Mumbai: Advertising giant WPP has reported a 7.8% decline in revenue for the first half of the fiscal year, in line with its July trading update, as the company continues to grapple with weaker client spending and a softer new business environment.
For the six-month period ended June 30, WPP posted total revenues of £6.663 billion, down from the prior year, while revenue less pass-through costs stood at £5.026 billion, marking a 4.3% decline on a like-for-like (LFL) basis. The group’s Q2 revenue less pass-through costs came in at £2.544 billion, down 12.6% on a reported basis and 5.8% LFL.
Operating profit margins also came under pressure. The reported margin for H1 was 3.3%, with the headline operating profit margin at 8.2%, reflecting a 2.9 percentage point decline LFL.
WPP reaffirmed its full-year guidance, forecasting LFL revenue less pass-through costs to decline between 3% and 5%, with headline operating profit margin expected to be down 50 to 175 basis points, excluding foreign exchange impacts.
Commenting on the performance, outgoing CEO Mark Read acknowledged the headwinds the company faced. “It has been a challenging first half given pressures on client spending and a slower new business environment,” he said.
Despite the tough climate, Read highlighted progress in the company’s transformation strategy. “We have made significant progress on the repositioning of WPP Media, simplifying its organisational model to increase effectiveness and reduce costs,” he noted. He also pointed to strategic investments, including the acquisition of data collaboration platform InfoSum and the launch of Open Intelligence, as key steps to bolster WPP’s data and technology capabilities.
The board has declared an interim dividend of 7.5p, ahead of a broader strategic review and capital allocation policy set to be led by incoming CEO Cindy Rose, who takes over from Read on September 1.
Looking ahead, WPP emphasized a focus on sustainable growth, financial flexibility, and shareholder returns. “WPP is a company with enormous strengths in creativity and media, technology and AI, talented people, deep client relationships and unmatched global reach,” said Read. “Thanks to our investment in AI, we can look to the future with confidence.”
Mark Read concludes his seven-year tenure as CEO amid a period of ongoing transformation and heightened focus on innovation, handing the reins to Rose as the company navigates a rapidly evolving advertising landscape.
