assumptions and estimates.

RECENT ACCOUNTING STANDARDS, by reference to Note 13to the unaudited Consolidated Financial Statements, provides a discussion of certain accounting standards that have been recently adopted or that have not yet been required to be implemented and may be applicable to our future operations.

NON-GAAP FINANCIAL MEASURE, provides a reconciliation of non-GAAP financial measure with the most directly comparable generally accepted accounting principles in the United States (“U.S. GAAP”) financial measures and sets forth the reasons we believe that presentation of the non-GAAP financial measure contained therein provides useful information to investors regarding our results of operations and financial condition.

EXECUTIVE SUMMARY

Our Business

We ~~are one~~provide marketing, communications and business transformation services that help marketers and brands succeed in today's digital economy. Combining the power of ~~the world’s premier global advertising~~creativity and ~~marketing services companies.~~technology, our 57,700 employees and operations span all major world markets. Our companies specialize in ~~consumer advertising, digital~~data, creativity, media, consulting, commerce, behavioral science and communications, producing marketing ~~media planning and buying, public relations and specialized communications disciplines. Our agencies create customized marketing programs~~solutions for clients that range in scale from large global marketers to regional and local clients. ~~Comprehensive~~Our comprehensive global services ~~are critical to effectively serve our multinational and local clients in markets throughout the world as they seek to~~help marketers build brands, increase sales of their products and services, and gain market share.

Our capabilities span ideation to execution: growth, product and experience design; technology and experience platforms; creative, media and marketing strategy; and campaign, content and channel orchestration. The work we produce for our clients is specific to their unique needs. Our solutions vary from project-based activity involving one agency to long-term, fully integrated campaigns created by multiple IPG agencies working together. Our operations support the strategic position that marketers have access to the best and most appropriate resources within IPG to drive business success, and may access these capabilities from across the IPG network in a seamless model called Open Architecture®. With operations in over 100 countries, we can operate in a single region or deliver global integrated programs.

We operate in a media, ~~landscape~~consumer and technology ecosystem that continues to evolve at a rapid pace. Media channels continue to fragment, and clients face an increasingly complex consumer environment. To stay ahead of these challenges and to achieve our objectives, we have made and continue to make investments in creative, strategic and ~~strategic~~technology talent in areas including commerce, fast-growth digital marketing channels, high-growth geographic regions and strategic world markets. WeIn addition, we consistently review opportunities within our Company to enhance our operations through ~~mergers~~acquisitions and strategic alliances ~~as well as through the development of~~and internal programs that encourage ~~intra-company~~client-centric collaboration. As appropriate, we also develop relationships with technology and emerging media companies that are building leading-edge marketing tools that complement our agencies' skill sets and capabilities.

Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Home to some of the world’s best-known and most innovative communications specialists, IPG global brands include Acxiom, Craft, FCB, FutureBrand, Golin, Huge, Initiative, IPG Health, Jack Morton, Kinesso, MAGNA, Matterkind, McCann, Mediabrands, Mediahub, Momentum, MRM, MullenLowe Group, Octagon, R/GA, UM, Weber Shandwick and more.

Our financial goals include competitive organic growth of revenue ~~growth~~before billable expenses and ~~operating~~expansion of Adjusted EBITA margin, ~~expansion,~~as defined and discussed within the Non-GAAP Financial Measure section of this MD&A, which we expect will further strengthen our balance sheet and total liquidity and increase value to our ~~shareholders.~~stakeholders. Accordingly, we remain focused on meeting the evolving needs of our clients while concurrently managing our cost structure. We continually seek greater efficiency in the delivery of our services, focusing on more effective resource utilization, including the productivity of our employees, real estate, information technology and shared services, such as finance, human resources and legal. The improvements we have made and continue to make in our financial reporting and business information systems in recent years allow us more timely and actionable insights from our global operations. Our disciplined approach to our balance sheet and liquidity provides us with a solid financial foundation and financial flexibility to manage and grow our business. We believe that our strategy and execution position us to meet our financial goals and to deliver long-term ~~shareholder value.~~value to all of our stakeholders.

Current Market Conditions

In contrast to the robust business environment in 2022, the macroeconomic backdrop in 2023 has been more moderate. The ~~following tables present~~impact of a ~~summary~~slowing economy that we began to see toward the end of ~~financial performance for~~last year on the ~~three and~~more cyclical parts of our business continued to weigh on the first nine months ~~ended September 30, 2017~~of the year, although certain business sectors and ~~2016.~~geographic regions continue to show resilience. The principal macroeconomic risks to our performance include the impact of any general or regional economic slowdown or contraction, the extent of inflation of labor costs and potential for labor shortages, inflationary pressures on our clients and their customers, the economic impacts of geopolitical conflict and uncertainty, and the impact of continuing and unpredictable supply chain disruptions across the global economy. See Item 1A, Risk Factors, in our most recent Annual Report on Form 10-K.

Three months ended
September 30, 2017 Nine months ended
September 30, 2017
% Increase/(Decrease) Total Organic Total Organic
Revenue (1.0 )% 0.5 % (0.7 )% 1.1 %
Salaries and related expenses 0.0 % 1.3 % 0.4 % 2.4 %
Office and general expenses (6.2 )% (3.3 )% (4.0 )% (1.3 )%

~~Management’s Discussion and Analysis of~~Our Financial ~~Condition and Results of Operations - (continued)~~

~~(Amounts in Millions, Except Per Share Amounts)~~

~~(Unaudited)~~

Three months ended
September 30, Nine months ended
September 30,
2017 2016 2017 2016
Operating margin 11.5 % 10.8 % 8.2 % 8.2 %
Expenses as % of revenue:
Salaries and related expenses 64.5 % 63.9 % 67.5 % 66.8 %
Office and general expenses 24.0 % 25.3 % 24.3 % 25.1 %

Net income available to IPG common stockholders $ 146.2
$ 128.6
$ 262.4
$ 290.9

Earnings per share available to IPG common stockholders:
Basic $ 0.38
$ 0.32
$ 0.67
$ 0.73
Diluted $ 0.37
$ 0.32
$ 0.66
$ 0.71
Information

When we analyze period-to-period changes in our operating performance, we determine the portion of the change that is attributable to changes in foreign currency rates and the net effect of acquisitions and divestitures, and the remainder we call organic change, which indicates how our underlying business performed. ~~The~~We exclude the impact of billable expenses in analyzing our operating performance ~~metrics that we use~~as the fluctuations from period to ~~evaluate our results include~~period are not indicative of the organic change in revenue, salaries and related expenses, and office and general expenses, and the components of operating expenses expressed as a percentage of total consolidated revenue. Additionally, in certainperformance of our ~~discussions we analyze revenue by geographic region~~underlying businesses and ~~also by business sector, in which we focus~~have no impact on our ~~top 100 clients, which typically constitute approximately 55% to 60% of our annual consolidated revenues.~~operating income or net income.

The change in our operating performance attributable to changes in foreign currency rates is determined by converting the prior-period reported results using the current-period exchange rates and comparing these prior-period adjusted amounts to the prior-period reported results. Although the U.S. Dollar is our reporting currency, a substantial portion of our revenues and expenses are generated in foreign currencies. Therefore, our reported results are affected by fluctuations in the currencies in which we conduct our international businesses. Our exposure is mitigated as the majority of our revenues and expenses in any given market are generally denominated in the same currency. Both positive and negative currency fluctuations against the U.S. Dollar affect our consolidated results of operations, and the magnitude of the foreign currency impact to our operations related to each geographic region depends on the significance and operating performance of the region. ~~The foreign currency that most adversely impacted our~~Our results during the first nine months of ~~2017 was~~2023 were most adversely impacted by the strength of the U.S. Dollar against the Argentine Peso, Canadian Dollar and British Pound ~~Sterling, partially offset by the Brazilian Real.~~Sterling.

For purposes of analyzing changes in our operating performance attributable to the net effect of acquisitions and divestitures, transactions are treated as if they occurred on the first day of the quarter during which the transaction occurred. ~~During~~We continually evaluate our portfolio of businesses, and over the past ~~few~~several years, we have acquired companies that we believe will enhance our offerings and disposed of businesses that are not consistent with our strategic plan.

The metrics that we use to evaluate our financial performance include organic change in revenue before billable expenses as well as the change in certain operating expenses, and the components thereof, expressed as a percentage of consolidated revenue before billable expenses, as well as Adjusted EBITA. These metrics are also used by management to assess the financial performance of our reportable segments, MD&E, IA&C, and SC&E. In certain of our discussions, we analyze revenue before billable expenses by geographic region and by business sector, in which we focus on our top 500 clients, which typically constitute approximately 85% of our annual consolidated revenue before billable expenses.

Results for the three and nine months ended September 30, 2023, may not be indicative of the results that may be expected for the fiscal year ending December 31, 2023. The Consolidated Financial Statements and MD&A presented herein reflect the latest estimates and assumptions made by us that affect the reported amounts of assets and liabilities and related disclosures as

Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

of the date of the consolidated financial statements and reported amounts of revenue and expenses during the reporting periods presented. We believe we have used reasonable estimates and assumptions to assess the fair values of the Company’s goodwill, long-lived assets and indefinite-lived intangible assets; assessment of the annual effective tax rate; valuation of deferred income taxes and the allowance for expected credit losses on future uncollectible accounts receivable. If actual market conditions vary significantly from those currently projected, these estimates and assumptions could materially change resulting in adjustments to the carrying values of our assets and liabilities.

The following table presents a summary of our financial performance for the three and nine months ended September 30, 2023 and 2022.


	Three months ended September 30,								Nine months ended September 30,
Statement of Operations Data	2023			2022			% Increase/ (Decrease)		2023			2022			% Increase/ (Decrease)
REVENUE:
Revenue before billable expenses	$	2,309.0		$	2,296.2		0.6	%	$	6,814.4		$	6,898.9		(1.2)	%
Billable expenses	369.5			341.5			8.2	%	1,051.6			1,043.0			0.8	%
Total revenue	$	2,678.5		$	2,637.7		1.5	%	$	7,866.0		$	7,941.9		(1.0)	%

OPERATING INCOME	$	376.8		$	341.8		10.2	%	$	875.8		$	936.6		(6.5)	%

Adjusted EBITA 1	$	397.8		$	362.0		9.9	%	$	938.9		$	999.2		(6.0)	%

NET INCOME AVAILABLE TO IPG COMMON STOCKHOLDERS	$	243.7		$	251.8				$	635.2		$	640.8

Earnings per share available to IPG common stockholders:
Basic	$	0.64		$	0.64				$	1.65		$	1.63
Diluted	$	0.63		$	0.64				$	1.64		$	1.62

Operating Ratios
Organic change in revenue before billable expenses	(0.4)		%	5.6		%			(0.8)		%	8.2		%

Operating margin on revenue before billable expenses	16.3		%	14.9		%			12.9		%	13.6		%
Operating margin on total revenue	14.1		%	13.0		%			11.1		%	11.8		%

Adjusted EBITA margin on revenue before billable expenses 1	17.2		%	15.8		%			13.8		%	14.5		%

Expenses as a % of revenue before billable expenses:
Salaries and related expenses	66.3		%	67.4		%			69.1		%	68.1		%
Office and other direct expenses	13.8		%	14.3		%			14.5		%	14.5		%
Selling, general and administrative expenses	0.7		%	0.8		%			0.6		%	0.8		%
Depreciation and amortization	2.9		%	2.9		%			2.9		%	2.9		%
Restructuring charges 2	(0.0) %			(0.3)		%			(0.0) %			0.0		%

1 Adjusted EBITA is a financial measure that is not defined by U.S. GAAP. Adjusted EBITA is calculated as net income available to IPG common stockholders before provision for income taxes, total (expenses) and other income, equity in net (loss) income of unconsolidated affiliates, net income attributable to non-controlling interests and amortization of acquired intangibles. Refer to the “Non-GAAP Financial Measure” section of this MD&A for additional information and for a reconciliation to U.S. GAAP measures.

Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

2 For the three and nine months ended September 30, 2023, results include net restructuring charges of $(0.6) and $(0.7), respectively. For the three and nine months ended September 30, 2022, results include net restructuring charges of $(5.8) and $0.7, respectively. See “Restructuring Charges” in Note 45 to the unaudited Consolidated Financial Statements for ~~additional information~~further information.

Total revenue, which includes billable expenses, increased 1.5% during the third quarter of 2023. Our organic decrease of revenue before billable expenses was (0.4)% during the third quarter of 2023, compared to an organic increase of 5.6% during the third quarter of 2022. The decrease was due to lower spending from existing clients and net client losses in our technology & telecom and retail sectors, partially offset by increased spending from existing clients and net client wins in our auto & transportation, other, financial services, and healthcare sectors. During the third quarter of 2023, our Adjusted EBITA margin on ~~acquisitions.~~revenue before billable expenses increased to 17.2% from 15.8% in the prior-year period as revenue before billable expenses increased, and our operating expenses, excluding billable expenses and amortization of acquired intangibles decreased. See further discussion below in the “Results of Operations” section.

