Omnicom Group Inc. stock research
FY2025 Q1
Omnicom Group (OMC) Gross Margin — Quarter Ended Mar 31, 2025
Revenue and gross profit both decreased compared to the prior quarter, while cost of revenue declined at a slower pace, resulting in a lower gross margin. Versus the same quarter one year earlier, revenue and gross profit were slightly higher, cost of revenue increased modestly, and gross margin was nearly stable.
Gross margin takeaway
Quarter ended Mar 31, 2025 · FY2025 Q1
Revenue and gross profit both decreased compared to the prior quarter, while cost of revenue declined at a slower pace, resulting in a lower gross margin. Versus the same quarter one year earlier, revenue and gross profit were slightly higher, cost of revenue increased modestly, and gross margin was nearly stable.
- The strongest observable margin driver is the relationship between revenue and cost of revenue; in the current quarter, the cost of revenue consumed a larger share of revenue than in the prior quarter, compressing gross margin.
- Compared to the immediately preceding quarter, gross margin weakened as revenue fell more sharply than cost of revenue. Relative to the same quarter one year earlier, gross margin was mixed, with revenue and gross profit slightly higher but cost of revenue also higher.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
17.1%
Gross profit
$629.5M
Revenue
$3.7B
Cost of revenue
$3.1B
Quarter-over-quarter change
-2.8 pts
Year-over-year change
-0.1 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Jun 30, 2024 | $3.9B | $681.7M | $3.2B | 17.7% |
| Sep 30, 2024 | $3.9B | $761.0M | $3.1B | 19.6% |
| Dec 31, 2024 | $4.3B | $857.9M | $3.5B | 19.8% |
| Mar 31, 2025 | $3.7B | $629.5M | $3.1B | 17.1% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Dec 31, 2024
-2.8 pts
Year-over-year change
Mar 31, 2024
-0.1 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable margin driver is the relationship between revenue and cost of revenue; in the current quarter, the cost of revenue consumed a larger share of revenue than in the prior quarter, compressing gross margin.
Compared to the immediately preceding quarter, gross margin weakened as revenue fell more sharply than cost of revenue. Relative to the same quarter one year earlier, gross margin was mixed, with revenue and gross profit slightly higher but cost of revenue also higher.
Monitor the trajectory of cost of revenue relative to revenue in upcoming quarters to assess whether the margin compression observed from the prior quarter persists.