Bengaluru: Omnicom Group Inc, the largest US advertising company, reported better-than-expected quarterly revenue and profit as ad spending rose, particularly in the United States.

US ad spending has been gaining momentum as consumer goods companies try to encourage reluctant consumers, suffering from stagnant wages, to crack open their wallets.

The growing popularity of private label brands has also pushed national brand owners such as Kraft Foods Group Inc to increase marketing budgets.

Global ad spending rose nearly 6 per cent to $545.4 billion (Dh2 trillion) in 2014 and is expected to reach $662.7 billion by 2018, according to statistics website Statista.

There had been concerns that Omnicom’s second-quarter earnings would suffer because management was focused on completing a $35 billion merger with France’s Publicis Groupe SA . That deal fell apart in May.

The two advertising giants lost business worth more than $1.5 billion in April due to uncertainty over the deal, Pivotal Research analyst Brian Wieser has said.

Publicis warned earlier on Tuesday it would be “very difficult” to meet its annual organic sales growth target after a second-quarter slowdown caused in part by the failure of the planned merger.

Omnicom, however, reported a 6.4 per cent rise in revenue to $3.87 billion in the quarter ended June 30, topping the average analyst estimate of $3.8 billion.

The company, whose clients include McDonald’s Corp, Adidas AG and Apple Inc, said ad revenue increased 10.5 per cent in the quarter.

Revenue from the United States, which accounts two thirds of the total, rose 7.8 per cent, while international revenue increased 4.9 per cent.

Net income available for common shareholders rose to $318.9 million, or $1.23 per share, from $281.7 million, or $1.09 per share, a year earlier.

Excluding items, the company earned $1.20 per share, compared with the average analyst estimate of $1.17 per share, according to Thomson Reuters I/B/E/S.

Omnicom’s operating margin slipped to 14.2 per cent, from 14.4 per cent a year earlier. The deal with Publicis was expected to boost the company’s margins.

Smaller rival Interpublic Group of Cos Inc reported better-than-expected quarterly revenue last week, boosted by strong growth in the UK and higher ad spending in its core US market.

Omnicom shares, which were untraded premarket, closed at $71.33 on the New York Stock Exchange on Monday.

The stock has gained nearly more than 9 per cent since the deal with Publicis fell apart.