Total revenue, which includes billable expenses, decreased (1.0)% during the first nine months of 2023. Our organic decrease of revenue before billable expenses was (0.8)% during the first nine months of 2023, compared to an organic increase of 8.2% during the first nine months of 2022. The decrease was due to lower spending from existing clients and net client losses in our technology & telecom and retail sectors, partially offset by net client wins in our healthcare, financial services and auto & transportation sectors. During the first nine months of 2023, our Adjusted EBITA margin on revenue before billable expenses decreased to 13.8% from 14.5% in the prior-year period as the decrease in revenue before billable expenses exceeded the slight decrease in our operating expenses, excluding billable expenses and amortization of acquired intangibles. See further discussion below in the “Results of Operations” section.

Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

RESULTS OF OPERATIONS

Consolidated Results of Operations – Three and Nine Months Ended September 30, ~~2017~~2023 Compared to Three and Nine Months Ended September 30, ~~2016~~2022

~~REVENUE~~Revenue before billable expenses

Our revenue before billable expenses is directly impacted by the retention and spending levels of existing clients and by our ability to win new clients. Most of our expenses are recognized ratably throughout the year and are therefore less seasonal than revenue. Our revenue before billable expenses is typically lowest in the first quarter and highest in the fourth quarter, reflecting the seasonal spending of our ~~clients, incentives earned at year end on various contracts and project work completed that is typically recognized~~clients.


			Components of Change								Change
	Three months ended September 30, 2022		Foreign Currency		Net Acquisitions/ (Divestitures)		Organic		Three months ended September 30, 2023		Organic		Total
Consolidated	$	2,296.2	$	15.0	$	8.0	$	(10.2)	$	2,309.0	(0.4)	%	0.6	%
Domestic	1,523.0		—		5.6		(18.7)		1,509.9		(1.2)	%	(0.9)	%
International	773.2		15.0		2.4		8.5		799.1		1.1	%	3.3	%
United Kingdom	176.5		12.7		—		3.8		193.0		2.2	%	9.3	%
Continental Europe	160.1		12.0		—		6.2		178.3		3.9	%	11.4	%
Asia Pacific	187.1		(4.6)		2.1		(9.3)		175.3		(5.0)	%	(6.3)	%
Latin America	107.4		1.3		—		6.1		114.8		5.7	%	6.9	%
Other	142.1		(6.4)		0.3		1.7		137.7		1.2	%	(3.1)	%

The organic decrease of revenue before billable expenses was (0.4)% during the ~~fourth quarter. In the events marketing business, revenues can fluctuate~~third quarter of 2023. The organic decrease in our domestic market was primarily due to revenue decreases at our advertising businesses and digital project-based offerings, partially offset by revenue increases at our media businesses. In our international markets, the ~~timing~~1.1% organic increase was driven by revenue increases at our media businesses, public relations agencies and experiential businesses and was most notable in our Continental Europe and Latin America regions, partially offset by revenue decreases at our digital project-based offerings across all regions.


			Components of Change								Change
	Nine months ended September 30, 2022		Foreign Currency		Net Acquisitions/ (Divestitures)		Organic		Nine months ended September 30, 2023		Organic		Total
Consolidated	$	6,898.9	$	(60.7)	$	29.7	$	(53.5)	$	6,814.4	(0.8)	%	(1.2)	%
Domestic	4,548.0		—		35.1		(70.8)		4,512.3		(1.6)	%	(0.8)	%
International	2,350.9		(60.7)		(5.4)		17.3		2,302.1		0.7	%	(2.1)	%
United Kingdom	543.7		(7.8)		—		12.2		548.1		2.2	%	0.8	%
Continental Europe	539.2		4.7		—		(9.4)		534.5		(1.7)	%	(0.9)	%
Asia Pacific	549.5		(24.0)		4.2		(17.9)		511.8		(3.3)	%	(6.9)	%
Latin America	297.0		(9.6)		(1.4)		15.9		301.9		5.4	%	1.6	%
Other	421.5		(24.0)		(8.2)		16.5		405.8		3.9	%	(3.7)	%

The organic decrease of ~~completed projects, as~~ revenue ~~is typically recognized when~~before billable expenses was (0.8)% during the ~~project is complete. When we act as principal for these projects, we record~~first nine months of 2023. The organic decrease in our domestic market was primarily due to revenue decreases at our advertising businesses and digital project-based offerings, partially offset by revenue increases at our media businesses. In our international markets, the ~~gross amount billed~~0.7% organic increase was driven by growth at our media businesses, public relations agencies and experiential businesses and was most notable in the United Kingdom and Latin America regions, partially offset by revenue decreases at our digital project-based offerings across all regions.

Refer to the ~~client as~~segment discussion later in this MD&A for information on changes in revenue ~~and the related costs are incurred as pass-through costs in office and general~~before billable expenses. by segment.

Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Salaries and Related Expenses


	Three months ended September 30,								Nine months ended September 30,
	2023			2022			% Increase/ (Decrease)		2023			2022			% Increase/ (Decrease)
Salaries and related expenses	$	1,531.1		$	1,546.8		(1.0)	%	$	4,707.0		$	4,701.4		0.1	%









As a % of revenue before billable expenses:
Salaries and related expenses	66.3		%	67.4		%			69.1		%	68.1		%
Base salaries, benefits and tax	58.4		%	57.9		%			60.6		%	58.1		%
Incentive expense	2.6		%	3.3		%			2.8		%	3.9		%
Severance expense	1.0		%	1.1		%			1.4		%	0.7		%
Temporary help	3.4		%	4.0		%			3.3		%	4.4		%
All other salaries and related expenses	0.9		%	1.1		%			1.0		%	1.0		%

Components of Change Change
Three months ended
September 30, 2016
Foreign
Currency

Net
Acquisitions/
(Divestitures)
Organic Three months ended
September 30, 2017 Organic Total
Consolidated $ 1,922.2
$ 7.7
$ (37.2 ) $ 9.9
$ 1,902.6
0.5 % (1.0 )%
Domestic 1,165.9
0.0
(25.0 ) 15.1
1,156.0
1.3 % (0.8 )%
International 756.3
7.7
(12.2 ) (5.2 ) 746.6
(0.7 )% (1.3 )%
United Kingdom 174.0
(4.3 ) 1.4
5.3
176.4
3.0 % 1.4 %
Continental Europe 147.6
6.4
(4.0 ) 0.6
150.6
0.4 % 2.0 %
Asia Pacific 217.9
0.8
(0.2 ) (4.6 ) 213.9
(2.1 )% (1.8 )%
Latin America 103.6
2.4
(10.4 ) (10.3 ) 85.3
(9.9 )% (17.7 )%
Other 113.2
2.4
1.0
3.8
120.4
3.4 % 6.4 %

~~During the third quarter of 2017, our revenue~~Total salaries and related expenses decreased by $19.6, or 1.0%, compared to the third quarter of 2016, comprised of an organic revenue increase of $9.9, or 0.5% and a favorable foreign currency rate impact of $7.7, offset by the effect of net divestitures of $37.2. Our organic revenue increase was primarily attributable to growth within the healthcare sector, offset by decreases in the technology and telecom sector. The organic revenue increase in our domestic market was mainly driven by our media and advertising businesses, partially offset by declines within our digital specialist agencies and a decrease in pass-through revenue related to certain projects where we acted as principal that decreased in size or did not recur in our events businesses(1.0)% during the third quarter of ~~2017,~~2023 as compared to the ~~impact of which is also reflected as~~prior-year period, primarily driven by a ~~comparable reduction~~decrease in ~~office~~performance-based employee compensation expense and general expenses. In our international markets, the organic revenue decrease was primarily attributable to decreases at our advertising businesses in Latin America, most notably in Brazil, and the Asia Pacific region,temporary help expense, partially offset by ~~growth across all regions at our media businesses as well as growth at our advertising businesses~~an increase in ~~the United Kingdom.~~base salaries, benefits and tax.

Components of Change Change
Nine months ended
September 30, 2016
Foreign
Currency

Net
Acquisitions/
(Divestitures)
Organic Nine months ended
September 30, 2017 Organic Total
Consolidated $ 5,582.1
$ (30.7 ) $ (73.8 ) $ 63.8
$ 5,541.4
1.1 % (0.7 )%
Domestic 3,426.2
0.0
(52.5 ) 54.6
3,428.3
1.6 % 0.1 %
International 2,155.9
(30.7 ) (21.3 ) 9.2
2,113.1
0.4 % (2.0 )%
United Kingdom 495.3
(44.5 ) 12.5
8.5
471.8
1.7 % (4.7 )%
Continental Europe 468.1
(3.9 ) (13.3 ) 6.1
457.0
1.3 % (2.4 )%
Asia Pacific 617.7
(0.7 ) 2.4
(12.0 ) 607.4
(1.9 )% (1.7 )%
Latin America 255.7
14.3
(24.6 ) (7.9 ) 237.5
(3.1 )% (7.1 )%
Other 319.1
4.1
1.7
14.5
339.4
4.5 % 6.4 %

~~During~~Total salaries and related expenses increased 0.1% during the first nine months of ~~2017, our revenue~~2023 as compared to the prior-year period, primarily due to an increase in base salaries, benefits and tax as well as severance expense, offset by decreases in performance-based employee compensation expense and temporary help expense.

Office and Other Direct Expenses


	Three months ended September 30,								Nine months ended September 30,
	2023			2022			% Increase/ (Decrease)		2023			2022			% Increase/ (Decrease)
Office and other direct expenses	$	318.8		$	327.9		(2.8)	%	$	989.6		$	1,001.1		(1.1)	%






As a % of revenue before billable expenses:
Office and other direct expenses	13.8		%	14.3		%			14.5		%	14.5		%
Occupancy expense	4.7		%	4.8		%			4.7		%	4.9		%
All other office and other direct expenses 1	9.1		%	9.5		%			9.8		%	9.6		%

1Includes client service costs, non-pass through production expenses, travel and entertainment, professional fees, spending to support new business activity, telecommunications, office supplies, bad debt expense, adjustments to contingent acquisition obligations, foreign currency losses (gains) and other expenses.

Office and other direct expenses decreased by ~~$40.7, or 0.7%,~~(2.8)% during the third quarter of 2023 as compared to the prior-year period. The decrease in office and other direct expenses was mainly driven by to decreases in employment costs, client service costs and occupancy expense, partially offset by foreign currency losses and an increase in bad debt expense.

Office and other direct expenses decreased by (1.1)% during the first nine months of ~~2016, comprised of an organic revenue increase of $63.8, or 1.1%, offset by~~2023 as compared to the ~~effect of net divestitures of $73.8~~prior-year period. The decrease in office and an adverse foreign currency rate impact of $30.7. Our organic revenue increase was primarily attributable to growth within the healthcare sector, offset by decreases in the technology and telecom sector. The organic increase in our domestic market was mainly driven by our media and advertising businesses, offset by weakness in our events and branding businesses. In our international markets, the organic revenue increaseother direct expenses was primarily driven by ~~growth across all regions at~~factors similar to those noted above for the third quarter of 2023.

Selling, General and Administrative Expenses

Selling, general and administrative expenses (“SG&A”) are primarily the unallocated expenses of our ~~media businesses~~"Corporate and ~~our advertising businesses~~Other" group, as detailed further in the United Kingdom, partially offset by decreases at our advertising businesses in the Asia Pacific and Latin America regions and our events businesses in the United Kingdom, primarily as a result of certain projects where we no longer act as principal.

~~Refer to~~ the segment discussion later in this MD&A, ~~for information on changes~~excluding depreciation and amortization. For the three and nine months ended September 30, 2023, SG&A decreased as compared to the prior-year period, primarily due to decreases in ~~revenue by segment.~~performance-based incentive compensation expense.

Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Depreciation and Amortization

~~OPERATING EXPENSES~~

Three months ended
September 30, Nine months ended
September 30,
2017 2016 2017 2016
Salaries and related expenses $ 1,227.6
$ 1,228.0
$ 3,742.3
$ 3,726.3
Office and general expenses 455.9
486.2
1,343.8
1,400.5
Total operating expenses $ 1,683.5
$ 1,714.2
$ 5,086.1
$ 5,126.8
Operating income $ 219.1
$ 208.0
$ 455.3
$ 455.3

InDuring the third quarter ~~of 2017, total operating expenses decreased 1.8%, compared to our revenue decrease of 1.0%, from the third quarter of 2016, resulting in operating margin expansion to 11.5% from 10.8%. In the~~and first nine months of ~~2017, total operating~~2023, depreciation and amortization expenses decreased ~~0.8%, compared to our revenue decrease of 0.7%, from the first nine months of 2016, resulting in an operating margin of 8.2%, which remains flat as~~ compared to the prior-year period.

