WPP shares slump after profit outlook slashed
By Frank Prenesti
Date: Thursday 10 Jul 2025
(Sharecast News) - Shares in WPP slumped on Wednesday after the advertising agency slashed annual profit forecasts as it failed to win new clients amid a weakening economic outlook and the growing threat from artificial intelligence.
The company said it expected full-year organic revenue less pass-through costs - a main measure of its performance - to fall by 3-5% with a decline in operating margin of 50 to 175 basis points. Second-quarter revenue fell more than expected as clients cut back on spending and job loss costs fed through.
Shares in the firm were down 13% in early London trade on the news.
Prior guidance was for flat to down 2%, with a flat headline operating profit margin. Advertising agencies face growing competition from AI, which allows companies to design their own marketing campaigns for a fraction of the cost.
"Since the start of the year, we have faced a challenging trading environment with macro pressures intensifying and lower net new business," said chief executive Mark Read, who is due to leave the firm at the end of the year.
"While we expected the second quarter to be similar to the first quarter, performance in June was worse than anticipated and we expect this pattern of trading in the first half to continue into the second half."
Reporting by Frank Prenesti for Sharecast.com
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