Havas Q3 net revenue rises 7.2 per cent as acquisitions boost growth

PARIS: Havas reported a 7.2 per cent year-on-year increase in net revenue to 703 million euros in the third quarter of 2026, supported by organic growth and acquisitions, as strong performance in North America helped offset weakness in parts of Asia Pacific, Africa and Latin America.

Revenue rose 6.3 per cent to 724 million euros during the quarter. Organic growth in net revenue stood at 2.4 per cent, compared with 3.8 per cent in the corresponding period last year. Acquisitions contributed 3.2 percentage points to growth, while foreign exchange movements added 1.6 percentage points.

The communications group said Media and Creative were the main contributors to its quarterly performance. Havas Health continued to face pressure from lower product launch activity in the US, after several drug candidates did not progress to launch following Phase III clinical trial outcomes.

“ Havas delivered a solid third quarter, achieving organic growth in net revenue of 2.4 per cent, in line with our full-year guidance,” said Havas chairman and CEO Yannick Bolloré.

He said the group’s client-centric model and ability to adapt to an uncertain macroeconomic and geopolitical environment supported its confidence in delivering sustainable, profitable growth. Havas is continuing to invest in its Converged.AI operating system, AI capabilities and talent, while integrating its expertise more closely across the group.

North America recorded organic growth of 7.5 per cent in the third quarter, driven by the Creative and Media divisions, which continued to benefit from client budget wins secured last year. Organic growth in the region reached 7.1 per cent for the first nine months of 2026.

Europe posted organic growth of 1.7 per cent during the quarter, supported by France, particularly its Media business, as well as Spain and Poland. Performance in the UK remained challenging. Havas said it implemented a new London Village organisational structure at the beginning of September. Europe’s organic growth for the first nine months stood at 1 per cent.

Asia Pacific and Africa recorded a 6.7 per cent decline in organic net revenue in the third quarter. The performance reflected continued weakness in China and the impact of geopolitical conflict in the Middle East. India continued to perform well, Havas said. The region’s organic growth was down 5.5 per cent for the first nine months, with approximately half the decline attributable to the Middle East and the remainder to China.

Latin America reported negative organic growth of 4.3 per cent in the quarter, primarily due to Mexico and Peru. Stronger performance in Brazil and Chile was insufficient to offset the declines. The region nevertheless maintained positive organic growth of 1 per cent for the first nine months of the year.

Havas continued its strategy of acquiring majority stakes in independent agencies to expand its capabilities and support growth. It completed eight acquisitions during the first nine months of 2026.

The latest addition was SportVibes, a Dutch sports marketing agency acquired in July. The deal strengthens Havas Play’s offering across the Benelux region and expands its sports marketing capabilities in Europe.

Other acquisitions contributing to the change in scope included Acento in Spain, Eyesight in France, Styleheads in Germany and Archrival in the US, alongside Gauly Advisors in Germany, Unnest in France and Bearded Kitten in the UK.

Havas said it typically targets eight to 10 acquisitions annually, with 11 completed in 2025. The deals generally add around 40 million to 50 million euros in annualised net revenue and are usually completed at profitability levels above the group average.

Havas retained its financial guidance for 2026, despite continued uncertainty around economic conditions and geopolitical developments.

The group expects organic growth in net revenue of between 2 per cent and 3 per cent for the full year, an adjusted earnings before interest and tax (EBIT) margin of 13.2 per cent to 13.5 per cent, and a dividend payout ratio of around 40 per cent.

It also reaffirmed its medium-term target for an adjusted EBIT margin of 14 per cent to 15 per cent by 2028, with the dividend payout ratio remaining at around 40 per cent.

Havas said it did not anticipate a significant change in market conditions during the fourth quarter, while noting that visibility remained limited. The group will continue to focus on its integrated operating model, client relationships and disciplined execution of its strategy.

The company said its direct exposure to the Middle East remained limited, with operations in Dubai, Oman, Saudi Arabia and Israel representing a weighted 1.6 per cent of group net revenue at the end of September. It said the ongoing conflict had no material impact on its financial statements, although regional activity remained under pressure.

Havas also continued its financial investment activity during the quarter. It bought around 5.3 million shares in Louis Hachette Group between July and September, while acquiring around 12 million Canal+ shares in early October. The company said these investments would not affect its strategy, financial guidance or acquisition policy.

The group bought back around 66,000 ordinary shares during the third quarter at an average price of 18.42 euros per share. Its share buyback programme was suspended following the launch of a liquidity programme on 1 October.

Founded in Paris in 1835, Havas operates in more than 100 countries and employs nearly 23,000 people. Its integrated model combines creativity, media, technology and production, supported by Converged.AI, its operating system designed to bring together data, technology and AI across the customer journey.