~~Salaries and Related Expenses~~Restructuring Charges

Components of Change Change
2016
Foreign
Currency

Net
Acquisitions/
(Divestitures)
Organic 2017 Organic Total
Three months ended September 30, $ 1,228.0
$ 4.6
$ (21.0 ) $ 16.0
$ 1,227.6
1.3 % 0.0 %
Nine months ended September 30, 3,726.3
(24.6 ) (49.4 ) 90.0
3,742.3
2.4 % 0.4 %

~~Salaries and related expenses in~~During the third quarter and first nine months of ~~2017 decreased by $0.4 compared~~2023, restructuring charges represent adjustments to our restructuring actions taken in 2020 and 2022. During the third quarter and first nine months of ~~2016, comprised of an organic increase of $16.0~~2022, restructuring charges represent adjustments to our restructuring actions taken in 2020.

EXPENSES AND OTHER INCOME


	Three months ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022
Cash interest on debt obligations	$	(58.3)	$	(41.5)	$	(162.0)	$	(118.5)
Non-cash interest	(0.4)		(1.1)		(2.2)		(2.7)
Interest expense	(58.7)		(42.6)		(164.2)		(121.2)
Interest income	35.1		14.7		97.3		33.9
Net interest expense	(23.6)		(27.9)		(66.9)		(87.3)
Other (expense) income, net	(13.7)		17.5		(24.8)		6.8
Total (expenses) and other income	$	(37.3)	$	(10.4)	$	(91.7)	$	(80.5)

Net interest expense decreased by $4.3 and ~~an adverse foreign currency rate impact of $4.6, offset by~~$20.4 for the ~~effect of net divestitures of $21.0. The organic increase was~~three and nine months ended September 30, 2023, respectively, compared to a year ago, primarily attributable to ~~an increase in base salaries, benefits and tax,~~higher interest rates on net deposits, partially offset by lower ~~incentive expense. Our staff cost ratio, defined as salaries~~net cash balances.

Other Expense, Net

Results of operations for the three and ~~related expenses as a percentage of total consolidated revenue, increased in the third quarter of 2017 to 64.5% from 63.9%, when compared to the prior-year period.~~

~~Salaries and related expenses in the first~~ nine months ended September 30, 2023 and 2022 include certain items that are not directly associated with our revenue-producing operations.


	Three months ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022
Net (losses)/gains on sales of businesses	$	(12.1)	$	3.1	$	(18.9)	$	(4.0)
Other	(1.6)		14.4		(5.9)		10.8
Total other (expense) income, net	$	(13.7)	$	17.5	$	(24.8)	$	6.8

Net (losses)/gains on sales of ~~2017 increased by $16.0 compared to~~businesses – During the ~~first~~three and nine months ended September 30, 2023 and 2022, the amounts recognized were related to sales of ~~2016, comprised~~businesses and the classification of certain assets and liabilities, consisting primarily of accounts receivable and accounts payable, as held for sale within our MD&E, IA&C, and SC&E reportable segments. The businesses sold and held for sale primarily represent unprofitable, non-strategic agencies which are expected to be sold within the next twelve months.

Other – During the three and nine months ended September 30, 2023, the amounts recognized were primarily related to pension and postretirement costs. During the three months ended September 30, 2022, the amounts recognized were primarily related to a cash gain from the sale of an ~~organic increase of $90.0, partially offset by~~equity investment. During the ~~effect of net divestitures of $49.4 and a favorable foreign currency rate impact of $24.6. The organic increase was~~nine months ended September 30, 2022, the amounts recognized were primarily ~~driven by~~attributable to factors ~~similar to those~~ noted ~~above~~ for the third quarter of ~~2017, as well as lower acquisition-related contractual compensation,~~2022, partially offset by a non-cash loss related to the deconsolidation of a previously consolidated entity in which ~~is classified within all other salaries and related expenses~~we maintain an equity interest in the ~~table below. Our staff cost ratio increased in the first nine months~~second quarter of ~~2017 to 67.5% from 66.8% when compared to the prior-year period.~~2022.

~~The following table details our staff cost ratio.~~

Three months ended
September 30, Nine months ended
September 30,
2017 2016 2017 2016
Salaries and related expenses 64.5 % 63.9 % 67.5 % 66.8 %
Base salaries, benefits and tax 55.7 % 53.5 % 57.3 % 55.6 %
Incentive expense 2.0 % 3.7 % 3.1 % 3.8 %
Severance expense 0.8 % 0.7 % 1.0 % 1.0 %
Temporary help 3.8 % 3.9 % 3.9 % 3.9 %
All other salaries and related expenses 2.2 % 2.1 % 2.2 % 2.5 %

Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

~~Office and General Expenses~~

Components of Change Change
2016
Foreign
Currency

Net
Acquisitions/
(Divestitures)
Organic 2017 Organic Total
Three months ended September 30, $ 486.2
$ (0.2 ) $ (13.9 ) $ (16.2 ) $ 455.9
(3.3 )% (6.2 )%
Nine months ended September 30, 1,400.5
(10.8 ) (27.9 ) (18.0 ) 1,343.8
(1.3 )% (4.0 )%

Office and general expenses in the third quarter of 2017 decreased by $30.3 compared to the third quarter of 2016, comprised of an organic decrease of $16.2, the effect of net divestitures of $13.9 and a favorable foreign currency rate impact of $0.2. The organic decrease was attributable to lower production expenses related to pass-through costs, which are also reflected in revenue, partially offset by higher occupancy costs. Our office and general expense ratio, defined as office and general expenses as a percentage of total consolidated revenue, decreased in the third quarter of 2017 to 24.0% from 25.3%, when compared to the prior-year period.

Office and general expenses in the first nine months of 2017 decreased by $56.7 compared to the first nine months of 2016, comprised of an organic decrease of $18.0, the effect of net divestitures of $27.9 and a favorable foreign currency rate impact of $10.8. The organic decrease was primarily driven by factors similar to those noted above for the third quarter of 2017, as well as decreases in adjustments to contingent acquisition obligations, as compared to the prior year. Our office and general expense ratio decreased in the first nine months of 2017 to 24.3% from 25.1%, when compared to the prior-year period.

~~The following table details our office and general expense ratio.~~

Three months ended
September 30, Nine months ended
September 30,
2017 2016 2017 2016
Office and general expenses 24.0 % 25.3 % 24.3 % 25.1 %
Professional fees 1.4 % 1.4 % 1.6 % 1.5 %
Occupancy expense (excluding depreciation and amortization) 6.9 % 6.6 % 7.0 % 6.8 %
Travel & entertainment, office supplies and telecommunications 2.8 % 2.8 % 3.1 % 3.2 %
All other office and general expenses ¹
12.9 % 14.5 % 12.6 % 13.6 %


1	Includes production expenses and, to a lesser extent, depreciation and amortization, bad debt expense, adjustments to contingent acquisition obligations, foreign currency losses (gains), spending to support new business activity, net restructuring and other reorganization-related charges (reversals), long-lived asset impairments and other expenses.

~~EXPENSES AND OTHER INCOME~~

Three months ended
September 30, Nine months ended
September 30,
2017 2016 2017 2016
Cash interest on debt obligations $ (21.0 ) $ (19.5 ) $ (60.1 ) $ (59.8 )
Non-cash interest 0.0
(2.2 ) (7.5 ) (9.0 )
Interest expense (21.0 ) (21.7 ) (67.6 ) (68.8 )
Interest income 4.1
4.7
14.0
16.1
Net interest expense (16.9 ) (17.0 ) (53.6 ) (52.7 )
Other (expense) income, net (9.9 ) 5.3
(24.5 ) (13.5 )
Total (expenses) and other income $ (26.8 ) $ (11.7 ) $ (78.1 ) $ (66.2 )

~~Net Interest Expense~~

For the nine months ended September 30, 2017, net interest expense increased by $0.9 as compared to prior-year period, primarily due to lower interest income from our international markets, partially offset by a decrease in non-cash interest expense from revaluations of mandatorily redeemable noncontrolling interests.

~~Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)~~

~~(Amounts in Millions, Except Per Share Amounts)~~

~~(Unaudited)~~

~~Other (Expense) Income, Net~~

~~Results of operations for the three and nine months ended September 30, 2017 and 2016 include certain items that are not directly associated with our revenue-producing operations.~~

~~Net (Losses) Gains on Sales of Businesses and Investments~~ – During the three and nine months ended September 30, 2017, the amounts recognized are primarily related to sales of businesses and the classification of certain assets and liabilities, consisting primarily of accounts receivable and accounts payable, respectively, as held for sale within our Integrated Agency Networks ("IAN") operating segment. During the three and nine months ended September 30, 2016, the amounts recognized are primarily related to sales of businesses within our IAN segment.

INCOME TAXES

Three months ended
September 30, Nine months ended
September 30,
2017 2016 2017 2016
Income before income taxes $ 192.3
$ 196.3
$ 377.2
$ 389.1
Provision for income taxes $ 42.5
$ 63.8
$ 115.8
$ 91.9
Effective income tax rate 22.1 % 32.5 % 30.7 % 23.6 %


	Three months ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022
INCOME BEFORE INCOME TAXES	$	339.5	$	331.4	$	784.1	$	856.1
Provision for income taxes	$	91.5	$	76.4	$	135.9	$	209.2

Our tax rates are affected by many factors, including our worldwide earnings from various countries, changes in legislation and tax characteristics of our income. For the three months ended September 30, 2023, our income tax expense was negatively impacted by tax expense associated with the change to our assertion regarding the permanent reinvestment of undistributed earnings attributable to certain foreign subsidiaries. For the nine months ended September 30, 2023, our income tax expense was positively impacted by a benefit of $64.2 related to the settlement of the 2017 and 2018 U.S. Federal income tax audit and excess tax benefits on employee share-based payments, the majority of which were recognized in the first quarter due to the timing of the vesting of awards.

For the three and nine months ended September 30, ~~2017, our effective~~2022, our income tax ~~rates of 22.1% and 30.7%, respectively, were~~expense was positively impacted by ~~a benefit~~excess tax benefits on employee share-based payments, the majority of ~~$31.2 related~~which were recognized in the first quarter due to ~~foreign tax credits from distributions~~the timing of ~~unremitted earnings,~~the vesting of awards, partially offset by ~~losses in certain foreign jurisdictions where we receive no tax benefit due to 100% valuation allowances and by~~net losses on sales of businesses and the classification of certain assets as held for sale for which we ~~did not receive a full~~received minimal tax benefit. For the nine months ended September 30, 2017, our effective income tax rate was positively impacted by excess tax benefits on employee share-based payments, the majority of which is typically recognized in the first quarter due to the timing of the vesting of awards.

For the nine months ended September 30, 2016, our effective income tax rate of 23.6% was positively impacted by the settlement of 2011 and 2012 income tax audits which included the recognition of certain previously unrecognized tax benefits of $23.4, the reversal of valuation allowances of $12.2 as a consequence of the disposition of certain businesses in Continental Europe, excess tax benefits on employee share-based payments and the recognition of previously unrecognized tax benefits as a result of a lapse in statute of limitations. The positive impacts to our tax rates were partially offset by losses in certain foreign jurisdictions where we receive no tax benefit due to 100% valuation allowances and by losses on sales of businesses for which we did not receive a full tax benefit.

EARNINGS PER SHARE

Basic earnings per share available to IPG common stockholders for the three and nine months ended September 30, ~~2017~~2023 were ~~$0.38~~$0.64 and ~~$0.67,~~$1.65, respectively, compared to ~~$0.32~~basic earnings per share of $0.64 and ~~$0.73~~$1.63 for the three months and nine months ended September 30, 2022, respectively. Diluted earnings per share available to IPG common stockholders for the three and nine months ended September 30, ~~2016,~~2023 were $0.63 and $1.64, respectively, compared to diluted earnings per share of $0.64 and $1.62 for the three months and nine months ended September 30, 2022, respectively. ~~Diluted~~

Basic and diluted earnings per share for the three ~~and nine~~ months ended September 30, ~~2017 were $0.37~~2023 included negative impacts of $0.04 from the amortization of acquired intangibles and ~~$0.66, respectively, compared to $0.32~~$0.02 from net losses on sales of businesses and ~~$0.71~~the classification of certain assets as held for ~~the three and nine months ended September 30, 2016, respectively.~~sale.

