Sapient Reports Q3 Income Drop, Slower Revenue Growth

Days after confirming that it has struck a deal to be acquired by Publicis Groupe, Sapient reported that its third-quarter net income was down more than 8% to $22.3 million, while revenue was up 8% to $350.7 million.

Third-quarter revenue growth was significantly less than the growth achieved earlier in the year. First-quarter revenues were up 17% and second-quarter growth was 15%.

For the first nine months, revenues are up 13% to $1.05 billion, and net income is up 7.8% to $59.2 billion.

The company, which owns digital agency SapientNitro, did not disclose organic growth figures and did not hold a conference call with analysts to provide commentary on the quarter as it usually does, and where the normally talkative Sapient CEO Alan Herrick would likely have provided an explanation for the company’s Q3 income drop and decelerating revenue growth.

The company cited the pending acquisition as the reason for not holding the call.

Earlier in the week when the companies disclosed the proposed $3.7 billion acquisition, Publicis Groupe indicated that Sapient would be rebranded Publicis.Sapient, with Herrick at the helm, leading the holding company’s digital transition efforts and with other key digital agencies, such as Razorfish Group and DigitasLBi reporting into Publicis.Sapient.

Digital -- which now accounts for about 41% of Publicis Groupe’s revenues -- will account for 50% of its top line as a result of the Sapient acquisition, the company said.

1 comment about "Sapient Reports Q3 Income Drop, Slower Revenue Growth".
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  1. Henry Blaufox from Dragon360, November 8, 2014 at 8:19 a.m.

    It would be interesting to know how each of the here major business units - government services, global markets, and Nitro - fared. The first two are the systems development and consulting groups that bring different capabilities to Publicis, but seem like outsiders and could be hard to blend into the operations. Any business decline there, however temporary and cyclical, could add to the strain.

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