Declines in NA and China Flatten WPP Revenue

WPP has reported third quarter revenue less pass-through costs of $2.837bn, down 0.6% on a like-for-like basis and 5.0% on a reported basis. Declines in North America and China offset growth in the UK, Western Continental Europe and the firm's 'Rest of World' region.

The marcoms giant said it had made two recent significant moves to 'strengthen its competitive offer, simplify its business and benefit from scaled technology platforms' - the integration of three historic agencies into VML, billed as 'the world's largest creative agency'; and the further integration of GroupM with common products, a single technology platform, and the streamlining of operations and back-office functions supporting client-facing agencies. It expects these to drive stronger revenue growth and net annualised cost savings of 'at least £100m in FY25' with some benefit in 2024.

The group has revised its guidance to forecast annual LFL revenue growth of 0.5 - 1.0%: at the beginning of 2023 this was 3.0 - 5.0%. CEO Mark Read (pictured) says of the results, 'Our top-line performance in Q3 was below our expectations and continued to be impacted by the cautious spending trends we saw in Q2, particularly across technology clients with more impact from this felt in GroupM over the summer than the first half. We continue to win both creative and media assignments from leading global companies including significant wins in the third quarter with Estée Lauder (media), Hyatt (creative), Lenovo (creative), Nestlé (media) and Verizon (creative). Our net new business performance of $1.4bn in the quarter showed sequential improvement after a tougher first half'.

Web site: www.wpp.com/investors .