For the three and nine months ended September 30, 2017, net income available to IPG common stockholders included $31.2 related to foreign tax credits from distributions of unremitted earnings, resulting in a positive impact of $0.08 on basic Basic and diluted earnings per share for ~~both periods. For~~ the ~~three and~~ nine months ended September 30, ~~2017,~~2023 included a positive impact of $0.17 related to the settlement of U.S. Federal Income Tax Audits for the years 2017-2018, negative impacts of $0.13 from the amortization of acquired intangibles and $0.04 from net ~~income available to IPG common stockholders included net~~ losses ~~of $7.0 and $19.2, respectively,~~ on sales of businesses and the classification of certain assets as held for sale ~~resulting in negative impacts~~as well as a loss related to the sale of ~~$0.02 and $0.05, respectively, to basic~~an equity investment.

Basic and diluted earnings per ~~share.~~share for the three months ended September 30, 2022 included a negative impact of $0.04 from the amortization of acquired intangibles and positive impacts of $0.01 from restructuring charges, $0.03 from the sale of an equity investment, and $0.01 from net gains on sales of businesses and the classification of certain assets as held for sale.

Basic and diluted earnings per share for the nine months ended September 30, 2022 included negative impacts of $0.13 from the amortization of acquired intangibles, $0.01 from net losses on sales of businesses and the classification of certain assets as held for sale, and $0.01 from the deconsolidation of a previously consolidated entity, as well as a positive impact of $0.03 from the sale of an equity investment.

Segment Results of Operations – Three and Nine Months Ended September 30, 2023 Compared to Three and Nine Months Ended September 30, 2022

As discussed in Note10 to the unaudited Consolidated Financial Statements, we have three reportable segments as of September 30, 2023: MD&E, IA&C and SC&E. We also report results for the “Corporate and Other” group.

Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Media, Data & Engagement Solutions

For the nine months ended September 30, 2016, net income available to IPG common stockholders included the recognition of certain previously unrecognized tax benefits totaling $23.4, losses of $15.7, net of tax, on sales of businesses in our international markets, and a benefit of $12.2 related to the reversals of valuation allowances as a consequence of the sales of businesses, resulting in impacts of $0.06, ($0.04) and $0.03, respectively, to basic and diluted earnings per share.Revenue before billable expenses


			Components of Change								Change
	Three months ended September 30, 2022		Foreign Currency		Net Acquisitions/ (Divestitures)		Organic		Three months ended September 30, 2023		Organic		Total
Consolidated	$	1,024.2	$	7.3	$	17.9	$	5.0	$	1,054.4	0.5	%	2.9	%
Domestic	652.0		—		14.7		(3.2)		663.5		(0.5)	%	1.8	%
International	372.2		7.3		3.2		8.2		390.9		2.2	%	5.0	%

~~Segment Results of Operations – Three and Nine Months Ended September 30, 2017 Compared to Three and Nine Months Ended September 30, 2016~~

~~As discussed in Note~~ 10 ~~to the unaudited Consolidated Financial Statements, we have two reportable segments as of~~ ~~September 30, 2017: IAN and Constituency Management Group ("CMG"). We also report results for the "Corporate and other" group.~~

~~IAN~~

~~REVENUE~~

~~During~~The organic increase during the third quarter of ~~2017, IAN revenue~~2023 was mainly attributable to increased spending from existing clients in our financial services, healthcare and retail sectors, partially offset by ~~$17.0 compared to~~lower spending from existing clients and net client losses in our technology & telecom sectors. The (0.5)% organic decrease during the third quarter of 2016, comprised of an organic revenue increase of $30.7 and a favorable foreign currency rate impact of $8.7, partially offset by the effect of net divestitures of $22.4. The organic revenue increase was primarily attributable to growth within the healthcare sector, partially offset by decreases in the financial services and technology and telecom sectors. The organic revenue increase2023 in our domestic market was ~~mainly driven by~~due to revenue decreases at our ~~media~~digital project-based offerings as well as data management and ~~advertising businesses,~~analytics, partially offset by ~~a decline within our digital specialist agencies. In our international markets, the slight organic~~ revenue ~~decrease was primarily attributable to decreases~~increases at our advertising businesses in Latin America, most notably in Brazil, and the Asia Pacific region, as well as a decline in our digital specialist agencies in the United Kingdom, partially offset by growth across all regions at our media ~~businesses as well as growth at our advertising businesses in the United Kingdom.~~

During the first nine months of 2017, IAN revenue increased by $12.3 compared to the first nine months of 2016, comprised of an organic revenue increase of $77.3, partially offset by the effect of net divestitures of $49.1 and an adverse foreign currency rate impact of $15.9. The organic revenue increase was primarily attributable to growth within the healthcare sector, partially offset by decreases in the financial services and technology and telecom sectors. The organic revenue increase in our domestic market was driven by growth across all disciplines, most notably at our media and advertising businesses. In our international markets, the organic increase was primarily driven by ~~growth~~revenue increases at our media businesses ~~across all regions, most notably~~primarily in ~~Canada within our Other region~~the Continental Europe and in Latin America ~~as well as our advertising businesses in the United Kingdom,~~regions, partially offset by decreases at our ~~advertising~~digital project-based offerings across all regions.


			Components of Change								Change
	Nine months ended September 30, 2022		Foreign Currency		Net Acquisitions/ (Divestitures)		Organic		Nine months ended September 30, 2023		Organic		Total
Consolidated	$	3,063.2	$	(28.7)	$	54.0	$	(17.8)	$	3,070.7	(0.6)	%	0.2	%
Domestic	1,943.6		—		44.2		(17.6)		1,970.2		(0.9)	%	1.4	%
International	1,119.6		(28.7)		9.8		(0.2)		1,100.5		(0.0)	%	(1.7)	%

The organic decrease during the first nine months of 2023 was due to lower spending from existing clients and net client losses in our technology & telecom sectors, partially offset by net client wins and increased spending from existing clients in our financial services and healthcare sectors. The (0.9)% organic decrease during the first nine months of 2023 in our domestic market was due to revenue decreases at our digital project-based offerings, partially offset by revenue increases at our media businesses. In our international markets, the organic change was relatively flat as increases at our media businesses, primarily in the ~~Asia Pacific and~~ Latin America and United Kingdom regions, were offset by decreases at our digital project-based offerings across all regions.

~~SEGMENT OPERATING INCOME~~Segment EBITA


	Three months ended September 30,								Nine months ended September 30,
	2023			2022			Change		2023			2022			Change
Segment EBITA	$	208.0		$	170.3		22.1	%	$	430.4		$	451.0		(4.6)	%
Segment EBITA margin on revenue before billable expenses	19.7		%	16.6		%			14.0		%	14.7		%

Segment EBITA margin increased during the third quarter of 2023 compared to the prior-year period, as revenue before billable expenses, as discussed above, increased while our operating expenses, excluding billable expenses and amortization of acquired intangibles decreased. The slight increase in salaries and related expenses, as compared to the prior-year period, was primarily due to increases in base salaries, benefits and tax, partially offset by decreases in temporary help expense. Office and other direct expense decreased mainly due to decreases client service costs, occupancy expense and employment costs, partially offset by foreign currency losses and an increase in professional consulting fees.

Segment EBITA margin decreased during the first nine months of 2023 compared to the prior-year period, as the increase in revenue before billable expenses, as discussed above, was outpaced by the overall increase in our operating expenses, excluding billable expenses and amortization of acquired intangibles. The increase in salaries and related expenses, as compared to the prior-year period, was primarily due to increases in base salaries, benefits and tax and severance expense, partially offset by decreases in temporary help and performance-based incentive expense. Office and other direct expense

Three months ended
September 30, Nine months ended
September 30,
2017 2016 Change 2017 2016 Change
Segment operating income $ 183.9
$ 184.1
(0.1 )% $ 402.1
$ 424.1
(5.2 )%
Operating margin 12.1 % 12.2 % 9.0 % 9.5 %

Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

decreased mainly due to decreases in occupancy expense, employment costs and client service costs, partially offset by foreign currency losses and increases in bad debt expense.

~~Operating income~~Depreciation and amortization, excluding amortization of acquired intangibles, as a percentage of revenue before billable expenses was 2.5% and 2.6% during the third quarter and first nine months of 2023, respectively, which decreased slightly as compared to the prior-year periods.

Integrated Advertising & Creativity Led Solutions

Revenue before billable expenses


			Components of Change								Change
	Three months ended September 30, 2022		Foreign Currency		Net Acquisitions/ (Divestitures)		Organic		Three months ended September 30, 2023		Organic		Total
Consolidated	$	927.1	$	3.8	$	(9.9)	$	(37.7)	$	883.3	(4.1)	%	(4.7)	%
Domestic	620.0		—		(9.1)		(31.0)		579.9		(5.0)	%	(6.5)	%
International	307.1		3.8		(0.8)		(6.7)		303.4		(2.2)	%	(1.2)	%

The organic decrease during the third quarter of 2023 was due to lower spending from existing clients and net client losses in our technology & telecom, retail and financial services sectors, partially offset by net client wins in our auto & transportation sector. The (5.0)% organic decrease during the third quarter of 2023 in our domestic market was due to revenue decreases in our advertising businesses. In our international markets, the (2.2)% organic decrease was due to revenue decreases in our advertising businesses across all regions.


			Components of Change								Change
	Nine months ended September 30, 2022		Foreign Currency		Net Acquisitions/ (Divestitures)		Organic		Nine months ended September 30, 2023		Organic		Total
Consolidated	$	2,805.8	$	(26.5)	$	(24.3)	$	(82.4)	$	2,672.6	(2.9)	%	(4.7)	%
Domestic	1,870.8		—		(9.1)		(79.1)		1,782.6		(4.2)	%	(4.7)	%
International	935.0		(26.5)		(15.2)		(3.3)		890.0		(0.4)	%	(4.8)	%

The organic decrease during the first nine months of 2023 was due to lower spending from existing clients and net client losses in our technology & telecom retail and financial services sectors, partially offset by net client wins in our auto & transportation sector. The (4.2)% organic decrease during the first nine months of 2023 in our domestic market was due to revenue decreases in our advertising businesses. In our international markets, the (0.4)% organic decrease was due to revenue decreases in our advertising businesses most notably in our Continental Europe and Asia Pacific regions, partially offset by revenue growth in our Other Region, led by the Middle East, and Latin America regions.

Segment EBITA


	Three months ended September 30,								Nine months ended September 30,
	2023			2022			Change		2023			2022			Change
Segment EBITA	$	130.4		$	147.9		(11.8)	%	$	361.5		$	430.8		(16.1)	%
Segment EBITA margin on revenue before billable expenses	14.8		%	16.0		%			13.5		%	15.4		%

Segment EBITA margin decreased during the third quarter of ~~2017 when~~2023 compared to the ~~third quarter of 2016, due to an increase~~prior-year period, as the decrease in revenue ~~of $17.0,~~before billable expenses, as discussed above, ~~and a~~exceeded the overall decrease in ~~office~~our operating expenses, excluding billable expenses and ~~general expenses~~amortization of $5.9, offset by an increase in salaries and related expenses of $23.1. The increase in salaries and related expenses was primarily due to an increase in base salaries, benefits and tax, partially offset by lower incentive expense. The decrease in office and general expenses was attributable to lower production expenses related to pass-through costs, which are also reflected in revenue, and lower bad debt expense, partially offset by higher occupancy costs.

Operating income decreased during the first nine months of 2017 when compared to the first nine months of 2016, comprised of an increase in revenue of $12.3, as discussed above, and a decrease in office and general expenses of $18.1, offset by an increase in salaries and related expenses of $52.4. The increase in salaries and related expenses was primarily driven by factors similar to those noted above for the third quarter of 2017, partially offset by lower acquisition-related contractual compensation. The decrease in office and general expenses was primarily driven by factors similar to those noted above for the third quarter of 2017.

~~CMG~~

~~REVENUE~~

During the third quarter of 2017, CMG revenue decreased by $36.6 compared to the third quarter of 2016, due to an organic revenue decrease of $20.8, the effect of net divestitures of $14.8 and an adverse foreign currency rate impact of $1.0. The organic revenue decreases in our domestic and international markets were primarily driven by a decrease in pass-through revenue related to certain projects where we acted as principal that decreased in size or did not recur in our events businesses during the third quarter of 2017, the impact of which is also reflected as a comparable reduction in office and general expenses.

During the first nine months of 2017, CMG revenue decreased by $53.0 compared to the first nine months of 2016, comprised of an organic revenue decrease of $13.5, the effect of net divestitures of $24.7 and an adverse foreign currency rate impact of $14.8. The organic revenue decreases in our domestic and international markets were primarily driven by factors similar to those noted above for the third quarter of 2017, partially offset by growth at our sports marketing businesses in all regions.

