WPP warns of ad spend cutbacks by US tech giants
Revenue grew by 4.9% to £2.8 billion at ad behemoth WPP, but it warned some major US tech firms had cut back on ad spend.
While it won contracts with firms such as Ford, Suzuki and Swissport, WPP also noted “lower spend from some technology clients” hit its revenue in the US.
UK revenue grew by 7.4%, thanks to consumer goods firms spending more.
The group has also upped its focus on AI, which it used to create personalised ads in India.
“Our focus on AI over the last five years is paying off, with many examples of our work with clients, using the main AI platforms, in-market today,” CEO Mark Read, pictured, said.
“We remain on track to deliver our full year guidance, thanks to the competitiveness of our offer and our role as a modern, trusted partner to clients in a world further disrupted by technology.”
Third Bridge analyst Sandeep Sharma warned cost increases could hit the firm hard because of its “bloated” structure.
“WPP’s bloated management structure and lack of centralisation have inflated the cost base, which should further impact.”
The firm continues to expect £180 million in restructuring costs for the year.
WPP shares are down 2.7% to 931.2p today.