~~SEGMENT OPERATING INCOME~~

Three months ended
September 30, Nine months ended
September 30,
2017 2016 Change 2017 2016 Change
Segment operating income $ 50.1
$ 54.8
(8.6 )% $ 127.4
$ 125.2
1.8 %
Operating margin 13.1 % 13.1 % 11.8 % 11.1 %

Operating income decreased during the third quarter of 2017 when compared to the third quarter of 2016, comprised of a decrease in revenue of $36.6, as discussed above, a decrease in office and general expenses of $21.0 and a decrease in salaries and related expenses of $10.9. The decrease in office and general expenses was primarily due to lower production expenses related to pass-through costs, which are also reflected in revenue, as well as decreases in adjustments to contingent acquisition obligations, as compared to the prior year. acquired intangibles. The decrease in salaries and related expenses, as compared to the prior-year period, was primarily driven by decreases in performance-based incentive expense, temporary help expense and base salaries, benefits and tax. Office and other direct expense decreased mainly due to ~~net divestitures~~decreases in employment costs and occupancy expense, partially offset by foreign currency losses and increases in professional consulting fees.

Table of ~~non-strategic businesses.~~Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Segment EBITA margin decreased during the first nine months of 2023 compared to the prior-year period, as the decrease in revenue before billable expenses, as discussed above, exceeded the overall decrease in our operating expenses, excluding billable expenses and amortization of acquired intangibles. The decrease in salaries and related expenses, as compared to the prior-year period, was mainly due to decreases in temporary help expense and performance-based incentive expense, partially offset by increases in severance expense and base salaries, benefits and tax. Office and other direct expense increased mainly due to foreign currency losses as well as increases in travel and entertainment expense, bad debt expense and expenses related to company meetings and conferences, partially offset by decreases in employment costs and occupancy expense.

~~Operating income~~Depreciation and amortization, excluding amortization of acquired intangibles, as a percentage of revenue before billable expenses was 1.5% during the third quarter and first nine months of 2023, which decreased slightly compared to the prior-year period.

Specialized Communications & Experiential Solutions

Revenue before billable expenses


			Components of Change							Change
	Three months ended September 30, 2022		Foreign Currency		Net Acquisitions/ (Divestitures)	Organic		Three months ended September 30, 2023		Organic		Total
Consolidated	$	344.9	$	3.9	—	$	22.5	$	371.3	6.5	%	7.7	%
Domestic	251.0		—		—	15.5		266.5		6.2	%	6.2	%
International	93.9		3.9		—	7.0		104.8		7.5	%	11.6	%

The organic increase during the third quarter of 2023 was mainly attributable to increased spending from existing clients and net client wins in our other, food & beverage and healthcare sectors, partially offset by net client losses and lower spending from existing clients in our technology & telecom sector. The organic increase of 6.2% during the third quarter of 2023 in our domestic market was driven by revenue increases at our experiential businesses and public relations agencies. In our international markets, the 7.5% organic increase was driven by growth at both our public relations agencies and experiential businesses, and was most notable in the United Kingdom and Asia Pacific regions.


			Components of Change							Change
	Nine months ended September 30, 2022		Foreign Currency		Net Acquisitions/ (Divestitures)	Organic		Nine months ended September 30, 2023		Organic		Total
Consolidated	$	1,029.9	$	(5.5)	—	$	46.7	$	1,071.1	4.5	%	4.0	%
Domestic	733.6		—		—	25.9		759.5		3.5	%	3.5	%
International	296.3		(5.5)		—	20.8		311.6		7.0	%	5.2	%

The organic increase during the first nine months of 2023 was mainly attributable to increased spending from existing clients in our healthcare, other, auto & transportation and financial services sectors, partially offset by net client losses and lower spending from existing clients in our technology & telecom sector. The organic increase of 3.5% during the first nine months of 2023 in our domestic market was driven by revenue increases at our public relations agencies and experiential businesses. In our international markets, the 7.0% organic increase was driven by growth at both our public relations agencies and experiential businesses, and was most notable in the United Kingdom and Asia Pacific regions.

Segment EBITA


	Three months ended September 30,								Nine months ended September 30,
	2023			2022			Change		2023			2022			Change
Segment EBITA	$	77.7		$	63.8		21.8	%	$	194.2		$	179.3		8.3	%
Segment EBITA margin on revenue before billable expenses	20.9		%	18.5		%			18.1		%	17.4		%

Segment EBITA margin increased during the third quarter of 2023 compared to the prior-year period, as the increase in revenue before billable expenses, as discussed above, outpaced the overall increase in our operating expenses, excluding billable expenses and amortization of acquired intangibles. The increase in salaries and related expenses, as compared to the

Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

prior-year period, was primarily due to an increase in base salaries, benefits and tax, partially offset by decreases in severance expense. Office and other direct expense increased mainly due to foreign currency losses and increases in bad debt expense, partially offset by decreases in occupancy expense.

Segment EBITA margin increased during the first nine months of ~~2017 when~~2023 compared to the ~~first nine months of 2016, comprised of a decrease~~prior-year period, as the increase in revenue ~~of $53.0,~~before billable expenses, as discussed above, ~~a decrease~~outpaced the overall increase in ~~office~~our operating expenses, excluding billable expenses and ~~general expenses~~amortization of ~~$35.0 and a decrease~~acquired intangibles. The increase in salaries and related expenses, ~~of $20.2. The~~as compared to the prior-year period, was primarily due to increases in in base salaries, benefits and tax, severance expense and performance-based incentive expense, partially offset by decreases in ~~office~~temporary help expense. Office and ~~general~~other direct expense decreased mainly due to decreases in occupancy expense and ~~salaries~~employment costs, partially offset by foreign currency losses and ~~related~~increases in travel and entertainment expense.

Depreciation and amortization, excluding amortization of acquired intangibles, as a percentage of revenue before billable expenses ~~were primarily driven by factors similar to those noted above for~~was 1.1% during the third quarter of ~~2017.~~2023 and first nine months of 2023, respectively which decreased slightly as compared to the prior-year period.

CORPORATE AND OTHER

~~Certain corporate~~Corporate and ~~other charges are reported as separate line items within total segment operating income (loss)~~Other is primarily comprised of selling, general and ~~include~~administrative expenses including corporate office expenses as well as shared service center and certain other centrally managed expenses that are not fully allocated to operating ~~divisions. Salaries and related expenses include~~divisions; salaries, long-term incentives, annual bonuses and other miscellaneous benefits for corporate office ~~employees. Office and general expenses primarily include~~employees; professional fees related to internal control compliance, financial statement audits and legal, information technology and other consulting services that are engaged and managed through the corporate ~~office. Office~~office; and ~~general expenses also include~~ rental expense ~~and depreciation of leasehold improvements~~ for properties occupied by corporate office employees. A portion of centrally managed expenses ~~are~~is allocated to operating divisions based on a formula that uses the planned revenues of each of the operating units. Amounts allocated also include specific charges for information technology-related projects, which are allocated based on utilization.

~~Corporate and other expenses decreased during~~During the third quarter of ~~2017~~2023, Corporate and Other expenses decreased by ~~$16.0 to $14.9~~$1.7 compared to the ~~third quarter~~prior-year period to $18.3, primarily attributable to a decrease in selling, general and administrative expenses, which is discussed in the Results of ~~2016, primarily due to lower incentive expense.~~Operations section. During the first nine months of ~~2017, corporate~~2023, Corporate and ~~other~~Other expenses decreased by ~~$19.8 to $74.2~~$14.7 compared to the ~~first nine months~~prior-year period to $47.2, primarily attributable to factors similar to those noted for the second quarter of ~~2016, also primarily due to lower incentive expense.~~2023.

LIQUIDITY AND CAPITAL RESOURCES

CASH FLOW OVERVIEW

The following ~~tables summarize~~table summarizes key financial data relating to our liquidity, capital resources and uses of capital.

Nine months ended
September 30,
Cash Flow Data 2017 2016
Net income, adjusted to reconcile to net cash used in operating activities ¹
$ 494.9
$ 538.4
Net cash used in working capital ²
(612.5 ) (491.8 )
Changes in other non-current assets and liabilities using cash (21.4 ) (73.5 )
Net cash used in operating activities $ (139.0 ) $ (26.9 )
Net cash used in investing activities $ (140.5 ) $ (167.5 )
Net cash used in financing activities $ (113.1 ) $ (466.9 )


	Nine months ended September 30,
Cash Flow Data	2023		2022
Net income	$	646.5	$	650.2
Adjustments to reconcile to net cash used in operating activities 1	272.9		267.4
Net cash used in working capital 2	(1,099.1)		(1,523.6)
Changes in other non-current assets and liabilities	(160.4)		(52.8)
Net cash used in operating activities	$	(340.1)	$	(658.8)
Net cash used in investing activities	(204.3)		(126.2)
Net cash used in financing activities	(390.0)		(652.9)


1	Reflects net income adjusted primarily for depreciation and amortization of fixed assets and intangible assets, amortization of restricted stock and other non-cash compensation, net losses on sales of businesses and deferred income taxes.


2	~~Reflects changes in accounts receivable, expenditures billable to clients, other current assets, accounts payable and accrued liabilities.~~

1Consist primarily of depreciation and amortization of fixed assets and intangible assets, amortization of restricted stock and other non-cash compensation and net losses on sales of businesses.

2Reflects changes in accounts receivable, prepaid expenses, other current assets, accounts payable, accrued liabilities and contract liabilities.

Operating Activities

~~Net~~The presentation of the three components of net cash ~~used in~~provided by operating activities ~~during~~above reflects the ~~first nine months~~manner in which management views and analyzes this information. Management believes this presentation is useful as it presents cash provided by operating activities separately from the impact of ~~2017 was $139.0, which was an increase of $112.1 as compared to the first nine months of 2016 driven by higher use of cash~~changes in working ~~capital. Working~~ capital, which is seasonal in nature and is impacted by

Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

the ~~first nine months~~timing of ~~2016 benefited from the spending patterns~~media buying on behalf of our ~~clients compared to~~clients. Additionally, we view changes in other non-current assets and liabilities separately, as these items are not impacted by the ~~first nine months of 2017.~~ factors described below.

Due to the seasonality of our business, we typically use cash from working capital in the first nine months of a year, with the largest impact in the first quarter, and generate cash from working capital in the fourth quarter, ~~of a year. The~~driven by the seasonally strong media spending by our clients. Quarterly and annual working capital ~~use in~~results are impacted by the ~~first nine months~~fluctuating annual media spending budgets of ~~2017 was primarily attributable to~~ our clients as well as their changing media ~~businesses.~~spending patterns throughout each year across various countries.

The timing of media buying on behalf of our clients across various countries affects our working capital and operating cash flow and can be volatile. In most of our businesses, our agencies enter into commitments to pay production and media costs on behalf of clients. To the extent possible, we pay production and media charges after we have received funds from our clients. The amounts involved, which substantially exceed our revenues, ~~and~~ primarily affect the level of accounts receivable, ~~expenditures billable to clients,~~ accounts payable, accrued liabilities and ~~accrued~~contract liabilities. Our assets include both cash received and accounts receivable from clients for these pass-through arrangements, while our liabilities include amounts owed on behalf of clients to media and production suppliers.

~~Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)~~

~~(Amounts in Millions, Except Per Share Amounts)~~

~~(Unaudited)~~

Our accrued liabilities are also affected by the timing of certain other payments. For example, while annual cash incentive awards are accrued throughout the year, they are generally paid during the first quarter of the subsequent year.

Net cash used in operating activities during the first nine months of 2023 decreased to $340.1 from $658.8 in the first nine months of 2022, primarily attributable to a decrease in working capital usage of $424.5. Working capital use was primarily impacted by the spending levels of our clients and variation in the timing of collections and payments around the reporting period.

Investing Activities

Net cash used in investing activities during the first nine months of ~~2017~~2023 was $204.3, which was an increase of $78.1 as compared to the first nine months of 2022, primarily ~~consisted~~driven by an increase in purchases of ~~payments~~short-term marketable securities of $97.6, partially offset by an increase in net proceeds from investments of $19.1 as compared to the first nine months of 2022. Payments for capital expenditures increased to $127.1 from $118.5 in the first nine months of ~~$108.7, related mostly~~2023 and 2022, respectively, primarily attributable to ~~leasehold improvements and~~higher spending on computer ~~hardware and software.~~software, partially offset by decreased spending on computer hardware.

Financing Activities

Net cash used in financing activities during the first nine months of 2023 was $390.0, primarily driven by the payment of common stock dividends of $361.2 and common stock repurchases of $219.0, partially offset by net proceeds of $296.3 from the issuance of our $300.0 aggregate principal amount of 5.375% unsecured senior notes due 2033 (the "5.375% Senior Notes"). See Note 3 in Item 1, Financial Statements, for further information.

Net cash used in financing activities during the first nine months of ~~2017~~2022 was $652.9, primarily driven by the ~~repurchase~~payment of ~~9.4 shares of our~~ common stock ~~for an aggregate cost of $216.0, including fees, and the payment of~~ dividends of ~~$211.2, partially offset by a net increase in short-term borrowings~~$345.1 and common stock repurchases of ~~$429.9.~~$221.6.

Foreign Exchange Rate Changes

The effect of foreign exchange rate changes on cash, cash equivalents and restricted cash included in the unaudited Consolidated Statements of Cash Flows resulted in a net ~~increase~~decrease of ~~$0.4~~$35.0 during the first nine months of ~~2017.~~

Balance Sheet Data September 30,
2017 December 31,
2016 September 30,
2016
Cash, cash equivalents and marketable securities $ 705.0
$ 1,100.6
$ 894.6

Short-term borrowings $ 511.8
$ 85.7
$ 107.8
Current portion of long-term debt 301.9
323.9
24.5
Long-term debt 1,285.0
1,280.7
1,583.3
Total debt $ 2,098.7
$ 1,690.3
$ 1,715.6
2023. The decrease was primarily a result of the U.S. Dollar being stronger than several foreign currencies, including the Australian Dollar, Argentine Peso, British Pound Sterling and Euro as of September 30, 2023 as compared to December 31, 2022.

LIQUIDITY OUTLOOK

We expect our cash flow from operations and existing cash and cash equivalents to be sufficient to meet our anticipated operating requirements at a minimum for the next twelve months. We also have a commercial paper program, a committed corporate credit facility, and uncommitted lines of credit ~~and a commercial paper program available~~ to support our operating needs. Borrowings under our commercial paper program are supported by our committed corporate credit agreement. We continue to maintain a disciplined approach to managing liquidity, with flexibility over significant uses of cash, including our capital expenditures, cash used for new acquisitions, our common stock repurchase program and our common stock dividends.

From time to time, we evaluate market conditions and financing alternatives for opportunities to raise additional funds or otherwise improve our liquidity profile, enhance our financial flexibility and manage market risk. Our ability to access the capital markets depends on a number of factors, which include those specific to us, such as our credit ratings, and those related to the financial markets, such as the amount or terms of available credit. There can be no guarantee that we would be able to access new sources of liquidity, or continue to access existing sources of liquidity, on commercially reasonable terms, or at all.

Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Funding Requirements

Our most significant funding requirements include our operations, non-cancelable operating lease obligations, capital expenditures, acquisitions, common stock dividends, taxes, and debt service. Additionally, we may be required to make payments to minority shareholders in certain subsidiaries if they exercise their options to sell us their equity interests.

Notable funding requirements include:

•Debt service – Our 4.200% Senior Notes in aggregate principal amount of $250.0 mature on April 15, 2024. We expect to use available cash, as well as credit available under our commercial paper and short-term debt lines as needed to fund the principal repayment. As of September 30, ~~2017,~~2023, we had outstanding short-term borrowings of ~~$511.8~~$31.0 from our ~~commercial paper program and~~ uncommitted lines of credit used primarily to fund ~~seasonal~~short-term working capital needs. Our 2.25% Senior Notes in aggregate principal amount of $300.0 mature on November 15, 2017, and we expect to use proceeds from the issuance of commercial paper to repay the outstanding 2.25% Senior Notes upon maturity. The remainder of our debt is primarily long-term, with maturities scheduled from 2028 through ~~2024.~~2048.

~~Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)~~

~~(Amounts in Millions, Except Per Share Amounts)~~

~~(Unaudited)~~

•Acquisitions – We paid cash of ~~$21.7,~~$2.6, net of cash acquired, ~~of $6.4,~~ for acquisitions completed in the first nine months of ~~2017.~~2023, as well as $3.7 in relation to adjustments made to upfront payments related to prior year acquisitions. We ~~also~~ paid ~~$0.9 in up-front payments and $86.6 in~~ deferred payments of $15.6 for ~~prior~~prior-year acquisitions as well as ownership increases in our consolidated ~~subsidiaries.~~subsidiaries in the first nine months of 2023. In addition to potential cash expenditures for new acquisitions, we expect to pay approximately ~~$54.0~~$2.0 over the next twelve months related to ~~prior acquisitions.~~all completed acquisitions as of September 30, 2023. We may also be required to pay approximately ~~$32.0~~$5.0 related to ~~put options~~redeemable non-controlling interest held by minority shareholders, if exercised, over the next twelve months. We will continue to evaluate strategic opportunities to grow and continue to strengthen our market position, particularly in our digital and marketing services offerings, and to expand our presence in high-growth and key strategic world markets.

•Dividends – In the first nine months of ~~2017,~~2023, we paid ~~three~~a quarterly cash ~~dividends~~dividend of ~~$0.18~~$0.310 per share on our common stock, which corresponded to an aggregate dividend payment of ~~$211.2.~~$361.2. Assuming we ~~continue to~~ pay a quarterly dividend of ~~$0.18~~$0.310 per share, and there is no significant change in the number of outstanding shares as of September 30, ~~2017,~~2023, we would expect to pay approximately ~~$280.0~~$475.0 over the next twelve months.

~~Share Repurchase Program~~

~~In February 2017,~~ Whether to declare and the amount of any such future dividend is at the discretion of our Board of Directors (the "Board") and will depend upon factors such as our earnings, financial position and cash requirements.

Share Repurchase Programs

In February 2022, our Board reauthorized a program to repurchase, from time to time, up to $400.0 of our common stock. In February 2023, the Board authorized a ~~new~~ share repurchase program to repurchase from time to time up to ~~$300.0,~~$350.0, excluding fees, of our common stock, ~~("the 2017 Share Repurchase Program"),~~ which was in addition to any amounts remaining under the ~~remaining amount available to be repurchased from the $300.0 authorization made by the Board in February 2016 ("the 2016 Share Repurchase Program").~~2022 share repurchase program. We fully utilized the ~~2016 Share Repurchase Program~~2022 share repurchase program during the ~~third~~second quarter of ~~2017.~~2023. As of September 30, ~~2017, $239.5,~~2023, $211.2, excluding fees, remains available for repurchase under the ~~2017 Share Repurchase Program. The 2017 Share Repurchase Program has no expiration date.~~

2023 share repurchase program. We may effect such repurchases through open market purchases, trading plans established in accordance with ~~SEC~~U.S. Securities and Exchange Commission ("SEC") rules, derivative transactions or other means. ~~We expect to continue to~~There is no expiration date associated with the 2023 share repurchase ~~our common stock in future periods, although the timing and amount of the repurchases will depend on market conditions and other funding requirements.~~program.

FINANCING AND SOURCES OF FUNDS

Substantially all of our operating cash flow is generated by our agencies. Our cash balances are held in numerous jurisdictions throughout the world, including at the holding company level. Below is a summary of our sources of liquidity.

Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

Credit ~~Agreements~~Agreement

We maintain a committed corporate credit facility, originally dated as of July 18, 2008, which has been amended and restated from time to time (the ~~"Credit Agreement"~~“Credit Agreement”). We use our Credit Agreement to increase our financial flexibility, to provide letters of credit primarily to support obligations of our subsidiaries and to support our commercial paper program. On November 1, 2021, we amended and restated the Credit Agreement. As amended, among other things, the maturity date of the Credit Agreement was extended to November 1, 2026 and the cost structure of the Credit Agreement was changed. The Credit Agreement continues to include a required leverage ratio of not more than 3.50 to 1.00, among other customary covenants, including limitations on our liens and the liens of our consolidated subsidiaries and limitations on the incurrence of subsidiary debt. At the election of the Company, the leverage ratio may be changed to not more than 4.00 to 1.00 for four consecutive quarters, beginning with the fiscal quarter in which there is an occurrence of one or more acquisitions with an aggregate purchase price of at least $200.0. The Credit Agreement is a revolving facility, under which amounts borrowed by us or any of our subsidiaries designated under the Credit Agreement may be repaid and reborrowed, subject to an aggregate lending ~~limit. On October 25, 2017, we amended and restated the Credit Agreement, increasing the revolving commitments under the Credit Agreement from $1,000.0 to~~limit of $1,500.0, or the equivalent in other ~~specified currencies, and extending the Credit Agreement's expiration to October 25, 2022. See Note~~ 14 ~~to the unaudited Consolidated Financial Statements included in this Quarterly Report on Form 10-Q for further information.~~

~~We use our Credit Agreement to increase our financial flexibility, to provide letters of credit primarily to support obligations of our subsidiaries and to support our commercial paper program.~~currencies. The Company has the ability to increase the commitments under the Credit Agreement from time to time by an additional amount of up to $250.0, provided the Company receives commitments for such increases and satisfies certain other conditions. The aggregate available amount of letters of credit outstanding may decrease or increase, subject to a sublimit ~~on letters~~ of ~~credit of $200.0,~~$50.0, or the equivalent in other ~~specified~~ currencies. Our obligations under the Credit Agreement are unsecured. As of September 30, ~~2017,~~2023, there were no borrowings under the Credit Agreement; however, we had ~~$8.4~~$9.6 of letters of credit under the Credit Agreement, which reduced our total availability to ~~$991.6.~~$1,490.4.

We were in compliance with all of our covenants in the Credit Agreement as of September 30, ~~2017.~~ 2023. Management utilizes Credit Agreement EBITDA, which is a non-GAAP financial measure, as well as the amounts shown in the table below, calculated as required by the Credit Agreement, in order to assess our compliance with such covenants.

Four Quarters
Ended

Financial Covenant

September 30, 2023

Credit Agreement EBITDA Reconciliation

September 30, 2023

Leverage ratio (not greater than) 1

3.50x

Net income available to IPG common stockholders

932.4

Actual leverage ratio

1.84x

Non-operating adjustments 2

388.0

Operating income

1,320.4

Add:

Depreciation and amortization

333.6

Other non-cash charges reducing operating income

85.5

Credit Agreement EBITDA 1

1,739.5

1The ~~financial covenants~~leverage ratio is defined as debt as of the last day of such fiscal quarter to EBITDA (as defined in the Credit ~~Agreement require that we maintain, as of the end of each fiscal quarter, certain financial measures~~Agreement) for the four quarters then ended.

2Includes adjustments of the following items from our Consolidated Statements of Operations: provision for income taxes, total (expenses) and other income, equity in net income of unconsolidated affiliates, and net income attributable to non-controlling interests.

~~Management’s Discussion and Analysis~~Uncommitted Lines of ~~Financial Condition and Results of Operations - (continued)~~Credit

~~(Amounts in Millions, Except Per Share Amounts)~~

~~(Unaudited)~~

~~The table below sets forth the financial covenants in effect as of September 30, 2017.~~

Four Quarters Ended Four Quarters Ended
Financial Covenants September 30, 2017 EBITDA Reconciliation September 30, 2017
Interest coverage ratio (not less than) ¹
5.00x Operating income $ 941.0
Actual interest coverage ratio 18.05x Add:
Leverage ratio (not greater than) ¹
3.50x Depreciation and amortization 253.6
Actual leverage ratio 1.76x
EBITDA ¹
$ 1,194.6


1	The interest coverage ratio is defined as EBITDA, as defined in the Credit Agreement, to net interest expense for the four quarters then ended. The leverage ratio is defined as debt as of the last day of such fiscal quarter to EBITDA for the four quarters then ended.

Commercial Paper

~~In June 2017, the~~The Company ~~established a commercial paper program under which the Company was~~is authorized to issue unsecured commercial paper up to a maximum aggregate amount outstanding at any time of ~~$1,000.0. On October 25, 2017, the Company increased the maximum aggregate amount outstanding at any time under our commercial paper program to~~ $1,500.0. Borrowings under the program are supported by the Credit Agreement described above. Proceeds of the commercial paper ~~will be~~are used for working capital and general corporate purposes, including the repayment of maturing indebtedness ~~as described above,~~ and other short-term liquidity needs. The maturities of the commercial paper vary but may not exceed 397 days from the date of issue. As of September 30, 2017, the Company had outstanding commercial paper of $359.3 classified as short-term borrowings on our Consolidated Balance Sheet. The average amount outstanding under the program duringDuring the third quarter of ~~2017~~2023, there was ~~$488.2, with a weighted-average interest rate~~no commercial paper activity, and as of ~~1.4%~~September 30, 2023, there was no commercial paper outstanding.

Table of Contents

Management’s Discussion and ~~a weighted-average maturity~~Analysis of ~~fourteen days. See Note~~ 14 ~~to the unaudited Consolidated~~ Financial ~~Statements included~~Condition and Results of Operations - (continued)

(Amounts in ~~this Quarterly Report on Form 10-Q for further information.~~Millions, Except Per Share Amounts)

(Unaudited)

Cash Pooling

We aggregate our domestic cash position on a daily basis. Outside the United States, we use cash pooling arrangements with banks to help manage our liquidity requirements. In these pooling arrangements, several IPG agencies agree with a single bank that the cash balances of any of the agencies with the bank will be subject to a full right of set-off against amounts ~~that~~ other agencies owe the bank, and the bank provides for overdrafts as long as the net balance for all ~~the~~ agencies does not exceed an agreed-upon level. Typically, each agency pays interest on outstanding overdrafts and receives interest on cash balances. Our unaudited Consolidated Balance Sheets reflect cash, net of bank overdrafts, under all of our pooling arrangements, and as of September 30, ~~2017,~~2023, the amount netted was ~~$1,567.0.~~

~~Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)~~

~~(Amounts in Millions, Except Per Share Amounts)~~

~~(Unaudited)~~

$2,684.4.

DEBT CREDIT RATINGS

Our debt credit ratings as of October ~~16, 2017~~ 18, 2023, are listed below.

Moody’s Investors Service

S&P Global Ratings

Fitch Ratings

Short-term rating

P-2

A-2

Long-term rating

Baa2

BBB

~~BBB~~BBB+

Outlook

Stable

~~Positive~~Stable

We are rated investment-grade by Moody's Investors Service, S&P Global Ratings and Fitch Ratings. On June 8, 2017, we received from the credit rating agencies the short-term credit ratings, described above, with respect to our commercial paper. The most recent update to our long-term credit ratings occurred in April 2017 when S&P Global Ratings upgraded our rating from BBB- to BBB with a Stable outlook. A credit rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time by the assigning credit rating agency. The rating of each credit rating agency should be evaluated independently of any other rating. Credit ratings could have an impact on liquidity, either adverse or favorable, because, among other things, they could affect funding costs in ~~or the ability to access,~~ the capital markets or otherwise. For example, our Credit Agreement fees and borrowing rates are based on a ~~long-term~~ credit ratings ~~grid.~~grid, and our access to the commercial paper market is contingent on our maintenance of sufficient short-term debt ratings.

CRITICAL ACCOUNTING ESTIMATES

Our significant accounting policies are described in Note 1 to the Consolidated Financial Statements for the year ended December 31, ~~2016~~,2022, included in our ~~2016~~2022 Annual ~~Report on Form 10-K.~~Report. As summarized in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, in our 2022 Annual Report, we believe that certain of these policies are critical because they are important to the presentation of our financial condition and results of operations, and they require management’s most difficult, subjective or complex judgments, often as a result of the need to estimate the effect of matters that are inherently uncertain. These critical estimates relate to revenue recognition, income taxes, goodwill and other intangible assets, and pension and postretirement benefits. We base our estimates on historical experience and various other factors that we believe to be relevant under the circumstances. Estimation methodologies are applied consistently from year to year, and there have been no significant changes in the application of critical accounting estimates since December 31, ~~2016~~.2022. Actual results may differ from these estimates under different assumptions or ~~conditions.~~conditions and further decline in macroeconomic conditions or increasing interest rates could have a negative impact on these estimates, including the fair value of certain assets.

RECENT ACCOUNTING STANDARDS

See Note 13 to the unaudited Consolidated Financial Statements for further information on certain accounting standards that have been recently adopted or that have not yet been required to be implemented and may be applicable to our future operations.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

NON-GAAP FINANCIAL MEASURE

This MD&A includes both financial measures in accordance with U.S. GAAP, as well as a non-GAAP financial measure. The non-GAAP financial measure represents Net Income Available to IPG Common Stockholders before Provision for Income Taxes, Total (Expenses) and Other Income, Equity in Net (Loss) Income of Unconsolidated Affiliates, Net Income Attributable to Non-controlling Interests and Amortization of Acquired Intangibles, which we refer to as “Adjusted EBITA”.

Adjusted EBITA should be viewed as supplemental to, and not as an alternative for, Net Income Available to IPG Common Stockholders calculated in accordance with U.S. GAAP (“net income”) or operating income calculated in accordance with U.S. GAAP (“operating income”). This section also includes reconciliation of this non-GAAP financial measure to the most directly comparable U.S. GAAP financial measures, as presented below.

Adjusted EBITA is used by our management as an additional measure of our Company’s performance for purposes of business decision-making, including developing budgets, managing expenditures and evaluating potential acquisitions or divestitures. Period-to-period comparisons of Adjusted EBITA help our management identify additional trends in our Company’s financial results that may not be shown solely by period-to-period comparisons of net income or operating income. In addition, we use Adjusted EBITA in the incentive compensation programs applicable to some of our employees in order to evaluate our Company’s performance. Our management recognizes that Adjusted EBITA has inherent limitations because of the excluded items, particularly those items that are recurring in nature. Management also reviews operating income and net income as well as the specific items that are excluded from Adjusted EBITA, but included in net income or operating income, as well as trends in those items. The amounts of those items are set forth, for the applicable periods, in the reconciliation of Adjusted EBITA to net income that accompany our disclosure documents containing non-GAAP financial measures, including the reconciliations contained in this MD&A.

We believe that the presentation of Adjusted EBITA is useful to investors in their analysis of our results for reasons similar to the reasons why our management finds it useful and because it helps facilitate investor understanding of decisions made by management in light of the performance metrics used in making those decisions. In addition, as more fully described below, we believe that providing Adjusted EBITA, together with a reconciliation of this non-GAAP financial measure to net income, helps investors make comparisons between our Company and other companies that may have different capital structures, different effective income tax rates and tax attributes, different capitalized asset values and/or different forms of employee compensation. However, Adjusted EBITA is intended to provide a supplemental way of comparing our Company with other public companies and is not intended as a substitute for comparisons based on net income or operating income. In making any comparisons to other companies, investors need to be aware that companies may use different non-GAAP measures to evaluate their financial performance. Investors should pay close attention to the specific definition being used and to the reconciliation between such measures and the corresponding U.S. GAAP measures provided by each company under the applicable rules of the SEC.

The following is an explanation of the items excluded by us from Adjusted EBITA but included in net income:

•Total (Expenses) and Other Income, Provision for Income Taxes, Equity in Net (Loss) Income of Unconsolidated Affiliates and Net Income Attributable to Non-controlling Interests. We exclude these items (i) because these items are not directly attributable to the performance of our business operations and, accordingly, their exclusion assists management and investors in making period-to-period comparisons of operating performance and (ii) to assist management and investors in making comparisons to companies with different capital structures. Investors should note that these items will recur in future periods.

•Amortization of Acquired Intangibles. Amortization of acquired intangibles is a non-cash expense relating to intangible assets arising from acquisitions that are expensed on a straight-line basis over the estimated useful life of the related assets. We exclude amortization of acquired intangibles because we believe that (i) the amount of such expenses in any specific period may not directly correlate to the underlying performance of our business operations and (ii) such expenses can vary significantly between periods as a result of new acquisitions and full amortization of previously acquired intangible assets. Accordingly, we believe that this exclusion assists management and investors in making period-to-period comparisons of operating performance. Investors should note that the use of intangible assets contributed to revenue in the periods presented and will contribute to future revenue generation and should also note that such expense may recur in future periods.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)

(Amounts in Millions, Except Per Share Amounts)

(Unaudited)

The following table presents the reconciliation of Net Income Available to IPG Common Stockholders to Adjusted EBITA for the three and nine months ended September 30, 2023 and 2022.



	Three months ended September 30,						Nine months ended September 30,
	2023			2022			2023			2022
Revenue before billable expenses	$	2,309.0		$	2,296.2		$	6,814.4		$	6,898.9

Adjusted EBITA Reconciliation:
Net Income Available to IPG Common Stockholders 1	$	243.7		$	251.8		$	635.2		$	640.8

Add Back:
Provision for income taxes	91.5			76.4			135.9			209.2
Subtract:
Total (expenses) and other income	(37.3)			(10.4)			(91.7)			(80.5)
Equity in net (loss) income of unconsolidated affiliates	(2.3)			2.5			(1.7)			3.3
Net income attributable to non-controlling interests	(2.0)			(5.7)			(11.3)			(9.4)
Operating Income 1	376.8			341.8			875.8			936.6
Add Back:
Amortization of acquired intangibles	21.0			20.2			63.1			62.6
Adjusted EBITA 1	$	397.8		$	362.0		$	938.9		$	999.2
Adjusted EBITA Margin on Revenue before billable expenses	17.2		%	15.8		%	13.8		%	14.5		%

1 Calculations include restructuring charges of $(0.6) and $(0.7) for the three and nine months ended September 30, 2023 and $(5.8) and $0.7 for the three and nine months ended September 30, 2022, respectively. See Note 5 in Item 1, Financial Statements, for further information.

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Item 3.			Quantitative and Qualitative Disclosures about Market Risk

In the normal course of business, we are exposed to market risks related to interest rates, foreign currency rates and certain balance sheet items. From time to time, we use derivative instruments, pursuant to established guidelines and policies, to manage some portion of these risks. Derivative instruments utilized in our hedging activities are viewed as risk management tools and are not used for trading or speculative purposes. There has been no significant change in our exposure to market risk during the third quarter of ~~2017.~~2023. Our exposure to market risk for changes in interest rates primarily relates to the fair market value and cash flows of our debt obligations. As of September 30, ~~2017,~~2023 and December 31, ~~2016,~~2022, approximately ~~77%~~99% and ~~93%~~98%, respectively, of our debt obligations bore fixed interest rates. ~~We have, from time to time, used interest rate swaps for risk management purposes to manage our exposure to changes in interest rates. We do not have any interest rate swaps outstanding as of~~ ~~September 30, 2017~~. For further discussion of our exposure to market risk, refer to Item 7A, Quantitative and Qualitative Disclosures About Market Risk, in our ~~2016~~2022 Annual ~~Report on Form 10-K.~~Report.



Item 4.			Controls and Procedures

Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of September 30, ~~2017~~,2023, the Company’s disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosures.

There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives.

Changes in Internal Control Over Financial Reporting

There has been no change in internal control over financial reporting in the quarter ended September 30, ~~2017,~~2023, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II – OTHER INFORMATION



Item 1.			Legal Proceedings

Information about our legal proceedings is set forth in Note 12 to the unaudited Consolidated Financial Statements included in this Quarterly Report on Form 10-Q.



Item 1A.			Risk Factors

In addition to the other information set forth in this report, you should carefully consider the factors discussed in Item 1A, Risk Factors, in our 2022 Annual Report on Form 10-K (the “2022 Annual Report”), which could materially affect our business, financial condition or future results. In the third quarter of ~~2017,~~ 2023, there have been no material changes in the risk factors we have previously disclosed in Item 1A, Risk ~~Factors~~,Factors, in our ~~2016~~2022 Annual Report. The risks described in our 2022 Annual Report ~~on Form 10-K.~~are not the only risks we face, and additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect the Company’s business, financial condition or operating results.



Item 2.			Unregistered Sales of Equity Securities and Use of Proceeds

(c)The following table provides information regarding our purchases of our equity securities during the period from July 1, 2023 to September 30, 2023:


	Total Number of Shares (or Units) Purchased 1	Average Price Paid per Share (or Unit) 2		Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs 3	Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs 3
July 1 - 31	652,824	$	38.41	650,540	$	277,151,594
August 1 - 31	1,815,899	$	33.58	1,815,899	$	216,173,502
September 1 - 30	161,701	$	31.59	157,503	$	211,185,785
Total	2,630,424	$	34.66	2,623,942

1The total number of shares of our common stock purchased includes shares withheld under the terms of grants under employee stock-based compensation plans to offset tax withholding obligations that arose upon vesting and release of restricted shares (the “Withheld Shares”). We repurchased 2,284 Withheld Shares in July 2023; no Withheld Shares in August 2023; and 4,198 Withheld Shares in September 2023, for a total of 6,482 Withheld Shares during the three-month period.

2The average price per share for each of the months in the fiscal quarter and for the three-month period was calculated by dividing (a) the sum for the applicable period of the aggregate value of the tax withholding obligations and the aggregate amount we paid for shares acquired under our share repurchase program, described in Note 5 to the unaudited Consolidated Financial Statements, by (b) the sum of the number of Withheld Shares and the number of shares acquired in our share repurchase program.

3On February 8, 2023, the Board authorized a share repurchase program to repurchase from time to time up to $350.0 million, excluding fees, of our common stock. There is no expiration date associated with this share repurchase program.


~~(c)~~Item 3.			~~The following table provides information regarding our purchases of our equity securities during the period from July 1, 2017 to September 30, 2017:~~Defaults Upon Senior Securities

Total Number of
Shares (or Units)
Purchased ¹

Average Price Paid
per Share (or Unit) ²

Total Number of Shares (or Units) Purchased as Part of
Publicly Announced
Plans or Programs ³

Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs ³
July 1 - 31 1,045,347
$ 24.76
1,033,613
$ 314,797,836
August 1 - 31 2,336,046
$ 20.98
2,334,077
$ 265,832,070
September 1 - 30 1,288,700
$ 20.42
1,288,700
$ 239,522,615
Total 4,670,093
$ 21.67
4,656,390

None.


1Item 4.			Included shares of our common stock, par value $0.10 per share, withheld under the terms of grants under employee stock-based compensation plans to offset tax withholding obligations that arose upon vesting and release of restricted shares (the “Withheld Shares”). We repurchased 11,734 Withheld Shares in July 2017, 1,969 Withheld Shares in August 2017 and no Withheld Shares in September 2017, for a total of 13,703 Withheld Shares during the three-month period.Mine Safety Disclosures

The average price per share for each of the months in the fiscal quarter and for the three month period was calculated by dividing (a) the sum for the applicable period of the aggregate value of the tax withholding obligations and the aggregate amount we paid for shares acquired under our share repurchase programs, described in Note 5 to the unaudited Consolidated Financial Statements, by (b) the sum of the number of Withheld Shares and the number of shares acquired in our share repurchase programs.


3	On February 10, 2017, we announced that our Board of Directors had approved a new share repurchase program to repurchase from time to time up to $300.0 million of our common stock, in addition to amounts available on existing authorizations. There is no expiration date associated with the share repurchase programs.

Not applicable.



Item 5.			Other Information

(a) On October 25, 2017, The Interpublic Group of Companies, Inc. (the “Company”) entered into an amendment and restatement (the “Amendment”) of the Company’s credit agreement originally dated as of July 18, 2008, as amended and restated as of April 23, 2010, as further amended and restated as of May 31, 2011, as further amended as of November 6, 2012, as further amended and restated as of December 12, 2013 and as further amended and restated as of October 20, 2015 (as further amended and restated pursuant to the Amendment, the “Credit Agreement”). Under the Amendment, among other things, the revolving commitments under the Credit Agreement have been increased from $1 billion to $1.5 billion, and the maturity date was extended to October 25, 2022. The Company continues to have the ability to increase the commitments under the Credit Agreement from time to time by an additional amount of up to $250 million, provided the Company receives commitments for such increases and satisfies certain other conditions.None.

The cost structure under the Amendment has not changed. Based on the Company’s current credit ratings, the applicable margin for Eurocurrency Rate borrowings (as defined in the Credit Agreement) is 1.100%, and the facility fee payable on a lender’s revolving commitment is 0.150%.

In addition to other usual and customary covenants, the Credit Agreement contains two financial covenants, both of which remain the same. Under the Credit Agreement, the Company is required to maintain, as of the end of each fiscal quarter: (i) an interest coverage ratio of not less than 5.00 to 1.00 for the period of four fiscal quarters then ended; and (ii) a leverage ratio of not more than 3.50 to 1.00 for the period of four fiscal quarters then ended. The leverage ratio may be changed to not more than 4.00

to 1, at the election of the Company, for four consecutive fiscal quarters, beginning with the fiscal quarter in which there is an occurrence of one or more acquisitions with an aggregate purchase price of at least $200,000,000.

From time to time, one or more of the lenders under the Credit Agreement and certain of their respective affiliates have provided, and may in the future provide, investment banking and other financial advisory services to the Company and its affiliates, for which such lender or its affiliate has received or will receive payment of customary fees and expenses.

~~The foregoing description is qualified in its entirety by reference to the Credit Agreement, attached hereto as Exhibit 10(i)(1), which is incorporated herein by reference.~~

(b) As previously disclosed in a Current Report on Form 8-K filed on June 8, 2017, the Company established a commercial paper program (the “Program”), under which the Company may issue unsecured commercial paper notes (the “Notes”) on a private placement basis. On October 25, 2017, the Company increased the amount of Notes that it may issue from time to time under the Program to an aggregate amount not to exceed $1.5 billion outstanding at any time. Under the Program, the Company may issue Notes from time to time, and proceeds of the Notes will be used for working capital and general corporate purposes, including the repayment of maturing indebtedness and other short-term liquidity needs. Citibank, N.A. is acting issuing and paying agent under the Program. Each of the commercial paper dealers will act as a dealer under the Program (each a “Dealer” and, collectively, the “Dealers”) pursuant to the terms and conditions of a commercial paper dealer agreement entered into between the Company and each Dealer (the “Dealer Agreements”). Each Dealer Agreement contains customary representations, warranties, covenants and indemnification provisions. From time to time, one or more of the Dealers and certain of their respective affiliates have provided, and may in the future provide, commercial banking, investment banking and other financial advisory services to the Company and its affiliates for which such Dealer has received or will receive customary fees and expenses. The Notes have not been and will not be registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state securities laws, and may not be offered and sold except in compliance with an applicable exemption from the registration requirements of the Securities Act and any applicable state securities laws.

The information contained in this Report on Form 10-Q shall not constitute an offer to sell or the solicitation of an offer to purchase any Notes, nor shall there be any sale of the Notes in any jurisdiction in which such offer, solicitation or sale would be unlawful.

The maturities of the Notes will vary but may not exceed 397 days from the date of issue. The Notes will be sold under customary terms in the commercial paper market and will be issued at a discount from par, or, alternatively, will be issued at par and bear varying interest rates on a fixed or floating basis.



Item 6.			Exhibits

All exhibits required pursuant to Item 601 of Regulation S-K to be filed as part of this report or incorporated herein by reference to other documents are listed in the Index to Exhibits below.

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INDEX TO EXHIBITS


Exhibit No.			Description

~~Exhibit No.~~		~~Description~~

~~10(i)(1)~~31.1			Credit Agreement, dated as of July 18, 2008, as amended and restated as of April 23, 2010, as further amended and restated as of May 31, 2011, as further amended as of November 6, 2012, as further amended and restated as of December 12, 2013, as further amended and restated as of October 20, 2015 and as further amended and restated as of October 25, 2017 among The Interpublic Group of Companies, Inc., the lenders named therein and Citibank, as administrative agent.

~~10(iii)(A)(1)~~	~~The Interpublic Executive Severance Plan, amended and restated, effective August 16, 2017.~~

~~12.1~~	~~Computation of Ratios of Earnings to Fixed Charges.~~

~~31.1~~	Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.

31.2			Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.

32			Certification of the Chief Executive Officer and the Chief Financial Officer furnished pursuant to 18 U.S.C. Section 1350 and Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended.

101			Interactive Data File for the period ended September 30, ~~2017.~~2023. The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document.

104			Cover Page Interactive Data File. The cover page XBRL tags are embedded within the inline XBRL document and are included in Exhibit 101.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.




THE INTERPUBLIC GROUP OF COMPANIES, INC.

	By	/s/ ~~Michael I. Roth~~Philippe Krakowsky
		~~Michael I. Roth~~Philippe Krakowsky ~~Chairman and~~ Chief Executive Officer

~~Date:~~Date: October ~~26, 2017~~25, 2023





By	/s/ Christopher F. Carroll
		Christopher F. Carroll Senior Vice President, Controller and Chief Accounting Officer (Principal Accounting Officer)

Date: October ~~26, 2017~~

25, 2023



	Foreign Currency Translation Adjustments			Available-for-Sale Securities			Derivative Instruments			Defined Benefit Pension and Other Postretirement Plans			Total
Balance as of December 31, 2016	$	(716.7	)	$	0.6		$	(8.4	)	$	(238.0	)	$	(962.5	)
Other comprehensive income before reclassifications	113.4			0.0			0.0			6.3			119.7
Amount reclassified from accumulated other comprehensive loss, net of tax	1.8			(0.6		)	1.0			7.9			10.1
Balance as of September 30, 2017	$	(601.5	)	$	0.0		$	(7.4	)	$	(223.8	)	$	(832.7	)



	September 30, 2017												Balance Sheet Classification
	Level 1			Level 2			Level 3			Total			Balance Sheet Classification
Assets
Cash equivalents	$	153.2		$	0.0		$	0.0		$	153.2		Cash and cash equivalents
Short-term marketable securities	0.1			0.0			0.0			0.1			Other current assets
Long-term investments	0.4			0.0			0.0			0.4			Other non-current assets
Total	$	153.7		$	0.0		$	0.0		$	153.7

As a percentage of total assets	1.3		%	0.0		%	0.0		%	1.3		%

Liabilities
Contingent acquisition obligations¹	$	0.0		$	0.0		$	164.2		$	164.2

	December 31, 2016												Balance Sheet Classification
	Level 1			Level 2			Level 3			Total			Balance Sheet Classification
Assets
Cash equivalents	$	440.8		$	0.0		$	0.0		$	440.8		Cash and cash equivalents
Short-term marketable securities	3.0			0.0			0.0			3.0			Other current assets
Long-term investments	0.4			0.0			0.0			0.4			Other non-current assets
Total	$	444.2		$	0.0		$	0.0		$	444.2

As a percentage of total assets	3.6		%	0.0		%	0.0		%	3.6		%

Liabilities
Contingent acquisition obligations ¹	$	0.0		$	0.0		$	205.4		$	205.4



	Three months ended September 30, 2017				Nine months ended September 30, 2017
% Increase/(Decrease)	Total		Organic		Total		Organic
Revenue	(1.0	)%	0.5	%	(0.7	)%	1.1	%
Salaries and related expenses	0.0	%	1.3	%	0.4	%	2.4	%
Office and general expenses	(6.2	)%	(3.3	)%	(4.0	)%	(1.3	)%



			Components of Change											Change
	Three months ended September 30, 2016		Foreign Currency			Net Acquisitions/ (Divestitures)			Organic			Three months ended September 30, 2017		Organic		Total
Consolidated	$	1,922.2	$	7.7		$	(37.2	)	$	9.9		$	1,902.6	0.5	%	(1.0	)%
Domestic	1,165.9		0.0			(25.0		)	15.1			1,156.0		1.3	%	(0.8	)%
International	756.3		7.7			(12.2		)	(5.2		)	746.6		(0.7	)%	(1.3	)%
United Kingdom	174.0		(4.3		)	1.4			5.3			176.4		3.0	%	1.4	%
Continental Europe	147.6		6.4			(4.0		)	0.6			150.6		0.4	%	2.0	%
Asia Pacific	217.9		0.8			(0.2		)	(4.6		)	213.9		(2.1	)%	(1.8	)%
Latin America	103.6		2.4			(10.4		)	(10.3		)	85.3		(9.9	)%	(17.7	)%
Other	113.2		2.4			1.0			3.8			120.4		3.4	%	6.4	%



			Components of Change											Change
	Nine months ended September 30, 2016		Foreign Currency			Net Acquisitions/ (Divestitures)			Organic			Nine months ended September 30, 2017		Organic		Total
Consolidated	$	5,582.1	$	(30.7	)	$	(73.8	)	$	63.8		$	5,541.4	1.1	%	(0.7	)%
Domestic	3,426.2		0.0			(52.5		)	54.6			3,428.3		1.6	%	0.1	%
International	2,155.9		(30.7		)	(21.3		)	9.2			2,113.1		0.4	%	(2.0	)%
United Kingdom	495.3		(44.5		)	12.5			8.5			471.8		1.7	%	(4.7	)%
Continental Europe	468.1		(3.9		)	(13.3		)	6.1			457.0		1.3	%	(2.4	)%
Asia Pacific	617.7		(0.7		)	2.4			(12.0		)	607.4		(1.9	)%	(1.7	)%
Latin America	255.7		14.3			(24.6		)	(7.9		)	237.5		(3.1	)%	(7.1	)%
Other	319.1		4.1			1.7			14.5			339.4		4.5	%	6.4	%



Balance Sheet Data	September 30, 2017		December 31, 2016		September 30, 2016
Cash, cash equivalents and marketable securities	$	705.0	$	1,100.6	$	894.6

Short-term borrowings	$	511.8	$	85.7	$	107.8
Current portion of long-term debt	301.9		323.9		24.5
Long-term debt	1,285.0		1,280.7		1,583.3
Total debt	$	2,098.7	$	1,690.3	$	1,715.6



	Four Quarters Ended		Four Quarters Ended
Financial Covenants	September 30, 2017	EBITDA Reconciliation	September 30, 2017
Interest coverage ratio (not less than) ¹	5.00x	Operating income	$	941.0
Actual interest coverage ratio	18.05x	Add:
Leverage ratio (not greater than) ¹	3.50x	Depreciation and amortization	253.6
Actual leverage ratio	1.76x	EBITDA ¹	$	1,194.6



	Total Number of Shares (or Units) Purchased ¹	Average Price Paid per Share (or Unit) ²		Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs ³	Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs ³
July 1 - 31	1,045,347	$	24.76	1,033,613	$	314,797,836
August 1 - 31	2,336,046	$	20.98	2,334,077	$	265,832,070
September 1 - 30	1,288,700	$	20.42	1,288,700	$	239,522,615
Total	4,670,093	$	21.67	4,656,390

Weighted-average
grant-date fair value
(per award)

Stock-settled awards

Performance-based awards

Total stock-based compensation awards